TRADE #5 OF STAGE 2: SHORT THE USDJPY

I am watching a possible double top on the USDJPY based upon the chart attached.

Here is my logic and reasoning.

1. When looking at the USDX, it appears as if it is going to meet an area of a little resistance around $78 as noted in the blog from 12.18.2009

2. The four hour chart shows a resistance line and I expect a short term double top due to reason #1.

I placed my entry near the resistance line at 90.59 and a stop loss above the resistance line at 91.02. This price is also a few pips above the most recent high which should be respected in a double top.

My T1 is sitting at the 38.2% Fib retracement from 12.9.2009 until the most recent high. My T2 is at the 61.8% retracement of the same move.

Again, I have come to the resolution that the two time frame analysis is what is going to work best. I am going to avoid noting the daily chart in the analysis. Thus, my HTF is the 4 hour chart and my entry was the 15 min chart.

INFO FOR ME

3218-1331 HSA
17305265 TS


http://www.forexcalc.com/ forex position calculator

http://www.investopedia.com/articles/financialcareers/06/FinancialAnalyst.asp#12893350414672&close

http://www.investopedia.com/articles/professionaleducation/10/market-technicians-association.asp

http://www.investopedia.com/articles/financialcareers/09/chartered-market-technician-cmt.asp

http://money.cnn.com/magazines/fortune/fortune_archive/2006/08/07/8382584/index.htm

http://richard-wilson.blogspot.com/2008/09/how-to-start-hedge-fund-launch-tips.html

http://www.hedgefundmarketing.org/starting-a-hedge-fund/

http://www.hedgefundlawblog.com/recommended-hedge-fund-articles-for-start-up-hedge-fund-managers.html

http://www.elitetrader.com/vb/showthread.php?threadid=207753

PEGA is showing a buying opportunity. VNR is at 52 week highs

Looking into the charts, I see PEGA as a potential buy due to the increasing

volume and breakout from a triangle on a daily chart. Click on this chart to enlarge it. There was a bottom in October 2008 and PEGA has been in an uptrend ever since. Is this a possible return to the uptrend? Let's move closer into the daily chart and see what it looks like.

I like the fact that the stock is still above its 200 day moving average which is the wavy dark blue line. I don't like the fact that the 55 day moving average is sloping down. The fact that the stock is back above its 55 day moving average makes me feel better, however. The triangle that you see on the chart with the aqua-colored trendlines is appropriate so I am going to set my buying opportunities near $31.60. Stop loss $28.98. T1 = $35.21. T2 = $37.20 T3 = $39.76

I also looked at VNR. This stock has performed very well. When panning back on its chart, one can see that this stock is at a 52 week high. Most stocks that are above this level continue to move above this level so entry near hear is great.

ARTICLE ON SUPPORT AND RESISTANCE

TraderPlanet Today

POTENTIAL SHORT ON NZD/JPY

Since the beginning of 2009, the NZD/JPY has seen a steady uptrend having begun near 44.00. It topped out around 69.50 toward the end of October. Prices have since dropped rather aggressively hitting a low of about 60.00 near the end of November (breaking through the 2009 bull trend line the process). Over the past couple weeks, price have rebounded and are currently testing near-term resistance near 65.00.

We still may have a solid shorter-term selling opportunity in the form of a double-top bearish Gartley pattern if current 65.00 resistance fails and prices move up to around 67.0 (click on chart to enlarge it). Assuming this pattern completes and no warning signs (gaps and/or long bars prior to entry) are present, we may see at least a temporary dip down to initial fib support of the projected CD leg near 65.00 (38.2% of projected CD leg) followed by 64.00 (61.8% of CD). The key will be for price to remain above point C (62.00) before reaching the projected entry of 66.80; otherwise, this specific double-top Gartley setup is no longer valid.

Potential Strategy : Sell if prices rally to 66.80 risking 67.84 targeting 65.22 (T1), 64.09 (T2).

POTENTIAL BUY IN EUR/GBP

Looking to buy the EUR/GBP if it falls to 0.8930.



