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Contributors Trade Idea for 1st to 2nd December 2013 – EUR/USD

liquid markets

The end of the year is near but Christmas is closer with thanksgiving that have just passed and while some traders are talking about this Fridays’ Non-Farm Payroll, others are rubbing their hands in excitement wondering about what the stock market’s year-end rally would bring. So, what are we currencies traders and investors supposed to be doing in the meantime? Let’s start by being aware of some upcoming fundamentals or economic events.

The employment data expected this coming Friday, seemed to be the first most important data before the Feds meeting on the 17th and 18th of December and these two events may prove to be  major catalysts to some major market movements just before ending 2013, whilst welcoming 2014 .

From a Harmonic Patterns point of view, the EUR/USD on the 1hr chart below was a little tricky indeed since a correction occurred just before the 1.3626 level. Will this simply be a correction? ,as many would have asked. In my opinion, the measure of the current bullish trend is crucial.  The signs are still to some extend persistent on various timeframes for the Bulls to be keeping their title. However, as a Harmonic patterns trader, if I were to be trading midway from C to D, then I would find it less risky to exit just before reaching into the Potential Reversal Zone (PRZ) marked as the green box. Additionally, I would re-enter a trade for a buy only if prices have picked up in its’ trend upwards within the PRZ area. The question for now is whether the trend has reversed and when is best for us to enter a sell order?


As far as the 1hr and 4hr time frames are concerned, prices seemed to have pierced through the 200 Moving Average but for the long run like on the Daily chart, the trend is still within the bullish zone. However, if we were to enter a sell entry earlier right under the PRZ zone in expectation that the trend has indeed reversed then the ideal entry could be at 1.3570 and the take profit level at either 38.2%(TP 1), 50% (TP 2) or 61.8% (TP 3) Fibs level of C to D.

Do make sure that your SL level is applied in accordance to your Risk : Reward ratio.

Happy Pipping !

About Kenny Simon

kennysimonKenny Simon is Head of FX Training at Liquid Markets. He is a contributor for the Technical Analysis section of LQD ‘s Blog. Being a fan of the wonders of nature, he  believes that trading in-harmony with the market’s natural ebb and flow could potentially increase one’s success in obtaining Low Risk, High Probability Trades. Besides the technical aspects of his analysis, Kenny emphasizes the importance of understanding and applying Fundamental Analysis, Money & Emotions Management into one’s approach to trading the markets.




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