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Broker: Advantage, Trading Technologies, OptionsCity, IQ Feed
Trading: CL, NG
Posts: 1,038 since Jul 2010
Thanks Given: 1,713
Thanks Received: 3,863
I'm very curious to see the COT today. This is a pure technical move for sure. In any event, we're almost to 1.39. There's a swing high at 1.3925 that will be a good test. If we get past 3970, we should get to around 1.40 +/- which is halfway back from May's high. Pretty exciting moves taking place here.
Two month ago we had EURCHF 1.01 and "fair" value should be 1.35.
Did it help my trading to know that huge difference? Maybe if I am a long term investor.
The only benefit I had as a trader was the fact that some day there would be an intervention and I could benefit if long... But in the meantime I had to fight with that long bias.
But an intervention for a stronger USD is not underway.
Ericj took for his fib in the above chart the points A-Z (blue). That's logic (high/low). Medium term memory.
I take in this early phase the last significant high point B-Z (red). Short term memory.
IMO fibos have a certain relevance in currency trading because many traders do watch them. Let's take that as a fact as I do not want to start a discussion about fibo philosophy.
Are there any rules/guidance weather the majority of EURUSD traders tends to A-Z or B-Z at this specific point? Because the majority makes the rules and not my logic.
P.S.: Ericj's 50 is equal with my 61.8 what could make that level more significant as we both watch it..
I personally would have used B-Z as the shorterm 50%s have already been broken on the last move up. Personally I think A is part of another rotation but that's just the way I look at it (not saying I am right).. That being said I've found in the EUR the market either respects 50s very well or plays with 61s by penetrating getting people to look at longs and then coming right back down for a fall.. In other words its not the cleanest.. but in more cases than not I find it respects 50s (as you drew them) very well..
Btw most of my observations are from intraday moves so feel free to make me wrong as I am always up for learning something new..
@terratec: I love that sentence, because it tells it all. Fibonacci lines are a fad, and as you pointed out, the majority makes the rule. I use confluence to determine the points.
According to my daily Fibonacci indicator, there was resistance at 1.3894, and that is where yesterday's daily high was made. This level was already known in January of this year....
The charts below show, how that resistance at 1.3894 can be established by using retracements, measured moves and expansions.