When I was writing this morning’s watch list a couple of the currency charts jumped out at me; both had illustrative chart patterns.
First, below is the daily chart for the March British Pound futures. It had form a triangle on the daily chart following the Nov. – Dec. selloff. This triangle was in the vicinity of 1.6284; a 50% retracement of the Oct. – Nov. rally. Pound futures had a breakout setup yesterday, an inside and narrow range (NR7) day.
The breakout setup gave today’s rally; upside breakout points to watch were the trend line resistance I pointed out (at 1.6300) and yesterday’s high of 1.6311. The first rally objective was the top of the triangle at 1.6366, then the 20 day EMA at 1.6409.
Breakout trades often create the “excess” we look for with the Taylor Technique, so I anticipate tomorrow to have a Sell Short day signal. ROC has risen to a level that corroborates this.
click to enlarge
The other I wanted to show was the Euro currency future. In the daily chart for March Euro futures, they’ve been in a downward sloping channel after breaking the mid November lows. Notice how each successively lower swing low (the blue lines) served as resistance after it was broken. Friday’s low at 1.4581 was the most recent low; whether or not it can regain that price may tell the tale as to whether it can bottom or if the downtrend is intact.
click to enlarge
This is a sample of the analysis from my Swing Trader’s Insight advisory service. For information on STI, and to sign up for a free two week trial, visit here.
The information contained here includes information from sources believed to be reliable and accurate, but no guarantee is made as to accuracy, nor do they purport to be complete. Opinions are subject to change without notice. Past performance is not necessarily indicative of future performance. The risk of loss in trading futures contracts or commodity options can be substantial, and therefore investors should understand the risks involved in taking leveraged positions and must assume responsibility for the risks associated with such investments and for their results.
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