Here is the chart. I am going to set one contract in at a buy limit order and then wait to see what happens. If I get a positive response, I will look to enter with my other contracts.

fx360

Going to set a buy for CTCM despite the fact that I think the market is going to falter

I am looking at charts and I noticed this one. This stock has been performing very well and as of recent there has been dimunition in the trading volume.

In the past few days, it has put in a pivot and broken this downtrend line. I have labeled the chart to show what I am talking about. My stop loss will be $0.12 below the most recent low which is $13.54. My buy limit order is going to be set at $14.92. T1 is $17.62 and T2 is 18.58. T3 will be $21.66. Let's see how this one pans out.

SPY STILL MEETING RESISTANCE

It looks like a lot of sideways movement for the SPY for a while. It is bouncing in between a rectangle bordered by $108 on the low side and $112 on the high side. Well, consolidation is good after this type of run. I day traded the SPXU which is the 3 times inverse SPY. Not much of a gain today, but commissions may wipe out my profits unless I reach the threshold with Tradestation's requirements.

I am adding my current trades to this blog to show what I did today. Click on the image to enlarge. I rolled a lot of covered calls today including those in GLD, HMSY and SLV. For SLV, I set out to sell some covered calls when the ETF reaches near $19.17. Here it will meet resistance from a previous high back in July, 2008. Click on the chart to the right to see what I am seeing.





HMSY has been behaving very nicely and there is a convergence of two trendlines at $43. I am watching this area fo an area of convergence and possible continuation of the uptrend. The blue line seen on the chart is a trendline from a low produced back in March, 2009.








I am also including my open positions so that I can keep track of them and plan for the future.

MACD HISTOGRAM

So I am checking out this website on technical analysis using trendlines. I am glad I checked it out. It is very good about pointing out areas of support and resistance and how to draw proper trendlines.

On thing that I really noticed and the lecturer kept talking about was the "m-M-m" as seen on a MACD Histogram. When the MACDH is above the zero line, the m-M-m is and obvious 1st day peak lower than the second day peak, then the third day is lower than the second day which makes an "m-M-m". When drawn with trendlines it hints at signs of turning points. Thus, this could be obvious signs of areas to move with the trend or to take profits.

If you look at the chart (click on it to enlarge it) of the forex pair USD/CAD, you will see quite a few areas that the MACDH "m-M-m" move works or is an early signal to get in on the trend or take profits. There are a lot of trendlines on the chart but I want this to show me signs of where the MACDH confirms the support and resistance trendlines.

Look at 3/31/09. You will notice that the fx pair created the ultimate m-M-m where the MACDH produced the m-M-m (marked by the circle on the MACD section of the chart) at 1.2200 and the currency pair retraced back up to 1.2714 on 4/1/2009. There was no way of me knowing that 1.2714 was going to be the pivot point. When you look at the MACDH, you can see that the zero line was never reached and pair began to head back down and entered a downtrend.

On 4/16/2009, the MACDH hit a new low and on 4/17, another m-M-m showed its head and the USD/CAD pair created another perfect pivot point. This is now the support line for any further move down in the downtrend.

So now you have the highest high on 3/9/2009 and draw a trend line from that high to the next lower high on 4/1/2009 and this will be the resistance line in the downtrend.

If you were to take a countertrend trade on 4/17/2009, one would make a target along the down-trendline from 3/9 to 4/1. Low and behold on 4/21/2009, one could see that this countertrend trade would have hit a target. The following day on 4/22, the MACDH created another m-M-m and this would be the perfect entry for a short on the USD/CAD pair.

Again and again, this chart shows that the USD/CAD met support or resistance as MACDH made an m-M-m. Thus, when these are visualized, it would be prudent to pay real close attention to trendlines for entries or taking profits.

WATCHING USD/CAD TO THE SHORT SIDE

Here is a chart on USD/CAD. It is in a definitive downtrend and the pair may be pausing. If you look at the chart you will see that the chart travelled down to the 61.8% Fib retracement. It is now at the 50% retracement. I would suspect it would end up at the 38.2% retracment and then continue its downtrend.

Let's wait and see.

Click on the chart to enlarge it.

FXC target hit. 2% profit in 5 days

FXC hit the profit target and profits taken. Thank you Canadian dollar.

