Tag Archive for: AUDNZD
Factor Update – May 8, 2016
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Factor Update – April 24th
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Factor Update – April 3rd
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Factor Update, March 20, 2016
General Market Commentary
Not all market environments are equal. Similarly, the same market environment can treat different trading styles in very different ways – some favorably, others miserably. The current markets, in my opinion, are neutral/hostile to classical charting principles. Current markets are volatile; false and premature breakouts have increased in 2016 to date; and, there is a lack of substantial patterns under construction. I have experienced this type of trading environment before – many times. There are profits to be had in some markets, but there are also an oversupply of land mines. For me, this type of trading environment has not correlated well with a robust three-month forward ROR. Of course I will continue to take signals that are promising knowing that sooner or later markets favorable to classical charting will return. Warning: I generally ignore one-day price action, preferring area patterns. Yet, nearly every market discussed in this Update experienced a narrow real-range bar on Friday that occurred at or just below the close of Thursday’s wide range day. This development suggests the possibility of a shake out next week. According, I enter next week in a very defensive frame of mind.Market Review
Read MoreFactor Update, March 20, 2016
General Market Commentary
Not all market environments are equal. Similarly, the same market environment can treat different trading styles in very different ways – some favorably, others miserably. The current markets, in my opinion, are neutral/hostile to classical charting principles. Current markets are volatile; false and premature breakouts have increased in 2016 to date; and, there is a lack of substantial patterns under construction. I have experienced this type of trading environment before – many times. There are profits to be had in some markets, but there are also an oversupply of land mines. For me, this type of trading environment has not correlated well with a robust three-month forward ROR. Of course I will continue to take signals that are promising knowing that sooner or later markets favorable to classical charting will return. Warning: I generally ignore one-day price action, preferring area patterns. Yet, nearly every market discussed in this Update experienced a narrow real-range bar on Friday that occurred at or just below the close of Thursday’s wide range day. This development suggests the possibility of a shake out next week. According, I enter next week in a very defensive frame of mind.Market Review
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Factor Report – March 13th
Market Review
Factor Moves are currently ongoing in:- Gold
- Japanese Yen
- USD/NOK
- Copper
- AUD/NZD
Factor Moves in Progress
Copper (daily chart)
After falling from a high of 465 in Feb 2011, it appears that Copper bottomed at 193.55 on Jan 18. The advance on Mar 1 confirmed a H&S bottom. I have upped the initial price target to 231.90. An eventual test of the Oct 2015 high at 244 is likely. Factor is long one layer.
Read MoreFactor Report – March 13th
Market Review
Factor Moves are currently ongoing in:- Gold
- Japanese Yen
- USD/NOK
- Copper
- AUD/NZD
Factor Moves in Progress
Copper (daily chart)
After falling from a high of 465 in Feb 2011, it appears that Copper bottomed at 193.55 on Jan 18. The advance on Mar 1 confirmed a H&S bottom. I have upped the initial price target to 231.90. An eventual test of the Oct 2015 high at 244 is likely. Factor is long one layer.
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Japanese Yen is attempting to break out of a major H&S pattern.
A chart analysis of the forex markets
This post looks at the present forex markets through the lens of classical charting principles, as originally forumated in the early 1930s by Richard W. Schabacker, editor at the time of Fortune Magazine. Factor LLC is recognized as one of the world’s preeminent authorities on classical charting principles as applied to the futures and forex markets.
There are a number of forex crosses that indicate substantial trading opportunities for traders willing to hold positions for weeks or even months. Before examining the current forex markets, a basic understanding of classical charting principles is approriate.- Charts simply show where a market has been, what it is doing now, and what the path of least resistance might be. Classical charting is simply an attempt to define market behavior in geometric terms. The real edge provided by classical charting comes from the marriage of risk management with well-defined geometric patterns.
- There is no magic in price charting. Charts do NOT predict the future. Unlike some Elliott Wave adherents who attempt to label every zig and zag, I believe that the vast overwhelming majority of markets the vast overwhelming proportion of time cannot be understood through the lenses of classical chart principles (or any other method of technical analysis, including Elliott Wave Theory).
- Well-defined chart patterns naturally provide opposite possible outcomes. A rectangle can complete in either direction. A rising wedge can become a running wedge. A symmetrical triangle can fake a trader out in more ways than imaginable. A H&S pattern can become a H&S failure. And on and on it goes.
- Charts are subject to morphology. I do my best to always find a geometric explanation for price action. As a chart morphs it can be subject to different geometric construction. As a general rule, intraday charts morph more often than daily charts, daily charts morph more often than weekly charts. But, more often than not a market cannot be explained easily by geometry. It is then time to find another market. This is why I might be focused on Robusta Coffee one day and some foreign stock index another day. I want to focus on markets I can define geometrically.
- Reliable chart trading is cyclical. There are periods during the year (an average of two periods lasting two or so months each) when an unusual number of markets form well defined patterns AND the markets respond to those patterns in predictable fashion. Using language of farming, this is time to make hay. During the other periods we rely on aggressive risk management to limit our losses and keep out pile of chips somewhat intact.
- It is a thing of beauty when classical chart configurations work. It is a thing of frustration when they do not work. It is a thing of confusion when the majority of markets defy definition from a classical charting perspective.
A review of selective forex markets
Eurocurrency (EUR/USD) The long-term trend (as featured by the 45-year trendline) in EUR is under threat, as shown by the quarterly graph. The dominant chart construction is the 6-1/2 year descending triangle completed in Jan 2015. This pattern has a target of $.84. Such a decline would likely be accompanied by a massive change in the European Currency Mechanism (ERM).
Read MorePeter Brandt’s Charting Tool
Peter’s Crypto Coverage
