Forex Analysis Report - 27 January 2008 (night)

Hello my friends

We are at the beginning of a new trading week. The first thing I’d like to suggest you is reading the article I written about setting the stop loss and limit orders. Stop loss and limit orders have been one of the most common questions I have been asked by you. Many traders lose just because of wrong stop loss orders which become triggered before the price goes to the direction that they predict. So It is important to know how to set the stop loss order.

Another article that I have promised to write is about support/resistance breakouts. I hope I can write it very soon.

Fundamentals: Coming!

1. Euro against US Dollar (EUR-USD)

The Friday candlestick (in daily chart) is a Bearish candlestick that retested the Bollinger middle band as a support but has been almost successful. Those who have a long position according to the daily chart have two options. They can fix their profit right now or they can have an eye on 27th and 28th candlestick. If any of them went lower than the lower price of the 25th (Friday) candlestick (thick red line) they have to close their long position immediately otherwise they can be hopeful that the price has been just playing around the Bollinger Middle band and will keep on going up then.

The 4hrs chart shows more details from the battle of the price with the resistance. Last week it went up, broke the 61.80% level but went down, retested the 61.80% level as a support line and succeeded to break it and go down. Now it is going up to retest it as a resistance. If the 61.80% becomes broken up, the price will go up, otherwise it will go down.

One hour chart also shows more details. I have plotted the Fibonacci levels on the one hour chart from 15 Jan 14:00 (GMT) to 22 Jan 8:00 (GMT). As you see the levels have worked as support and resistance several times during this period. Currently it is going up to break the 61.80% level as a resistance. If it breaks up, the price will go up otherwise will go down.

 

2. US Dollar against Swiss Franc (USD-CHF)

It is inside a descending triangle and we expect it to break down because there is a downtrend before the triangle.

The 4hrs is showing the down side strongly. So the EUR-USD should go up.

3. British Pound against US Dollar (GBP-USD)

It broke up the channel last week but Bulls didn’t show a reasonable strength to take the price up. It is going down to retest the broken channel as a support. It may break it down or may keep on going up.

Currently is not clear if it will even touch the channel or not. In case it goes up, if it breaks the high price of the Jan 27th candlestick (the horizontal thick green line), it means it will go up and Bulls are stronger.

The 4hrs is showing that the price is going down to retest the broken channel as a support.

The one hour chart is the biggest help right now. The price has been inside a channel for the past several hours. The channel breakout shows the future direction of the price. Currently it is going down to retest the broken 100% level.

4. US Dollar against Japanese Yen (USD-JPY)

In the daily chart, the last few candlesticks show indecision and Bulls and Bears have almost the same power. Specially the 24th and 25th Jan candlesticks. The 25th Jan candlestick tested the Bollinger middle band but failed and went much lower than its open price. So it is possible the Bears take the control because it seems they are still very strong.

4hrs admits that Bears are stronger but currently they are fighting with the Bollinger middle band. If you don’t have any short position, you should wait and if the price goes lower than the low price of the 27 Jan 20:00 candlestick in the 4hrs chart (the thick small horizontal line), you can go short.

The one hour chart shows the small support line with more details. You can use it to take your position sooner.

5. British Pound against Japanese Yen (GBP-JPY)

The 25th Jan candlestick in the daily chart says that Bears and so the Bollinger middle band which is working as a resistance are so strong.

And the 4hrs is strongly Bearish and admits that the price has a strong tendency to go down. But we have the 23.60% level on the way that will work as a support (210.22)

The one hour also admits the down trend but the 38.20% level (210.44) is on the way.

6. Euro against Japanese Yen (EUR-JPY)

It has the same situation as the GBP-JPY:

The 4hrs shows that currently the price is fighting with the Bollinger middle band to break it down. It is still too early to say if it will win or not.

The one hour says that 38.20% level is broken and so the price will go down.

Check back for more currency pairs!

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