EURUSD - Buy

Follow up to an old analysis here.

Buy EURUSD, targeting 1.3526 and sell from 1.3526

NZDUSD - Down to 0.8373

Short to 8373 and go long from 835.. Continuation of the trade posted few weeks ago here.

AUDJPY - Sell

Sell AUDJPY, targeting 93.85, with stops at 95.85. RR isn't that great, but this should be smooth sailing. Look for longs from 93.85 targeting 96.875

EURCAD Renko Analysis - Long term short position

Pending Sell order at 1.448, targeting 1.1.373 with stops at 1.473.

Risk: 250 pips
Profits: 750 pips

Trade could possibly play out until end of the year

EURUSD - Potential Short Position

EURUSD, Renko charts show a possible downtrend in play, with the likelihood of a retracement, giving traders the chance to sell the rallies. There seems to be a good price level of 1.3526 and 1.3576 to short from, targeting 1.3376 with stops for both orders coming in at 1.3676.

The chart below shows the trade set up for EURUSD Renko charts.

EURUSD - Renko Charts Analysis, 25/07

The same chart when viewed with the regular candlesticks is shown below.

EURUSD - Daily Charts, Candlesticks

Notice how price is trading below the 200EMA. Stochastics are in oversold levels, pointing to a possible correction to the upside. The trend line has been broken and there was a clear re-test of the broken trend line as well, confirming the bias to the downside.

Importance of multiple confirmations with Renko

This is a great example I came across which shows the importance of using additional confirmations when trading with Renko. Because everything is not as it seems to be.

The chart below is that of EURGBP 10Pip fixed renko.

EURGBP - Renko Example

First, we see a double bottom formation that took quite a while to form, which gives it some weight. This DB's target was to 084741. But price ran up and reversed near 0.83941, which was just a few pips below 150% or half way of the trade.

Maybe an alarm bell should have rang when a lower high was made 0.83841. So perhaps profits could have been booked near the previous low of 0.83541.

Anyways, moving forward, after the failure we now see a broadening triangle pattern being formed. But how do we know its going to hold?

There have been multiple confirmation validating the move to the downside.

First comes the support turned resistance at 0.82841. It also marks the 50% level of the triangle. But that wouldn't have been a signal to short as price didn't break the main support at 0.81741.

Subsequently, another small reversal or lower high was made just below 0.82491 and finally the main support was broken.

Then, we got a confirmation with the support turning resistance at 0.81741. This would be where we would put a pending sell near the reversal low of 0.81441 with stops one or one and half brick above the level of 0.81741 targeting 150% and 200% of the move.

When another small reversal took place near 81241, a break of the reversal low would indicate to move stops to lock in profits as price nears the 150% level.

So what next?

We see a reversal taking place just 10 - 20 pips away from profit. Ideally, this is not a good price level to short from. But existing traders could now move their stops to a better level, maybe one and half bricks above 0.80641 and wait for the final target to be hit.

EURUSD Renko Analysis - Alternate View (Double Bottom Scenario)

Not much of time to publish charts, but from the previous post here, an alternative view would be that of a break of the second ascending triangle. If 1.3526 gives way, the next support comes in at 1.3376.

This sets the tone for a double bottom (if it holds) which gives further upside target to 1.44/1.45

For now, watching!!!

EURAUD: Moving targets to the H&S level at 1.458 if there is a bullish retracement to the downtrend after a tap of this level.

USDJPY Renko Head and Shoulders(ish....)

USDJPY - Head & Shoulders Forming

The left shoulder and head has been formed and price looks steady to form the right shoulder. Ideally a bullish brick at 103.050 will make is ideal to trade the following ways:

1. Short from 103.050, stops at 103.485 and targeting 100.005
2. Short from 101.745, stops at 103.050 and targeting 100.005

The risk/reward varies for both, but ideally, i'd start with a smaller position at the top and build into the trade accordingly.

Bear in mind that this trade set up is valid only when a bullish renko is printed closing at 103.050

AUDJPY Renko Analysis - Inverted H&S

AUDJPY - Head & Shoulders

The neckline comes in at 93.518 which could make it an ideal level to go long from. But the risk comes from the minor retracement of 2 bearish bricks. So an alternative trade would be to pending buy from 96.046 which makes it less attractive.

