The chart :


Technical Analysis

There was a nice head and shoulder pattern and parabolic sar is already negative. It seems like the Euro is retesting its earlier support line at 1.3525. The trendline up (purple) is already broken.

Trade setup
Short @ 1.3525
Stoploss @ 1.3670 (risk is 145 pips)
Target @ 1.2990 (possible profit is535 pips - risk/reward is 3.69)

PS. Our GBP/USD trade setup hasn't been triggered yet but the setup is still valid.

New possible short entry in this pair. The fundamental reason to sell the GBP stays the same - see our earlier blog post.

the chart :


Technical Analysis
Parabolic Sar is already negative. We also have a bearish RSI divergence (purple lines - lower tops in the RSI indicator and higher tops in the price chart).

Trade setup
Short @ 1.5050
Stoploss @ 1.5250 (risk is 200 pips)
Target @ 1.4510 (possible profit is 740 pips - risk/reward is 3.70)

EDIT : update 16/05/09 - 04.50 PM (European time). Our entry level is not yet triggered but the trade setup is still valid. In fact, we have a head and shouder pattern (see chart below).


Trade setup stays the same for next monday.

Have a nice weekend!

A new setup for the GBP/USD. The Bank of England announced fresh plans to buy over $150 billion worth of bonds, as neither central bank was ready to endorse the view that the economy is on the road to recovery. Britain's government had previously authorized the purchase of a total of 150 billion pounds worth of bonds, but the U.K. central bank wasn't expected to increase its purchase program at this meeting.

The chart :


Technical Analysis
Parabolic Sar is negative and we have a double top. We also have a bearish RSI divergence (purple lines - lower tops in the RSI indicator and higher tops in the price chart).

Trade setup
Short @ 1.4927
Stoploss @ 1.5110 (risk is 183 pips)
Target @ 1.4440 (possible profit is 487 pips - risk/reward is 2.63)

EDIT : Trade setup is cancelled at 11/05/09 - 09.00 am (European time).

We've spotted a nice short opportunity on the EUR/USD. Tomorrow we have the rate decision by the ECB but far more important is the ECB press conference 45 minutes later. The latest economic reports are very negative for the whole Eurozone so there is a chance that the ECB wil take more agressive measurements (quantitative easing) which could have a negative impact on the EURO.

Here's the chart :

Technical analysis
Parabolic Sar is already negative and we see al lower top. The blue arrows are two inside candles, so a greater movement is to be expected. We also have a bearish RSI divergence (purple lines - lower tops in the RSI indicator and higher tops in the price chart).

Trade setup
Short @ 1.3270
Stoploss @ 1.3380 (risk is 110 pips)
Target @ 1.2990 (possible profit is 390 pips - risk/reward is almost 1/4)

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EDIT 08/05/09 stopped out. Loss = -112 pips (spread included).

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The Forex swingtrader