Wednesday, August 11, 2010

8/11 Forex

  • Euro, cable take a mighty dive against the dollar, with bear signals.
  • But the dollar in turn fell against the yen, and the euro does, too.
  • U.S. dollar up sharply against the loonie, peso.

Many of these signals were ghost signals yesterday, that disappeared by the close of trading. They're back today with a vengence.

ppspps openupper pivotlower pivot
EUR/USD US$1.20307 US$1.31739 aug11 US$1.33723 US$1.2493
USD/JPY¥85.055 ¥87.459 jul29 ¥88.407 ¥85.197
GBP/USD US$1.56477 US$1.585 aug11 US$1.59853 US$1.51363
EUR/JPY ¥110.041 ¥113.501 aug10 ¥115.857 ¥108.617
USD/CAD C$1.04539 C$1.02694 aug10 C$1.0561 C$1.014
USD/MXN M$12.73682 M$12.5611 aug6 M$12.99897 M$12.243647

The currency moves, clearly in response to yesterday's Fed assessment that the U.S. economy is faltering, shows a slightly convoluted reasoning.

The straightforward reasoning is: U.S. economy bad, dollar falls. Today's market reasoning is: U.S. economy bad then Europe economy worse, euro rises.

The EUR/USD pair has fallen 2% intraday. The preceding bull phase saw the price rise 2.2% over 12 days.

GBP/USD has dropped 1.4% intraday. The preceding bull phase lasted 13 days and the price rose 3.9%.

The analysis uses the daily Person's Proprietary Signal, developed by John Person, and the monthly Person's Pivot, which he also developed.

These are black box signals -- the "proprietary" means that Mr. Person knows how they work under the hood, and I don't. But they have shown a fair degree of success in identifying good entry and exit points, and I find them useful.

On the glance, "pps open" means the price at the start of trading in the United States on the day the signal appeared.

Tim Bovee, Private Trader tracks the trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decision decisions for his or her own account, and take responsibility for the consequences.

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