But if you compare the bricks (4 bricks from 96.406) to target of 98.574, the retracement should ideally stop at 93.518, which makes it 4 bricks down (3 down + 1 reversal).

All in all, this looks like a very neat trade set up.

EURUSD... ECB has to fight a bullish Euro

The EURUSD Renko chart here paints the picture. Lot of things on chart, so let me explain.

EURUSD - Bigger Picture

First there was an ascending triangle (marked in pink) which had a target to 1.3926 which was duly achieved.

Within the journey of this ascending triangle, there was a secondary ascending triangle formed (marked in Black) which targets 1.4176.

However, after hitting the first ascending triangle's target, price formed a small double top at 1.3926 giving a downside target to 1.3526. The neckline of this double top comes at 1.3726.

Possible Scenarios:

• With tomorrow's ECB, we could expect a straight drop to 1.3562
• A retracement to the neckline at 1.3726 is possible, but weak because 1.3651 or 1.3676 could come in as resistance (150% distance of first ascending triangle)
• If a bullish renko is formed at that level, then a short after a bearish renko being printed can see price travel down to the final target of 1.3526.

Once the base is formed at 1.3526, we could see a resurgent rally and validates the secondary ascending triangle (marked by the rising black trendline). But for a safe entry for this kind of set up, we will have to wait for a breakout above 1.3776.

Overall, the bigger target for EURUSD comes in at 1.4176 and within the larger scope of things, EURUSD is quite bullish.

Edit:

The risk to EURUSD is that if the Double top does reach the target, there isn't any considerable bias that support will be found with the only exception of a reversal taking place previously.

Therefore, long positions would be better off either to wait for a break of 1.3776 or wait for price to rally above 1.3726 in order to confirm the support level at 1.3526

CADJPY - Follow up to Long trade

This is a continuation of my previous post here.

After a few hiccups, price seems to be slowly treading along to the upside. The target is towards 95.536, which seems to be a very deep correction to the actual downtrend. Nothing much has changed to the analysis, I just added the Median Line to gain perspective.

CADJPY - Renko Chart, Long Position

An alternate view from ATR's Renko settings shows a double bottom that was just broken upwards, targeting 95.6.

Bullish CADJPY, Alternate View

CADJPY - Buying the ascending Triangle

I hope... and I hope this will be a quick trade. A nice ascending triangle was formed on CADJPY renko and the resistance was broken, tested and this pair looks ripe heading towards 95.536.

CADJPY - Renko, Ascending Triangle

USDCAD - The way I see it

USDCAD - Renko Chart Analysis

Combining Renko and Candlestick charts

Renko charts are great in terms of understanding what price is doing minus all the price spikes or wicks we get to see in Candlestick charts. However, a confluence between Renko and Candlestick charts can be a great way to gain confidence in a trade.

In this article, I present the USDJPY trade idea which combines renko and candlestick charting. Readers might know about a bearish call made on USDJPY here. Nothing has been changed on the analysis.

USDJPY - Renko Charts - Bearish Flag

To summarize:

• A major triangle was formed, which gives a target to the upside breakout at 106.864
• Price rallied 3/4ths only to reverse and start making lower highs (figuratively) and higher lows, indicating consolidation taking place
• During the process a bearish flag was formed, where the high of the flag managed to kiss 61.8% of the most recent leg to the downside.
• The bearish flag gives a target to 98.303
• I suspect a retracement to 38.2% at 102.657 before price drops lower.

Now switching to the candlestick charts and measuring the previous leg up with Fibs gives us the respective fib levels.

USDJPY - Candlestick Charts

• On the candlestick charts, we notice a triangle pattern set in place
• When measuring the previous leg up, we see a retracement to 50%
• We also notice what seems like a head and shoulders pattern being formed. If this holds, it gives us a downside target to 99.108

What to look for:

• Price shouldn't head to 102.657 and should reverse and move into the median line.
• In such an event, we can short USDJPY at 101.635 with stops at 102.657
• Trades could be moved to break even at 100.965 and book partial profits at 100.23 and 99.1 and finally 98.3 with stops moved to 100.23 to make the third trade risk free.

