The View Down River

[HooLee]

Quote from downrivertrader:

Just keep in mind that indicators are lagging tools. It is the price that leads and makes profits. Once price moves up on a weekly chart, then the indicator will follow.

Yes indicators that derived from price are sure lagging. It is amazing that some are able to trade using this kind of indicators along, (without price, as in "we don't need no stinky price"). I guess you can trade anything, as long as it talks to you.

But price leads only when comparing to the indicators. By itself price is neutral, is now, and is basically random. More importantly, what leads the price? Value. What is the value? How do we find the value?

[To clarify: my position is long with tight stop, my market view is weekly neutral with daily risk/reward in favor of a long position.]

 

[BLR]

Good morning everyone.

I just thought I would add my comments to the mix regarding the current position of the Euro and invite your comments.

First with the US$ Index. It has been rising steadily and is now approaching the 9149 area where it is likely to begin to head south very quickly. The close on Friday was 90.58. If this is the case we will see a little further corresponding weakness in the Euro before it begins to turn up long term.

The Euro closed at 1.1886 (cash) on Friday. In my previous posts I said that I belive we will still see the 1.1859 support area broken before it begins to move higher. There is no magic to this level, it marks the February 22 low, a level that I have as a wave b. To complete wave c of this minor correction, the Euro will require a print below this level. Nothing has changed that would alter my trading plan at present. I want to establish a long position somewhere near this level. Don't be supervised if we get a print around 1.1844. That is my projected low.

Therefore, if we see a rally very early in the new trading session, I would not be taking or, adding to any long positions. The February low will likely be taken out before we begin to move higher. It may spike lower, but not much.

As posted in the past, I am bullish the Euro in the intermediate term and expect that we will see, at a minimum, 1.2653 and possibly 1.2850+ before this correction is over. Therefore I am looking for an entry to establish a long position with some decent size (for me at least, given that I am not a central bank). I try to determine the timing of such moves as well and have projected the early April time frame for these levels (1.2650) to come into view.

Maximize size minimize risk.

All the best in tonight's session.

 

[downrivertrader]

Good synopsis BLR. I think this is a valid plan and good luck.

I would like you to consider something. I think mostly every other trader in the Euro world is waiting for that low to be taken out. It is the easy conclusion to make and more importantly the most obvious......

It has been my experience that price rarely does what is the most obvious.

DRT

Quote from BLR:

The February low will likely be taken out before we begin to move higher. It may spike lower, but not much.

 

[BLR]

DRT:

You make a good point. I tend to treat these projections with care and try to combine them with other market indications that I hope will provide me with some insights as to whether or not they are likely to work out as hoped.

However....your cautionary comments remind me of what Jesse Livermore said about trying to identify tops and bottoms:

"One of the most helpful things that anybody can learn is to give up trying to catch the last eighth--or the first. These two are the most expensive eighths in the world. They have cost stock traders, in the aggregate, enough millions of dollars to build a concrete highway across the continent. "

Isn't it remarkable that much, if not most of Jesse's insights are as valid today as they were when he was the king of the street.


Certainly I believe that we are now very close to a turn in the Euro that will last many weeks and will carry us much higher. I try to read as much of the analysis as I reasonable can during the day. For me, the information available concerning the most recent developments surrounding the dollar i.e. the Fed's decision to stop releasing the M3 money supply figures, debt levels and interest rate projections and, the March 20th start of Iran's oil bourse, suggests that we may have both the technical and fundamental forces on the side of the Euro, at least in the intermediate term.

Although I am a technical trader, it is probably also important not to lose sight of the bigger picture.

Good luck with your positions. Great journal.

 

[mephistoII]

Greetings - hope all are enjoying their weekend! I hesitate to post at this juncture since I don't have much to contribute in the way of price analysis. But I do wish to applaud everyone who expend their time and effort - especially when they are slugging it out in the trenches - to publicly state their positions and reasons for doing so. Hopefully DRT's journal will remain a non-judgemental oasis where this exchange of personal ideas and opinion is encouraged and appreciated.

This idea of market value is most intriguing, but unfortunately I really don't have a clue on how one would ascertain its true existence at any particular point in time. Within my simplistic mindset, I come up w/ two possible approaches: that value must be pegged to the current ecopolitical landscape; or, that it can be derived from the observation of price activity at previous primary support/resistance areas. I quite honestly don't possess the necessary background to analyze the fundamentals, thus, I would like to ask you, DRT, if it was the technical representation you were wanting folks to think about when you posted the "blue" chart a few days ago?

Quote from downrivertrader:

If anyone still wants to play along.....


Take a look at this chart and tell us what you see?

Again, thanks for this thought-provoking journal, and best of luck to all on the battlefront!

Regards, ... tbone

 

[downrivertrader]

Methodolgy Development

Thanks for reminding me about this....

People will see many differnent things when they look at this chart. When developing a methodology, longer term lookers may see a sustained trend. This is certainly valid and after all don't you always here how currencies tend to trend. Well if you can play in that game I admire you. It takes deep pockets and in my opinion "things change". Soros, Buffett, Gates....have at it.

What I would suggest some might see is .... a price move or thrust, consolidation, a price move or thrust (many times in the opposite direction), consolidation, continuance, thrust. Ebb and Flow like the tide that changes roughly every six hours. Sometimes flood tide will stress the banks of the river, but a reliable as the moon it recedes. Sometimes we have some really low tides, but the levels will return to equilbrium.

Now google will go from 200 to 400 and the world does not care. But when currencies make an aggressive move...well adjustments have to be made in some cases. Things that we don't even comprehend as individual traders are affecting this movement.

Now the S&P can go to the moon and the world does not really care as much. But a currency that reacts that way will have major implications.

 

[downrivertrader]

Quote from downrivertrader:

Methodolgy Development

I would like to introduce a concept that I will not fully explain here but I think it may help those of you who are trying to determine value.

Adaptive Dynamic Value (ADV)

Ebb and Flow

More to come.

 

[mephistoII]

Thanks DRT. Always scrounging for that gem in the rough, here ! Cheers ...

 

[downrivertrader]

Set up an experimental desktop for a while. Keep a 240 minute chart up. Start to try to define support and resistance and watch price action on your estimates.

Give a man a fish he eats for a day, teach a man to fish he eats for a lifetime

Quote from mephistoII:

Thanks DRT. Always scrounging for that gem in the rough, here ! Cheers ...

 

[lorenzo-vi-]

Quote from downrivertrader:

I think this is certainly the most prudent thing to do. I am a very high risk trader and in no way am suggesting you should do anything other than this. I really do not disagree with any of your strategy and explaination but........


I am long here. Let see how things work out.

Good luck.
DRT

i've attached two simple charts, weekly and daily.
on the daily you can see the trend line, as long as it will resist we'll have a buy opportunity. the fact that in these days we are so close is a bull sign IMO. what i would say regards of an eventual breaking of this trend line, is that it would lead to an increasing donwside momentum. i can't avoid to take this scenario under consideration because the indicators are all on the sell side. you're right when you say these are lagging tools, but i want to assure you that i use them as an indication of the trend's might, not as entry or exit point indicators. they are saying the trend is down so i'll be more cautious on taking the buy side than the sell side. when it'll go above 1.20 there will be another story.
on the weekly chart i can't see any good sign except for the last candle hi lows/hi highs, this is on bulls favour but for the rest ... macd below zero and stochastic on sell side suggests that more downside would be need.
however, i'm waiting for the opening to wacht out to the first movements.