Posts from: April 2012

Forecast for the week 30.04.2012 – 04.04.2012

In the period from April 30th to May 4th, there will be published a number of key macroeconomic indicators, which may have a significant impact on the sentiment of the world financial markets participants and the Dollar’s positions. First of all, on Tuesday and Wednesday (May 1st and 3rd), the reports on PMI from the Institute for Supply Management in the industrial and non-productive sector will be released. On Friday, May 4th, the Bureau of Labor Statistics will provide the data on the number of newly created jobs in March and the unemployment rate. If they open the optimistic prospects for the U.S. economy, the Dollar’s reaction may be positive against the expectations of the tightening rhetoric on the monetary policy of the U.S. Federal Reserve, and the moderate optimism will contribute to the weakening of the Dollar.

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Review of the trading week 23.04.2012 – 28.04.2012

The Dollar started the week with a sharp rise during the Asian session on Monday, April 23rd, but then again came under pressure on the expectations of the next meeting’s outcome of the Federal Open Market Committee of the U.S. Federal Reserve. Moreover, Mr. Bernanke’s press conference, where he hinted that the further easing is not currently considered, even more weakened the U.S. dollar’s positions. The USDX Dollar index, which is the ratio of the U.S. currency to a basket of six major world currencies, lost 0.7% closer to the closing of the week. The Dollar’s positions also weakened because of the unpleasant negative “surprise” in terms of the GDP growth for the first quarter.

After falling to the mark of 1.3100 on Monday morning, the EUR/USD pair formed a strong upward momentum to the area of 1.3235, taking advantage of the weakening Dollar on the entire market. It never finished the week in an attempt to overcome this mark.

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Comments on the losing trade on 26.04.2012

In the night from Thursday to Friday, after the closing of the U.S. trading platforms, the rating agency Standards and Poor`s published news on the rating downgrade of Spain to BBB +, which caused an immediate reaction from the market, and as a consequence, the EUR/USD pair fell by 80 pips. This sudden movement during the Megadroid trading session triggered the opening of two tradings, one of which was closed by a stop loss of 60 pips. The stop loss was set at the minimal size due to the small amplitude of the previous day.

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The basics of technical analysis of the Japanese candlesticks (part 3)


The shape of candlesticks can be one candlestick or multiple candlesticks, rarely more than 5 or 6 of those. However, the Japanese literature gives references to the links of the shapes which use even a greater number of candlesticks.

Most shapes of candlesticks have their own kind, which means that for every bovine shape, there is a similar bearish shape. The main difference is in their position with respect to the short-term trend of the market. The names of the bovine and bearish shapes can be or cannot be different.



The hammer The gallows
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The basics of technical analysis of the Japanese candlesticks (part 2)

Today we shall learn the remaining singular shapes of the candlestick analysis.

The lines of candlesticks (continuation)


In the Japanese language, Marubozu means “cut at the closing.” Other interpretations refer to it as “a bald head” or “a shaved head”. In any case, the value reflects the fact that there is no shadow extending from the body both at the opening or at the closing, or from both sides.


Black Marubozu is a long black body with no shadows on one side. It is considered an extremely weak line. Often, it becomes a part of the bearish continuation (a part of a downtrend) or a bovine fracture shape, especially if it occurs at the lower trend. This line, as it is black, shows the continuing weakness of the lower trend. The long black line could mean the last sale, which is why it is often the first day of a bovine fracture shapes.

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