Inside the Currency Market: EU Levels

The fact that EU broke the all important line of demarcation that signifies long to short at 1.3214 Wednesday after the release of the FOMC minutes, now says we have a short EU market. We are now in sell rally mode.

Many tout the 1.3240 level to sell corrective pullbacks. This level is a minimum pullback since its only the 5 day average target. 1.3188 was yesterday's 50 day average target so hence the reason for its technical significance today. More importantly, 1.3185 was yesterday's 100 day average level so its break is another statistical significance. Further, this break will call continued EU levels in coming days. My target at this level is currently 1.2956 but will change slightly this morning before market opening.

Current EU levels are bounded by my rock solid probability bands at 1.3351 above and 1.3080 below with historic technical significance at about 1.3064. My bands change at a rate of about 20 pips daily so current levels are close until market opening when exact levels are re recorded for the day. For now they represent solid buy/sell levels and should be employed as a guide.

On a longer term, historic basis dating back to Jan 1 1999 when EU first began trading, 1.2830 is not only the longer term target but it just appeared in my MA set up Feb 14. We may see this level touted in coming days as a target.

For now, 1.3285 should we see that level is a solid statistical sell point.

My target for now is 1.3147.

I'm Brian Twomey author of Inside the Currency Market

8 members like this

Comment by Luke Sierpniak on February 22, 2013 at 12:41pm: Nice one Brian, will keep in my mind

Comment by Brian Twomey on February 23, 2013 at 1:09am: Peter, Hearty,Congratulations to win the valuable member award

Comment by Peter jcp on February 23, 2013 at 9:15am: Thank you Brian - I was genuinely surprised - and had been delighted just making the final nominations. I am sure I don't know half of what you know about the currency market - but I hope my unusual way of trading the forex market along with stories related to my own journey have entertained many members - and even helped them winning more pips ;-))

Enjoy your weekend

Regards

Peter

Comment by Brian Twomey on February 24, 2013 at 12:37am: Candlesticks: two lines connected by color sold to traders by elite authors. Proper name:Frequency Distribution, specifically Box and Whisker Plot, box is the body, whisker the wick held together by a median line and normally measured by 1 standard deviation. Andrews and Babson saw this 80 years ago in invention of the Andrews Pitchfork. Children can construct one easily. Daily candles are predicted by either Andrews or a simple SD formula so no need exist to search patterns that don't exist, won't materialize. Attack the price, forget the pattern.

Comment by Lisa on February 24, 2013 at 1:38am: I don’t know Brian,

people tend to be predictable and repeat themselves

(some more than others, over & over & over again) same ___, different day.

Anyhow, repeatable patterns that may not be exact, but similar enough to identify.

“I see patterns” like the 6th sense ~ lol

Hope you’re having a great weekend,

Lisa ♥●•٠·˙

Comment by Brian Twomey on February 24, 2013 at 2:02am: I'm the same Li, I found my methods then perfected it and moved to the next level but always improving as I went along. Never comfortable, that's the trap. Took many years to now reach my levels. I like your 6th cents comment, that says alot of good about you.

Comment by Brian Twomey on February 24, 2013 at 12:17pm: Paradox of Thrift: Outlined in Inside the Currency Market, employed by CB's till Euro introduction and asks the question at what point is savings and investment at equilibrium with interest rates and the money supply,called the IS / LM Model and is Keynesian. IS: investment, savings measured vertically vs income on horizontal axis. IS/LM, Investment Savings and Liquidity Preference for Monery Supply Model.

Comment by Luke Sierpniak on February 24, 2013 at 3:05pm: Hi Brian, have an opinion on EU:Look for resistance on monday european session on EU @ friday's highs, i f break then we'll probably test 3290 levels, which could set up for good shorts from there, we could also see a rejection @ 3250 area and target 3100 for a new low this year, it had up momentum on friday therefore I see those numbers being tested before we resume our selling,

Comment by Brian Twomey on February 24, 2013 at 3:42pm: Hi Luke, My EU bands are now 1.3333 - 1.3078, reported in this article Thursday was 1.3351 and 1.3080, topside dropped by 18 pips, 2 pips below, 20 total. This is your solid range. My Friday buy/ sell targets 1.3204, 1.3241, 1.3282, 1.3184, 1.3298, 1.3271. The average of the Friday move was sell at 1.3220. The 100 day average across all pairs is out of alignment and containing price moves. For example, Wednesday 20th: 1.3090, Thursday 21: 1.3185, Friday 22: 1.3191. Its not falling in line with other averages so until it occurs, price will slosh around and do nothing. My current sell level is 1.3285 but may change a few pips by market opening. So don't bank on that 90 level yet nor be sold on 50. But definately looks to be heading lower from here

Comment by Brian Twomey on February 24, 2013 at 3:47pm: Hi G Singh, I'm in shock levels didn't hit but offer apologies, gold lost its risk correlations and became this free floating instrument without direction or cause. Monitor money supplies since that's traditional gold movements. Will report new levels

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