How is EUUSD compare with GBPUSD?

 After going through GBPUSD, I am curious to know how EURUSD is doing, after all this is the other forex counter that I took interest in.

 EURUSD weekly chart

Unlike GBPUSD, EURUSD is clearer in its direction, not only that it broke away from the moving averages, it even reached the 61.8% retracement and projection support. It is also clear that EURUSD has broke out of a double top with target of 1.10630.

Now it makes me wonder, Is the European Union doing worse than Great Britain? 

Anyway, it is more interesting to discuss what might come next for EURUSD. 

A hammer is formed at the support level. Is this a sign of reversal? While a potential sign of reversal, it is small to indicate a significant relevance. Further more, there is a strong momentum downward prior to this reversal. 

The chance is a correction before EURUSD continue its down trend. The coming week's bar is important. A strong momentum upward will indicate a reversal while a short bar with possible overlap can indicate a small congestion. The worst case would be a long a slow climb back up until it is resisted by the descending 55-week moving average.

For the time being, I will still consider EURUSD be on a down trend with possible limited down side. I will need to wait for a correction to complete before trading down.

I think EURO in BIG trouble

I was a little slag after Monday, mainly because I have bought DVD on a crime series Criminal Minds. Well, one thing that I haven't revealed here is that I am also a fan on crime stuffs, especially on serial killers. I was hooked on the DVD the whole night last night until the point that I did not even switch on my notebook (naughty, naughty).

Talking about serial killers, they are an interesting bunch of people. Most of them are male and they experience traumatic childhood (with the exceptional few. Contrary to standard beliefs, no, they are are influenced by sexually explicit materials, in fact, the hook on these materials are the effect and not cause of their destructive behaviours. Most of those who were abused by the female side of the care givers would normally come to hate women, while those abused by males would vet their frustration on the males.


Fig 1 EUD USD Weekly Chart

I have been all the while focusing the EUD based on SGD. Already I have witness a great fall against SGD. Since I have not much to look at today, I opened the USD layout and took a peek at EUD. It is quite shocking indeed!

What I saw was a double top formation with the chart already penetrated the neckline. While both indicators are at bottom they continued to move south, indicating more bear movement on this currency. Definitely something is wrong with Euro at the moment.

Using Fibonacci projection, I gather that EUD must at least reach 11,540 before retracing, which coincide with the 23.6% projection. the Double Top formation on the other hand is not that friendly, it is heading for 8,958, meaning EUD1 = USD0.8958. This is probably due to USD strengthening while Euro weakening at the same time.

So it is definitely not a time to buy Euro yet.

Talk of the town today -- the Euro

I am still not very well but I am back at work today. It has been grulling 8 hours until the time to knock off. the whole day I have been in process of writing up the speech to the presentation that I have created. It is not for me but to the presenter, I actually created a presentation for someone else to present.

Anyway, things have not been quiet nor mundane at the stock market, STI for instance dropped more than 2% to below 2,800 level, beyond my expected level. But then, this entry is not about STI. EUD is the talk of the town today.


Fig 1 EUD Monthly Chart

As it went, Germany introduced measure to curb naked shot, ending up causing panic over all markets, including the devaluation of EUD.

Base on my last entry on EUD, I was expecting about SGD175 level to be the objective of the fall, this was base on its 61.8% Fibonacci retracement line. Certainly dropping to a level of 170 is a little out of my expectation. However, 175 was just a reference created from Fibonacci calculation and it is not as strong as support line.

While saying so, I was expecting EUD to at least rebound towards the neckline before continuing down to its objective created by the double top formation. So it seems to me now EUD is in process of the C wave.

The objective of the double top is 162.436 while there is a support at 165 region. I gather that there should at least have a short pause by the time EUD reaches 165.

Anyway, the indicators are both at over sold region and they have remained there since they reached the bottom, monthly and weekly. By right a rebound should be at the corner and since I am using a monthly chart, the rebound should not be an event of just a few days.

The Euro Dollar up-date

I have left EUD for some time. My last entry on this counter was before its further deterioration. There was a warning from the the 3 black crows to stop me from buying the Euro. Greece event has definitely taken its toll on Euro, it is however quite a wonder that the chart gives advance warning about the incident. So the charts do tell fortune afterall. But just like any other forms of fortune telling, it relies on probability.


Fig 1 EUD Monthly Chart

This time round, I am using a top down approach to look at EUD. I first make use of Elliott's wave strategy to determine its position. It is a little unfortunate that I have 2 sets of count, limited by the complexity of the B wave.

The first set of count considered an ABC wave have been completed followed by an X wave. The present downward movement is actually a new A wave. The reason for this is that the C of the first set of three wave is of equal length as compared to the A of the set. B itself already contains 2 sub-sets of three waves.

