unfortunately last week distractions only allowed me a cursory look at the charts and i wasn't able to update them until Mon, after which i began to wonder what downside resistance the price had hit; checking the calendar i learnt it was ECB week and that alone would have had me saying ' s i d e w a y s ' last Sat my cursory look didn't see a correction rally although it was briefly considered, but i was on Mon able to find a significant 50% fibo level that the price came within a few pips of touching - the resistance, plus a couple of projection fibos and while the price sat on the the left outer sec on May 18&19 - the Daily chart, closed just below it on Jun 7, it then as we know continued to rise this whole formation since Apr 14 is difficult to interpret in terms of waves and being able to put a count on it; at present i'm running with the idea that the May 18-19 was w 3 of w 3 (of 5 ?) so currently this rally is C of w 4 had the price hit the median line of the secs on fri it would have reached 1.24, and as time progresses the line drops, but of course it also means it's easier for the price to go thru that line to a higher price, for instance 1.25 next friday (move a vertical line intersecting the sec) so far as the 4H is concerned, the price has broken well clear of the major sec placed on it. for fibos, the 60min, using the Jun 3 HH Jun 7 LL the price has been interacting very closely with all levels of that fibo, the next HH is May 28 then May 21 but think the May 10 HH may be a HH too high; watch the price and median line if and when the price drops to the 1.17-16 area, this whole wave down since last Dec won't on the Daily look to me to be complete until it hits 1.12 time wise, an up week ? watch the Mon/Tue 3am pst and 8am pst - European close
Attached is COT for 6E. It is off the charts: Open Interest > 400K large traders and small speculators have left the game <-100K. Only Govt backed commercials are keeping the EUR propped up... but they've sealed their fate by their own short covers. FIB analysis aside there are no large traders taking longs. In the history of the EUR there has never been such complete withdrawal by the Large Traders.
i've never found COT data to be useful to me, it's also delayed weekly data not surprising that Large Traders positions have been declining for the past 3 years however if one had used the LT COT data to have entered a short in mid 2007 when the Euro was 1.35, it would have been a losing trade, the Euro rallied to 1.60 what we see with the Commercials positions are 'late' reactions when compared with the price movement of the Euro, particularly the decline that began in Nov 09 not surprisingly that the OI has increased as has the daily V, given the speculations on whether the Euro will continue to exist, never mind it's declining price/value 'business' Has to hedge currencies when the price/value of that currency rises, then reduce hedges as the price/value of that currency declines; inversely metal producers hedge when the price/value of that metal falls, reduce when the price/value rallies "It is more important to note whether the large speculators are net long or short in specific commodities or currencies. Sometimes, moves can also be influenced by small traders closing their losing positions. Knowing whether large speculators have been net long or short a few days ago only indicates the positioning in retrospect. It is more useful to compare the latest net positioning with that from the past few weeks or months. For more information on the use of COT in forex trading, refer to Chapter 5 of '7 Winning Strategies For Trading Forex' by Grace Cheng." and charts: http://www.dailymarkets.com/commitment-of-traders/ trading the COT: http://www.thepitmaster.com/cot/cot.htm COT indicator for MT4:http://www.cot4metatrader.com
can the rally continue to the 38.2 (1 of 3) around 1.2650 ? the price crossed the secs Daily median line on Fri and i don't see a reason why it shouldn't continue to the 38.2 and outer sec 3, however my time targeting does suggest this coming trading week is a change of trend week, so keep an eye on Tue/Wed although the price could spend the week going thru a reversal formation so far as the 1.1875 bottom goes, the Tue L could have been the aggressive A of an AB hence the fast rally; there's also a reasonable 5 wave count to the Apr - June decline so the possibilites of the current pattern is it's a w 1, or A of an AB major reversal bottoming formation after the price drops back down to the 1.1875 area, in turn leading to a correction of the whole downtrend from last year's 1.51s; and finally the idea the rally is C of w 4 that once completed would mean new lows coming a note that 1.19277 and 1.18048 horizontal lines represent a band of SR
not sure if the price is going to run up to the 1.2460 area again or even 1.25 then early Tuesday decline down to the 1.2150/2130 area by the week end, which could be the makings of a w 1 ABC 2 with a 3 to come as you can see the consensus range is Large: . . . . . . . . . . . . . . . Prior . . .Consensus . . Consensus Range NFP - M/M change 430,000 . . .100,000 . . -165,000 to 431,000