FXC BUY POINT. HMSY only stock that didn't stop loss out.

So here is a chart on FXC, the ETF that follows the Canadian Dollar. I see a potential buy point near $93.75 and target of $95.50. A stop loss sits near $92.00 I am going to see if I can enter as near to $93.75 as possible.

Stocks for Monday: CTRP, PEGA, ARO, ABAX

Click on the chart to enlarge it

I am watching CTRP for a quick move. My entry is $60.04. Stock in a strong uptrend, recent retracement. Look at the chart and you will see I drew some trendlines on it to show why I am entering. Stop loss is $57.01 and target is $63.69 (a 6% move).

I am interested in PEGA in the fact that it appears to be sitting on a trendline near $32. A good entry would be the range of the previous pivot on 10/2/2009 from the range of $30.38 to $32.11. That's a wide range, but still a good entry area.

ARO also continues in an uptrend and is sitting on the 50 day EMA. It has popped out of a triangle and so my entry is $41.21. Setting a target of $45.48 with a stop loss at $39.16.
ABAX gained support at a gap. I think this will lead to better prices so I am going to set my entry near the bottom of the triangle. Entry is $25.47 with a target of $29.33 and a stop loss at $23.66.

FOREX FOR 10.23.2009

Crude Oil 81.35

+0.16 +0.20

Gold 1060.60

-0.48 -0.05%

CRB Index 282.54

0.00 0.00%

US Dollar 75.279

+0.185 +0.24%

So oil is still sitting above $80. With this rise one is looking for a rise in the CAD and GBP. However, gold is down slightly which will back the CAD back down and slow the rise of the AUD. As of 0600 MST, the USD is up.


Only a couple of dings for the USD today. So until 0800 MST does one stay away from the USD.

6:30am	USD		Fed Chairman Bernanke Speaks
8:00am	USD		Existing Home Sales			5.37M	5.10M

I am keeping a close eye on the GBPUSD as the British economy shrank for a record 6th straight quarter. If you look at the GBPUSD daily chart, one can see that the channel to the downside created over the last three months may be re-entered. If this is so, expect more downside as the USD is expected to climb this week as there is an expected 3.1% growth in the US GDP.

FOREX FOR 10.22.2009

Oil and gold are down as of 0800 EST. USD is up. This means to watch the GBPUSD, AUDUSD and EURUSD to head down.

Crude Oil 80.82

-0.55 -0.68

Gold 1057.12

-0.92 -0.09%

CRB Index 284.09 0.00 0.00%

US Dollar 75.254

+0.282 +0.36%

Expect some changes in the CAD today. Lots of news coming out so stay out of USDCAD.

6:30am	CAD		Core Retail Sales m/m			0.5%	-0.8%
6:30am	CAD		Retail Sales m/m			0.3%	-0.6%
6:30am	USD		Unemployment Claims			516K	514K
7:00am	EUR		Belgium NBB Business Climate			-15.6	-17.8
8:30am	CAD		BOC Monetary Policy Report

FOREX STATS FOR 10/20/2009

Crude Oil 79.47 -0.49-0.61%

Gold 1061.79 -3.61-0.34%

CRB Index 279.26 -0.39-0.11%

US Dollar 75.382 -0.128-0.16%

The calendar day of 10/21/2009 really does not offer any stumbling blocks to trading forex.

The USD is seeing more pressure to the downside as wholesale prices fell a larger-than-expected 0.6% in September after seasonable adjustments, with energy prices falling 2.4%, the Labor Department reported Tuesday. The producer price index has fallen 4.8% in the past year.

FOREX

I am watching a few things develop in forex and I am going to work on my skills. I am looking at GBP/USD as it is hitting a channel line on a daily chart. Since it is in a 3 month downtrend, I suspect this may hit the upper channel line and may come back down. I am going to buy a sell limit order in a 1.6490 with a stop loss at 1.6591. This is about 50 pips higher than my usual stop loss, but I need a little wiggle room. I may be pulling the trigger a little too early, but I like the set up on the chart.



