19th-23rd December 2011

As we approach the final two weeks of the year, liquidity is expected to run dry.We should therefore be very careful not to get caught in the opposite side of the market as any unexpected news announcements can cause a lot of  volatility. The Euro has been on a downward decline from last week due to the inability of the Euro leaders to come up with a solution to their unending problems and the threat of the downgrade of the two main economies Germany and France by Fitch.S&P also threatened to downgrade the two nations after Fitch had also down graded some other European nations.This, together with other factors led the US dollar to soar against against most currencies with risk aversion kicking in which also sent Gold lower and the Yen higher.This week may be a continuation of the same with the Holiday season closing in.Euro/Usd may continue to dive as it did last week if it breaks through the 1.3000 psychological barrier from last week.However if there is some pleasant news coming from Europe this week like Germany not going to be downgraded and others,we may see some retracement of some sort from this level.

The Euro/Aud has reach a major low at 2945 which may hold well for a well as it has done historically.There is nothing much expected from the Aussie this coming week and due to the market volatility at this time any unexpected news may have an unprecedented move either way on any pair.

The dollar index is widely expected to continue with its bullish momentum from last week which saw it move higher against the Canadian dollar.A break above the trend line may signal further bullish strength considering the Euro crisis and the issues concerning crude oil world wide that really affect the oil producing country.

Gold which is a safe haven currency seems to have lost its appeal and has been declining in value for a while now.It formed an ascending triangular pattern that broke to the downside last week and may continue its decline as commodities continue to lose value across the board.

Nzd/chf seems to have reached a major psychological barrier at 7187 on the weekly time frame and is now headed lower this week with the formation of two spinning tops from the last two weeks.The SNB left the rates unchanged last week and it was highly expected that they will do something about their currency to reduce its strength.We will continue to watch it as the days go buy and try to look for opportunities to sell the pair to lower levels.

We should however be very cautious this week as most traders and institutions are closing shop this week and are only working on their books to close the year.Again, unexpected news releases can easily cause volatility that may affect your account negatively.Best of luck trading and do your analysis well before engaging the market.

nzd/usd

This pair has been stuck on the 50% fib level taken from the highs of the 28th October and the lows of 25th November this year for the last 6 days.On the upper side is the 50 day moving average acting like resistance at the moment.The RBNZ statement yesterday has not set the pace for direction .The indecision candles are huge and have held the pair at this level for more than a week of trading.Lets wait and see how it all pans out.

NZD/JPY which more or less moves correlated with the Nzd/Usd pair is also caught up in the same area.

I will be watching these two pairs closely for any news or indicators for direction.A break may be big in either direction depending on news from either the Euro zone area or from the US.

H&S

Usd/Cad seems to have formed a head and shoulder pattern on the daily chart with the right shoulder seemingly shorter that the left one.Target for this would be in the 9650 if it does play out.

Intra Day action

Most of the pairs as we had predicted have eventually taken direction such as the Euro/Usd which is now headed lower but the plenty meetings this week will eventually determine the direction of the Euro.We are waiting to see if they will finally come up with a serious plan to save the 17 nation currency once and for all with proper steps in place on how to do it.
However, I am watching gbp/chf which has formed an ascending wedge and is breaking out on the 4hr.Waiting for a pull back and break to get in considering the swiss Francs weakness this last few days.

 Cable is also in an ascending wedge formation which has not yet broken lower. It is currently supported at the 50 day MA and seems unable to break the LTL of the triangular pattern.We will also watch this pair as an opportunity to gain some pips may become available.A nice candle stick pin is forming at the moment but we have to wait and see how it finishes.

Lets watch these two pairs for an opportunity to to get some pips.

December 5th 2011

It is the day the Doctors strike officially begins but for us its a different ball game.I believe it is at this time of the year that we will start to feel liquidity begin to reduce as most fund managers close for the festive season.However,I have some price action trades I will be focused on this week.The Euro/Usd which is still grappling under plenty a problem formed a major bearish candle last week and in my opinion seems to be headed even further lower unless some unexpected short term news comes out again.

Usd/Cad has a major bullish candle off the daily charts from a good support line which may hold for a while.This is a bullish looking signal for the next level 1.0250 that will act as a major resistance to the pair.

The Yen pairs have formed a bearish pin on the daily time frames which may be a catalysts for bearish price action.Gbp/jpy has moved lower from the 38% fib level from the most recent highs and lows and stuck in between the 20 and 50 day moving average.The Euro/Jpy has moved off the 50 day moving average and the seems to be headed lower if it moves past the 20 day moving average.

I will continue to update this week with more chart.Good luck to all and make sure you do your own analysis.