Monday, 11 March 2013

Shocks & Surprises Weekly FX Observations

It was a relatively muted week in fx markets, with no new trends established, and no existing trends challenged.  Rather, the dollar simply took a breather.  Please check previous weeks' posts for the relevant caveat: remember, there are no consistently reliable ways to forecast short-term currency movements, and these observations have no pretensions they have solved that problem.


Strengthening Trends
US Dollar: The dollar was steady on the week, but the strengthening trend in place since early Jan is not under challenge. The currency remains at its strongest since July 2010.
Rmb: The very gentle strengthening trend established in early October 2012 remains in place and has not yet morphed into stability against the dollar. But it is moving that way.

Weakening Trends
Euro: The weakening trend established during the previous week was neither strengthened nor challenged by this week's stability. But the current ceiling of around 1.31 is unchanged on the week.
Sterling: The weakening trend is unrelenting, and was not relieved in any way during the week.  The ceiling has now come down to 1.58 to the dollar.
Yen: The weakening trend in place since mid-December stalled during the last week, but is not under threat. The current ceiling continues to come down, and now stands at 87.1
A$: The new weakening trend was established in early Feb, and is not under threat: the current ceiling is around 0.961.
Turkish Lira:  Weakening trend in place since late Feb is not challenged: the current ceiling remains unchanged on the week at 1.782.
Gold: A steady week for gold, but it does not imply a challenge to the weakening trend in place since the beginning of the year. The ceiling continues to drop quickly, and now stands at 1,671 an oz.
Commodities CRB Index:  The current weakening trend is now entering its fifth month, unchallenged. The ceiling of 296 is unchanged on the week.

3 comments:

  1. Let me explain the basic principle how most Forex systems work. They are tuned up to work in a specific market condition. They often make money in a trending market, but loose money in a choppy market. It is not a problem as long as the market is trending and the system is making more money than it loses. Such a system can be profitable for several months and you would be happy with it. BUT...

    PREPARE FOR THE WORST...

    Market change over time. A well designed system starts with trend analysis to stay away from potentially losing trades. There are two problems of how a Forex system recognizes the trend.

    PROBLEM: FALSE "STRONG TREND" INDICATION.

    The system responds only to immediate price action. An explosive price movement that is usually the result of news release is tempting people to jump in and make a profit. It looks like a "strong trend", but what usually happens next is a hard fall.

    To avoid falling into this trap, check for the SOLUTION to find a REAL trend:

    ==> http://www.forextrendy.com?vgcvasdiugf9g87346

    SECOND PROBLEM: TREND RELIABILITY

    Most systems use various indicators to determine the trend. Actually, there is nothing bad about using indicators. One Simply Moving Average can do the job. The problem comes with the question: "Is the market trending NOW?" Whether the market is trending or not trending is not like black and white. The correct question is: "How well the market is trending?"

    And here we have something called TREND RELIABILITY.

    Trends exist and they can be traded up and down for a profit. You have to focus only on the most reliable market trends. "Forex Trendy" is a software solution to find the BEST trending currency pairs, time frames and compute the trend reliability for each Forex chart:

    ==> http://www.forextrendy.com?vgcvasdiugf9g87346

    ReplyDelete
  2. "Which Forex pair and time frame is best to trade" is the frequently asked question and I want do give you the DEFINITE ANSWER.

    Are you expecting that I am going to say something like EUR/USD on 5-minute time frame or GBP/USD on daily...? No, it is not so simple, but SIMPLE ENOUGH we can figure it out!

    The "PROBLEM" is that markets change over time. If GBP/USD was a well trending currency pair a few years ago, today it is another one.

    I actually want to let you know about a SPECIAL TOOL that I use to find the BEST TRENDING PAIRS among all the Forex pairs.

    ==> http://www.forextrendy.com?hfsdtb63546

    The software scans 34 Forex pairs on all time frames from minute to monthly. This way you pick the best trending pair and time frame at the current time.

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    ReplyDelete
  3. Let me explain the basic principle how most Forex systems work. They are tuned up

    to work in a specific market condition. They often make money in a trending

    market, but loose money in a choppy market. It is not a problem as long as the

    market is trending and the system is making more money than it loses. Such a

    system can be profitable for several months and you would be happy with it.

    BUT...
    PREPARE FOR THE WORST...
    Market change over time. A well designed system starts with trend analysis to

    stay away from potentially losing trades. There are two problems of how a Forex

    system recognizes the trend.
    PROBLEM: FALSE "STRONG TREND" INDICATION.
    The system responds only to immediate price action. An explosive price movement

    that is usually the result of news release is tempting people to jump in and make

    a profit. It looks like a "strong trend", but what usually happens next is a hard

    fall.
    To avoid falling into this trap, check for the SOLUTION to find a REAL trend:
    ==> http://www.forextrendy.com?nsjjd92834
    SECOND PROBLEM: TREND RELIABILITY
    Most systems use various indicators to determine the trend. Actually, there is

    nothing bad about using indicators. One Simply Moving Average can do the job. The

    problem comes with the question: "Is the market trending NOW?" Whether the market

    is trending or not trending is not like black and white. The correct question is:

    "How well the market is trending?"
    And here we have something called TREND RELIABILITY.
    Trends exist and they can be traded up and down for a profit. You have to focus

    only on the most reliable market trends. "Forex Trendy" is a software solution to

    find the BEST trending currency pairs, time frames and compute the trend

    reliability for each Forex chart:
    ==> http://www.forextrendy.com?nsjjd92834

    ReplyDelete