I am also looking at the USD/JPY. It has been in a strong downtrend and has had an upswing. It is sitting in a narrow channel and 87.10 is going to offer huge support. This is a 200 - 300 pip move. I want my entry to be near 90.54 so I am setting a sell limit order there.

RETRACEMENTS

RULES:
1. A retracement in an uptrend will NOT drop below the previous low. (i.e. it will be a higher low) A retracement in a downtrend will not rise above a previous high (i.e. it will be a lower high)

2. Retracements occur very commonly around even numbers x.00, x.50, etc.

A Gann retracement is specifically a 50% Fibonacci retracement. At this 50% zone, price can either resume its latest dominant trend or reverse the current trend. This was his best place to re-enter a trade in the dominant trend and placing a stop loss below the recent low.

Thus we need to talk about Fibonacci retracements. Fibonacci noticed a recurring theme in nature. The sequence is as follows: 1, 2, 3, 5, 8, 13, 21, 34, 55, 89, 144, 233, etc. When extrapolated to the price of stocks, futures and forex, special attention is correlated to the 38.2%, 50%, 61.8% retracements.

Drawing proper Fib retracements is amust to accurately predict price targets.

EWM

Got another email with this info.
TRADE OF THE DAY: Emerging Market ETF Should Reward Long-term Investors
It looks like there will be higher prices ahead for long-term buyers of the iShares MSCI Malaysia Index Fund (EWM).
dailytrader@optionszone.com
Have a good day trading,
Sam CollinsEditor, Daily Trader's Alert

So I checked the options and was looking to do a calendar spread. Looking at the farthest out option I could buy and it was an April $9 contract and selling a near month October $9 call with a spread of $0.40. I couldn't believe it. The implied volatility of the October $9 call was so high it was almost the same price as the April $9 call. So I bought 100 April, 2010 $9 calls and sold 100 October, 2009 $9 calls for that spread. Total cost was $4,000. That allows me to garner only $0.08/month to break even. Yahoo!!!

VNTA

I received this email from Eric Dany Editor, Stock Prospector . Liked the A/D. Why not give it a whirl.

MY INFO

Info for me:

38623275 FM, 38631529 FM

38628670 FW, 38630224 FW

57696261

24491775

24491790

http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID1926808

mta.org Mike Carr, CMT (CO)

http://bigmoneyoptions.investorplace.com/about_big_money_options.html



WFRewards: 1221 Orig Name then Mccain4pres

WFRewards busline: 4550 wrpmllc Nobama2008



http://www.forexcalc.com/ forex position calculator

http://www.cboe.com/LearnCenter/OptionCalculator.aspx Options calculator http://www.gurufocus.com/http://www.stockpickr.com/http://www.themillionairezone.com/http://www.traderslibrary.com/ http://www.streetinsider.com/



Forex transactions:

86% invovle USD

37% involve EUR

16% JPY

15% GBP

27% of volume is EUR/USD

13% USD/JPY

12% GBP/USD

The most common pairs traded bases upon volume are: EUR/USD, GBP/USD, USD/JPY, USD/CHF, AUD/USD, USD/CAD.



The most common time periods used in forex are 10, 20, 50, 100 and 200 days.





ADX system: ADX(14) cross D- => Calendar spread using ATM call with greater than one year expiration for long, and ATM call with near month expiration for short.


Oops Trade:If the market opens below the previous day's close, buy at yesterday's low. If the market opens above yesterday's high, sell at yesterday's high.


5/20/50 system: Buy when 5 DEMA crosses above 20 DEMA, if both are above 50 DEMA. Goal is 5%. Short when 5 DEMA crosses below 20 DEMA, if both are below 50 DEMA. Goal is 5%.


See 9/22/07 posting.

Moving Average Crossovers in Forex

The key to use moving average crossovers is to first identify the trend of the market and then to only trade in that same direction. If you find a strong uptrend, then using a moving average crossover as a buy signal has more value. If you find a strong downtrend, then using a moving average crossdown as a sell signal also has more value. Use the 200 day exponential moving average (EMA) for long term trend determination. When the market is above this moving average we can consider the trend as up and only take the buys. When the market is below this moving average, we can consider the trend as down and only sell short.

