Friday, October 8, 2010

10/8 Forex

  • Cable again turns to bull phase against the dollar; yesterday's signal was a ghost (GBP/USD).
  • Euro turns bearish against the yen, but it is ghosting (EUR/JPY).
  • Dollar continues slide against the yen, piercing lower monthly pivot point (USD/JPY).

ppspps openupper pivotlower pivot
EUR/USD US$1.39 US$1.35 sep13 US$1.40 US$1.30
USD/JPY¥82 ¥85.08 sep22 ¥85 ¥81
GBP/USD US$1.59 US$1.59 oct8 US$1.60 US$1.54
EUR/JPY ¥114 ¥114.74 oct8 ¥117 ¥108
USD/CAD C$1.02 C$1.03 sep24 C$1.06 C$1.02
USD/MXN M$12.52 M$13.07 sep2 M$13.06 M$12.28

It is an inelegant characteristic of Person's Proprietary Signal is that it sometimes ghosts, giving a signal that later disappears, leaving behind only a Cheshire cat's mocking grin.

Such was the case with the GBP/USD pair on Thursday, when the price banged through the upper monthly pivot level (bull phase!), and then dropped back to where it began the U.S. market day (ciao, signal!).

But the Cheshire cat -- I mean, the bull signal -- is back, with the price hanging back a ha'penny below the upper pivot.

The preceding bear phase lasted six U.S. market days and produced a price rise of 0.6%.

And speaking of ghosts, the EUR/JPY pair showed bear phase this morning, but the signal quickly ghosted away. So it's still an open question whether the Euro will join the dollar in a precipitous rout in the phase of the unwelcome (to Japanese exporters) strength of the yen.

The dollar at this point is trading more than three-quarters of a percent below its level at the close of Thursday's markets in the U.S., blasting through the lower monthly pivot like a knife through tofu.

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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