Eur/USD Long term

[Kingdom2008]

Anyone have any thoughts on buying the Eur/USD long term? On the weekly chart its at the bottom of a nice wedge and the macd is turning bullish (see attached)

And on the daily there is negative divergence on the RSI and the macd (see attached)

looking to buy around 1.21950 stop loss 1.19900 (205pips)
and Take profits at 1.34300 (1235 pips)

Risk:reward = 1:6 (approx)

Thanks
Rob

 

[tomorton]

Hi Rob.

I have been looking at this too. Its certainly approaching a clear rising trendline which is multi-year, so we might see the sideways consolidation that has recently set in continuing into 2015. I have ceased shorting this pair until the picture clears but my trend-following rules won't let me go long until we see confirmation - at the very least, price closing above 200EMA.

Its possible you might be calling the start of a bottoming formation and if you're right, it would be easy to see ranging lasting through all of 2015.

However, the power of the US to drive up the $ and the repeated failure of the ECB to drive up the EUR raise the spectre this could quickly drop to parity, 1.00, on news from either/both sides of the Atlantic.

 

[Kingdom2008]

Yeah some confirmation would be nice on the technical side, I think you will be waiting a while on the 200EMA though as its almost by my target at the moment!

Its the break out of the wedge that concerns me as like you i think it can end up around the 1.1-1.15 price within a couple of years looking at fundamentals.

I might look for a pin bar break out through one of the support lines for confirmation but without it i would still be confident it will reach the 1.33 mark during a range movement through 2015 before a large drop.

Thanks for your input keep me informed of any updates

 

[E_rik]

Hi, guys I think eur/usd has become a dangerous pair to trade on. It has been falling since May now and it is still expected to go down further, considering rate hikes in the U.S and the weak European economy. We saw some kind of improvement in recent German data such as ZEW economic sentiment, Flash Manufacturing PMI and GfK German Consumer Climate which is hinting towards a marginally better economy. I am mentioning Germany because it is the driver in the Eurozone but the euro is not going to go up unless the FED's think a very strong dollar is dragging the economy or if the inflation gradually picks up (which could take a year at least). Let me know your thoughts.

 

[tomorton]

Agree with that E_rik - my last good trade on this pair was late October. The TA says sideways but fundamentals say down, and I don't see either changing significantly before mid 2015.

 

[forker]

Curious why you care about the long term view. Trading with that sort of view in mind would require a significant virtual or physical stop to allow fluctuations. Personally I never look at fundamentals and just focus on the process and short term opportunities

 

[tomorton]

But forker, surely it depends on your chosen trade TF. If you're trades will be closed in minutes / a couple of hours, a long-term view might be 3 days, and the 200 day EMA will be irrelevant.

For myself, I can most days only open trades and adjust stops/limits at EOD (London): I'm actually hoping to get into trades that I can run for a couple of weeks. OK, my stops are maybe hundreds of pips out from entry, but so are the targets.

 

[MajorMagnuM]

a map im looking at atm

 

[Kingdom2008]

Hi guys thanks for your input, you have all mainly talked about fundamentals which is what i tend to neglect when making trades so I appreciate that

Forker I am looking for long term as it suits my lifestyle better, I am very busy with family and work and having a long term trade just means I can buy in to a couple of trades and forget about them for a few weeks/months also to be honest I enjoy a dabble and found that I enjoy trading more than I do sports/poker etc

Updates on the chart is there is a reversal head and shoulders pattern on the daily


So most things technical say buy around this area (1.222) and look for at least 1.28 but fundamentals say its risky! The week end has come at a good time to take a breath a evaluate...

 

[csc2009]

We are going to see profit taking for the rest of the year, should trade with caution.

 

[forker]

But forker, surely it depends on your chosen trade TF. If you're trades will be closed in minutes / a couple of hours, a long-term view might be 3 days, and the 200 day EMA will be irrelevant.

For myself, I can most days only open trades and adjust stops/limits at EOD (London): I'm actually hoping to get into trades that I can run for a couple of weeks. OK, my stops are maybe hundreds of pips out from entry, but so are the targets.

I was mainly referring to fundamentals but also the general idea around viewing the daily time frame as a chart where few trades are placed a year. Maybe it is just me not having tolerance to wait weeks or even months for a trade. You can take about 5 to 8 trades per pair per month on the daily time frame if you didn't approach using a trend strategy. Spend a few hours looking at some charts through the eyes of trading bars not trends and you might be surprised at what you find.

 

[forker]

Hi guys thanks for your input, you have all mainly talked about fundamentals which is what i tend to neglect when making trades so I appreciate that

Forker I am looking for long term as it suits my lifestyle better, I am very busy with family and work and having a long term trade just means I can buy in to a couple of trades and forget about them for a few weeks/months also to be honest I enjoy a dabble and found that I enjoy trading more than I do sports/poker etc

Updates on the chart is there is a reversal head and shoulders pattern on the daily


So most things technical say buy around this area (1.222) and look for at least 1.28 but fundamentals say its risky! The week end has come at a good time to take a breath a evaluate...

I am also but trade the daily very differently than anyone has ever discussed

 

[tomorton]

I was mainly referring to fundamentals but also the general idea around viewing the daily time frame as a chart where few trades are placed a year. Maybe it is just me not having tolerance to wait weeks or even months for a trade. You can take about 5 to 8 trades per pair per month on the daily time frame if you didn't approach using a trend strategy. Spend a few hours looking at some charts through the eyes of trading bars not trends and you might be surprised at what you find.

Its true I often can't find an entry point on a major pair in a whole month. Right now, I only have eyes on 8 of the 16 majors, I already have trades open on 3 of these while I consider another 3 good candidates - though I probably won't be taking more trades right now as they would correlate too closely with what I've got open already.

I have traded the FTSE100 and other indices using daily bars in defiance of trend - but it didn't end well for me. If you are making money doing this, fair play to you, but I need the safety net the underlying trend offers.

Plus, I'm attached to a somewhat eastern philosophy - attack where your enemy cannot defend: defend where your enemy cannot attack. To me, that's clear encouragement to be long (only) in an uptrend or short (only) in a downtrend.

 

[forker]

You don't have to be in defiance of trend to trade bars. But each to their own I guess