We are also using a 3 day exponential moving average and a 8 day simple moving average. When the 3 dayEMA crosses above the 8-day EMA and the price is above the 200 day EMA, a buy signal is given. A sell signal is given when the pair is below its 200 day SMA and the 3 day EMA crosses below the 8 day EMA. Buy first contract 10 pips to the opposite side of the trade of the close (if there is a buy signal, buy 10 pips below the close of the prior day) Buy a second lot at the current price of the 8 day EMA. If there is a sell signal, sell 10 pips higher than the prior days close for the first contract. Then set a second lot at the current 7 day EMA price. Set a stop loss at 10 pips ABOVE/BELOW the previous 3 day high.

Then, 7 days after the entry, start setting the first stop loss at the 10 day EMA. Take 1/2 of the number of lots bought. Use this as a trend line determination and extend the line out to take profits when this trend line is violated again.
Here are the exact steps
1. Search Metastock in forex pairs for 3/8/200 cross. There is probably only 1 trade every 3 months per pair.
2. Set buy/sell limit at 10 pips below/above the previous day's close. Set second lot at the 8 day MA of the previous day that is good for 3 days.
3. Set stop loss at 10 pips below/above the low/high of the previous three days.
4. Set first target at 100 pips. Set second target (buy stop/sell stop) at previous 3 day low/high.
Simple Forex Strategy
Strategy requirements: Time frame: 1 dayIndicators: 5 EMA, 12 EMA, RSI 21



Forex Strategy: Any time frame

Entry rules: Buy when 5 EMA crosses up and over 12 EMA and RSI is above 50.

Sell when 5 EMA crosses down and below 12 EMA and RSI is below 50.

Exit rules: exit when 5 and 12 EMA cross again or when RSI crosses back through 50.




SHORT TERM FX STRATEGY:
Daily Stoch is moving up - move to hourly chart and buy when moves out of Oversold area and sell when crosses back down out of Overbought area. The reverse is true too.
Long Term Strategy: Use Slow Stochastic on weekly indices to determine trend. Use trend lines on weekly to determine up or down trend. If stoch is up on weekly, look for DAILY stoch cross-up. If WEEKLY stoch is down, look for DAILY cross down on stoch.


3 DAY STRATEGY: Determine trend by looking at pair in comparison to 200 day MA. If pair is ABOVE 200 day MA, then BUY when the high from the previous 3 days has been breeched to the upside. Set a sell limit at 100 pips above this price for one contract and a sell stop at the low of the past 3 days. Each day move the stop loss up to the lowest low of the past 3 days.
If the pair is below the 200 day MA, SHORT when the low of the previous 3 days has been breeched to the downside. One the first contract, set a buy limit at 100 pips then set a buy stop at the highest high of the past 3 days. Move the buy stop down every day to the highest high in the past 3 days.

SOLD COVERED CALLS ON DHR

DHR may roll over a little bit here so I had a 3% profit and decided to sell some deep in-the-money calls at $40. I garnered a $23.20 premium. Not bad for 5 days worth of work since the options expire this coming Friday.

Buying more SA at $20.75 has also paid off. I sold some May $25 calls for $0.30. Not much, but it is still money in the pocket.

Did you buy soem more SLV near $12.73? I did and have been rewarded. There may be a pivot showing up as of 5/11/2009. Selling some covered calls may be appropriate.

SA, SLV AND GLD ARE NEARING BUY POINTS. NEW STOCK DHR ADDED TODAY AT $59.90

I bought more SA shares today at $20.75 due to my indicator crossing over and showing a buy signal a few days ago. The $20 mark appears to be acting as good support and this stock should be rising soon.

I have also bought into a new stock with the symbol DHR. The stock has been beaten down in the past few years and as of today it is above its 200 day moving average and my indicator showed a buy sign on 4/22/2009. I got in at $59.90. The stock has put in higher lows and higher highs denoting a possible new uptrend. I hope to ride this one out.

SLV is also in a buy area. Buying near $12.73 is going to offer you the best chance of making some money. Since I also hold covered calls on the shares I already own, this means I need to roll the May contracts out to June.