The seconde set of count assume that the C and X wave is only part of a huge B wave, making the present wave a C. If I base on this assumption, the C is a little too long compared to A. Nevertheless, the C wave is of 5-wave formation. If this does not fit the profile that well, why an alternate count? The reason is a double top formation which provides an objective of 162.618. This count will allow EUD the possibility of fulfilling the objective with a B wave to retrace back to the neckline at 192.074 before plunging to its final destination.

But no matter what, the next wave is an up trend, the only difference is the up of the set wave count is longer. The question is: when the reversal?

Adding on with the Fibonacci retracement using the Bull 5 waves as reference, EUD is already close to its 61.8% retracement line (175.346). This allows me to assume that it has some way to go before it reverses.


Fig 2 EUD Weekly Chart

Already the indicators RSI and Stochastic are at the bottom of the chart for Monthly, Weekly and Daily Chart ( not shown), so EUD is itching to move up. The only problem is that the candlestick on the weekly chart shows an opening Marubozu candlestick which is bearish in tendency. This will however coincide with the assumption that it is close but not yet reaching the bottom.

If EUD should be climbing up, the resistance levels are at around 184 to 186. Support would be the 61.8% Fibonacci retracement at 175.346.

The dilema of buying Euro

In my last entry on EUD, I mentioned my hessitation due to three black crows. Seems like I was right in my reading the last round. Since then I have been checking up on EUD to see if there is a possibility of reversal.


Fig 1 EUD Weekly Chart

As I am reading this chart, I am becoming more skeptical. If base on the swing move, EUD is almost at its destination (178.424). Yes, the indicators are right a the bottom and looking like they are processing a divergence. So this would mean a reversal up, wouldn't it?

The problem is here. Between 2003 till Sept 2008 formed a huge double top. It has broken the neck line before but for some reason, it reversed back up. This time round, it penetrated (sound dirty) the neckline again and went even further south. The objective of this HUGE double top is 162.356.

So should EUD reversel up again, it is likely to be resisted at theneckline of 191.871.

So what to do? Plan a tour to Europe next year, starting with Greece.

The EUD SGD Delima

When I saw what happened to EUD on weekly basis last night, I was quite excited. Basically, EUD on weekly basis has created a 2-week reversal pattern (more of less).


Fig 1 EUD vs SGD Daily Chart
Both the Stochastic and RSI also supports the reversal pattern. RSI especially is showing a divergence indication. So I should have confidence in EUD moving north.


Fig 2 EUD vs SGD Monthly Chart

However, just to make sure before I actually start converting some SGD into EUD, I looked into the monthly chart to make sure that it is at the bottom. Unfortunately, it is not that pleasent with the monthly chart. I am seeing three black crows. This is an indication that the counter is still on a southern trend. The only consolation over the whole matter is the indicators are reversing at the bottom. But it could still mean some more southern moves still for probably a month or 2.

My interpretation so far might be that EUD will be doing a correction with retracement from 23.6% ( 192.27) to 32.8% (195.61). If this is the case, we are only looking at a margin of 6%, this excludes the commission for exchange. So the delima here is, to go in or not to go in?

Now EUD looks tasty

My last entry on EUD versus SGD in Fevuary was quite negative. Eventhough the indicators are at the bottom, for some reason, I still hessitated. It turned out I was right then. So can I consider this intuition?


Fig 1 EUD Versus SGD Weekly Chart

Looking at the chart again, this time, EUD looks more tasty to me. The indicators are all turning up with divergence to the currency. Better yet, it has a 5 wave formation. The only thing I find concerning is that the 5th wave is a little short.

However, with such a 5 wave downward, I can safely note that the next wave would be a zig zag B with retracement of probably 61.8%?

Is EUD into long overhaul against SGD?

Recently I found that the waves on many charts are very BIG, they are in fact HUGE! To some extend I could not believe myself while I made counts on some of the counters.


Fig 1 EUD Weekly Chart

Take for instance EUD, I actually zoomed the whole chart out to be able to see the whole pattern. This is due to some difficulty in interpreting from a single wave. I ended up with the beginning of the counter trend in 2005, gone down with a wave by 2006 (its a 3-wave because the 4th violates the 1st if it is a 5-wave), its b wave took 2 years to complete ending in 2008 followed by a c completed in end 2008.

One might think that this would be the end of it and now should be a new set of waves. The problem is this wave is damn choppy ending up with a 3-wave movement of X. The present down trend thus would be a new A wave.

From the looks of it, this time the wave is of a 5 wave pattern. It is in the process of creating an extended 3. Its fall is steep and led to a steep decline of its indicators. So where are its support?

I did a Fibonacci projection from the beginning of its 1st of 3rd wave to the 3rd (it is presently completing the 5th of 3rd). The EUD is presently stopped at the 38.2% projection level. I guess it should be rebounding by next week. The chances are high because indicators are reversing although no divergence yet. However, I did learn that sometimes, there is no divergence for a reversal. So let's cross our fingers on this.