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Sunday, December 30, 2012

Annual Trading Reviews on Major Pairs (2012)


EURUSD

Primary trend: Bullish

From January to February 2012, the EURUSD went up. Then it fell by over 1400 pips, i.e. between February and July. Since then the EURUSD has been caught in slow but steady bullish pressure. From July to September, the pair rose by more than 1000, before it consolidated slightly to the downside. The consolidation to the downside took place between September and November – something that saw a loss of over 400 pips. Right now, the pair is upwards, and as a result of this, we have what can be called a Bullish Confirmation Pattern. Clearly, this is a bull market.

 

USDCHF

Primary trend: Bearish

There has been some perpetual bearish pressure on the USDCHF, showing the bears’ hegemony. From January to February 2012, the price fell by more than 600 pips. And from that period till April, it was in an equilibrium mode. Then it rose by over 800 pips (that was from April to July). Since then, the price has fallen by close to 800 pips. Yes, this is a Bearish Confirmation Pattern. Nevertheless, one should note that the price is going towards a major psychological level – something of a recalcitrant accumulation zone. The zone is the price level at 0.9000.

 

 

GBPUSD

Primary trend: Bullish

The Cable has been volatile in the year 2012; extremely volatile. The price actions included sharp declines and well as northward upsurges. From January to April 2012, the price rallied by over 1000 pips. After that, the price plunged by more than 1000 pips, especially in the month of May. From May to September, the price rose by another 1000 pips. Then it fell by another 400 pips (from September to November). Currently, the price is engaged in some northward attempts, though in a volatile mode. What is happening right now shows that buying pressure is extant.  

 

USDJPY

Primary trend: Bullish

This is a bull market, a significant bull market. One should not assume that the market is overbought, because it has much room to go. From January to March, the USDJPY rose by more than 600 pips. It then fell by 600 pips (Between March and May), and range-traded from then till July.  Since July till now, the price has shot upwards by over 800 pips. While some indicators are showing overbought conditions on this pair, the price continues going upwards. One reason for this is because of perpetual weakness in the Yen. It is likely that the price would reach the resistance zone at 87.00.  

 

 

EURJPY

Primary trend: Bullish

From July 2012 till now, the EURJPY has moved upwards by more than 1800 pips, whereas from April to July, it fell by over 1600 pips! The bullish outlook is still valid. We should also note that, this same cross rose by close to 1400 pips from January to March. All JPY pairs are bullish, just as it has been said earlier. One wonderful thing about this unique class of pairs is that, in most cases, the weakness in the Yen would signify bull markets on all JPY pairs, while the strength in the Yen would make the pairs plummet. That is why those who trade JPY pairs can make hefty gains if they are caught the right direction.

 

 

 

Conclusion: It would be assumed that the current market biases would continue going as such, until there would be some confirmed reversals in the markets. When this happens, the bearish runs would be noteworthy. Moreover, the markets tend to skydive (go southwards) more rapidly than they shoot up (go northwards). To make the markets go upwards, there is a need for more buying pressure, generated by bulls, so that they can offer higher prices than the existing speculators. This scenario also has its boundaries. As soon as shorts trades are called, the boundaries would not matter as such. Please do not forget that you cannot outwit the markets. However, you can become victorious if you know how to truncate losing trades and allow winning trades to run.

 

This article is concluded with the quote below:

 

Only if I learn from my mistakes and look for the reasons why I have missed certain sharp price movements can I improve my trading!” – Faik Giese

 

 

 

Azeez Mustapha

 

Forex Signals Strategist, Funds Manager &Coach

 


 

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