5/4/2009
Buy to Close 10 contracts +SLVEL May $12 call @ $0.93
Sell to Open 10 contracts +SLVFL June $12 call @ $1.20
This reduces my overall cost by $0.135 ($1.20 - $0.93 = $0.27. Have 20 contracts so this is 1/2 of my total contracts. Hence $0.27 x 0.5 = $0.135)
Cost basis ($11.64) = ($11.775) - $0.135

GLD is getting ready to cross on my buy signal so I am not pulling the trigger until I officially get that signal. Patience is a virtue.

SOLD MAY $13 SLV CALLS

SLV may roll over and head a little lower as it looks as if a pivot was created at of the end of the day. SLV continues to make lower HIGHS and lower LOWS which are signs of a continued downtrend for the past 3 months.


4/27/2009 Sell to Open SLV May $13 Call 10 contracts @ $0.30
Again, this is the other half of my total shares so it reduces my cost basis another $0.15
Cost basis: ($11.775) = ($11.925) - $0.15

Looking at selling a deeper in the money call of FXB as it rejected the $150 mark. I will buy back the May contract and look at selling a $140 June contract.

USO MAY $28 CALL IS IN-THE-MONEY. ROLLED OUT TO JUNE IN ORDER TO AVOID BEING ASSIGNED

USO
03/20/09 Buy to Open 16 USO Jan. 2011 $31 Calls ($8.20)
Sell to Open 16 USO April $31 Calls at $1.70
Cost basis is ($8.20) - $1.70 = ($6.50)
April $31 call expired worthless.
Sell to Open 16 USO May $28 Calls @ $1.30
Cost basis: ($6.50) - $1.30 = ($5.20)


4/24/09 Buy to Close 16 +UBOEB May $28 Call @ $1.95
Sell to Open 16 +UBOFB June $28 call @ $2.70
Cost basis ($4.55) = ($5.20) - $0.75

SLV MAKNG A MOVE HIGHER

SLV
03/04/2009 Bought 2000 SLV @ $12.85
Sold 10 SLVCM March $13 call @ $0.50 (This reduced my cost basis by only $0.25 since I had 2000 shares and I sold only 10 contracts)
Cost basis = ($12.60) = ($12.85) - $0.25


Bought to close 10 SLVCM March $13 call @ $0.41Sold to open 10 SLVDM April $13 call @ $0.91 (This reduced my cost basis another $0.25 since I rolled my 10 contracts and this covers one-half of my total shares)
Cost basis = ($12.35) = ($12.60) - $0.25

April contract expired wothless.


Sell to open SLV May $12 Call 10 contracts at $0.55
Cost basis = (12.075) = ($12.35) - $0.275


4/23/2009 Sell to open 10 contracts SLV May $13 @ $0.30
Cost basis: ($11.925) = ($12.075) - $0.15



GLD LEAPs
02/26/09 Buy to Open 3 GLD Jan 2011 $100 Calls
Sell to Open 3 GLD Mar $100 Calls
Cost basis ($18.60)
March contract expired worthless allowing me to pocket the whole premium.

Sell to open 3 GLD April $95 Calls at $1.50 Cost basis ($17.10) = ($18.60)-$1.50
April call expired worthless too so I am going to wait a little bit on this one to see if the price will rise so I can sell a May call.

USO
03/20/09 Buy to Open 16 USO Jan. 2011 $31 Calls ($8.20)
Sell to Open 16 USO April $31 Calls at $1.70
Cost basis is ($8.20) - $1.70 = ($6.50)
April $31 call expired worthless.
Sell to Open 16 USO May $28 Calls @ $1.30Cost basis: ($6.50) - $1.30 = ($5.20)

FXB
Buy to Open 2 FXB Sep $140 Put at ($7.15)
Sell to Open 2 FXB Mar $140 Puts at $1.72
Cost basis ($5.43) = ($7.15) - $1.72
Buy to Close 2 FXB Mar $140 Puts at ($2.90)
Sell to Open 2 FXB Apr $140 at $4.30
Put Cost basis ($5.43) - $1.40 = ($4.03) April Put expires worthless4/22/2009
Sell to Open 2 FXB May $142 Put at $1.10
Cost basis ($2.93) = ($4.03) - $1.10