Trading made simple with Renko Charts (G-X Norway ETF Example)

Thought of making a post every now and then which shows how simple and stress free it is trading with Renko Charts.

Here's the G-X Norway ETF

Renko Charts - Price Action Case Study

I know in hindsight things look easy, but let's ignore the entire leg of the renko brings and focus on leg 1.

We see a strong trending market and then a series of down (red) reko bars. Plotting using the Fib tool, we get 14.25 as 38.2% retracement level. The first retracement fails to retrace to 38.2% and rallies, only to make a lower high, indicative of a losing momentum. This would have been the first signal. After a small pullback to the decline, we see a continued downtrend... and where does price retrace to?? Voila 38.2% of the leg 1 at 14.25.

Price then rallies until it makes a lower high. So we plot the next leg with Fib. The retracement here was quick and swift, with price reversing bang at 61.8% Fib, 15.26. Further confluence comes from the trendline holding.

Sure, between 14.25 and the drop to 15.26, it would have been just a 7% growth compared to the peak of 18%. However, with a bit of patience and objectivity, a trader could have purchased again at 15.26 thus increasing their equity even more.

Goes to show how simple it is to trade with Renko charts.

Interested to learn more about Renko? Click here.

EURNZD - Waiting for the retracement

Today's RBNZ Wheeler expressed concerns of the appreciating Kiwi Dollar. Against most of the pairs, the NZD has been weakening. The EURNZD offers a good trade, besides the fact that EURNZD shorts also attract positive overnight swaps.

The chart below depicts the trade idea. It might seem a bit confusing but its quite simple. Just follow the explanations based on the markers.

EURNZD - Renko Chart, Trade Idea

1. A triangle pattern is formed which was validated by a downside break out. The triangle gives a target to 1.5229. The break out failure is to be seen as a retracement that usually happens to all break outs.

2. I plotted a mini AML and the retracement looks to end at 1.6278. Typically prices tend to deviate after hitting the median line (and not to forget that prices hit the median line 80% of the time).

The level of 1.6278 sits right between the 50 - 38.2% retracements of the major leg down and the minor leg down. This gives us a reversal range between 1.6488 & 1.62324 and 1.6278 sits right in between these two levels, which if you look to the left has formed interim support during past rally and looks set to act as resistance to this short term rally.

3. The very light AML gives the long term picture. Price failed to reach the median line indicating a change of trend.

Putting it together, we can take a short positioon at 1.6278 targeting 1.5229. For stops, above the break of the trendline from the major AML at 1.6698 gives a total RR trade of 2.5, with the potential to make 350 Pips.

USDJPY - Bearish Flag on Renko

USDJPY - Bearish Flag

Looking to sell USDJPY on retest of the bearish flag, targeting 98.3

GBPAUD - Head and Shoulders, Renko Chart

This should be a nice trade to take on with a good RR as price retraced back to the H&S neckline. Target is set to 1.75 and stops at either of the shoulder's highs.

GBPAUD - Renko Charts, head and Shoulders

EURUSD - Hitching a ride

In the previous article, I mentioned about EURUSD targeting 1.40. In this analysis, we'll see how we could hitch a ride on this short journey.

Keeping the analysis as is and taking cues from the triangle break out, we notice a bit of retracement taking place. The most likely dip could terminate near 1.3776, which incidentally was a past resistance level. This was tested just once more recently and is likely to be tested again, thus providing a good entry.

EURUSD - Renko Charts, Trade Plan

The validation for longs also comes from the trendline confluence with 1.3776 level. So the stops would come in at one and half bricks below at 1.3651. The target of course would be 1.40 and 1.4082.

So taking two positions with the first one closing at 1.4 and the second position moved to BE and targeting 1.4082 from 1.3776 should play out fairly well.

Sugar Futures - Adding to shorts

There seems to be a bit of bullish sentiment prevailing in the markets in regards to sugar, largely attributed to a weaker than expected output from Brazil. More here. Previous analysis calling for $15 here.

Regardless of this bullish development, I still think that Sugar is poised to drop lower. So I have a new pending order at 16.77, targeting 15.10 (rounded off).

Sugar Futures Update, 24/04/14