EUR/USD fractal outlook

[Paul Koszarny]

Robertfo,

I refer to CET.

[jpygbp]

Paul,

Are you profitable using fractals?

[Paul Koszarny]

Yes, I am.

[Paul Koszarny]

EUR/USD dipped as low as 1.0675. Here (in Warsaw) we were short at 1.0760 and closed at round figure 1.0700. Two long positions were opened. The first one at 1.0729 and double the amount at 1.0691. The plan is to close them at 1.0805. Though shorts from 1.0760 was yesterday's plan, I was particularly anxious about them for some reasons and that's why the first buy was opened before the previous position was closed. We also closed shorts on EUR/PLN and USD/PLN, went long on USD/PLN but this trade is already losing money and will probably evacuate tomorrow. Dow Jones, Nasdaq, S&P500, DAX do as Romans do after bifurcation. Those volume signals negative for the markets and the high correlation with the dollar made me very nervous while sitting on EUR/USD shorts.

[Paul Koszarny]

EUR/USD managed to climb near 1.0800 in the morning again in very overbought conditions. The nearest model hour is 14:00-15:00CET and until then we will probably not see any new opportunity to enter the market. DAX is close to suffocating investors in a very tight triangle bordered by 2700-2749 today who are not shure whether to waver from war elations to profit concerns or vice versa. Soon there should be a break out from the trap. Why did Wall Street turn its back on war news yesterday, media asked. Early warning had come from volume signals. The system was in turbulence on Monday, similar to the one experienced by pilots in the air. The market descends quite fast, yet it is still not far from Monday highs. We are entering an area of the most significant part of the week from the point of view of fractals. Normally I expect volatility to increase, a new local extreme to be posted and a sharp reversal afterwards. Some would say that volatility has already been above average for quite some time.

[jurgens]

Paul

Which technical indicators do you use with your Fractal analysis?

Thank you

[Paul Koszarny]

Bollinger bands, MAs (simple), stochastics slow (21,3,3).

[Paul Koszarny]

We have seen a sharp rejection on approach to the last Fibo retracement on today's model hour 14:00-15:00. Negative divergences on stochastics and RSI are visible on M60 charts. Therefore below 1.0805 selling pressure will mount. But I would be cautious here because the movement coincided with the announcement of US statistics and it's possible the market overreacted as usual. I moved stop higher to preserve some profit. DAX waiting for an action below resistance 2749. Warsaw futures -2.36% below local high following bifurcation from Monday.