Category Archives: EURAUD

EURAUD 60 minute – Starting to Trend

Median Line Analysis using pitchforks seeks to identify and define trend at an early stage so that analysts and traders can then follow the strengthening and weakening of price over time. By determining the path of price we are able to anticipate likely areas of support and resistance with great accuracy.

Chart 1:

euraud-60-chart1

In this instance we are following the EURAUD on a 60 minute timeframe and looking at it in the light of the context that our larger charts were giving us. In terms of the bigger picture we were in an area of potential support so honed in on this 60 minute timeframe in order to look for evidence of a change of behaviour.

We were watching the resistance provided by the lines of the red fork. Note that there are two lines marked by a series of red circles – we followed as the resistance provided by the lower of these lines turned into support and then again as the same happened along the higher of the two lines. Price was effectively “stepping up” in the line of the fork – a bullish sign as resistance turned in to support. The process continued along the dashed red quartile as shown by the blue circles eventually moving through the highest line of resistance in the red fork.

Given this change of behaviour we looked to see if we could draw a pitchfork to define the new move. Using the distinct A, B and C pivots we looked to see if the new blue fork could be validated by the action along its angles. The first indication that it was working came from the touches along the handle, indicating that the angle of ascent was indeed worth following. Note also the resistance along the puce Sliding Parallel –  remember that it is not the lines of the pitchfork itself that are important, rather it is the angle in which it is drawn.

Price retraced from this anticipated resistance and moved all the way back t the Lower Parallel of the fork. The action at the first red arrow further validates the fork – note how price spiked to support and then reversed. Even though we saw this line violated on the next approach we were still watching to see the effect of the Lower Parallel when price reached it again at the second red arrow. Three solid bars finding support along this line of previous activity have led to a move this morning from 1.4462 to a high so far of 1.4538 – not a huge move but one that could have been taken with a tight low-risk stop.

I will continue to monitor the movement of price within this pitchfork, looking to follow the strengthening and weakening of trend. If price pushes to a higher resistance in the angle of the fork and support steps up as well, then we will be looking for higher prices. If however we find a lowered resistance then it is likely our support will be under pressure and we may expect lower prices in the future.

The Cross Pair Analysis service uses Median Line Analysis to cover a dozen non-US Dollar pairs on a daily basis, looking at context via Weekly and Daily charts and in detail via 240, 60 and, sometimes, 20 minute ones.

I recently hosted a webinar looking at the Cross Pairs – it is available to watch at this link:
http://www.coghlancapital.com/node/8759

If you would like to find out more about our analysis or services please follow this link:
https://www.coghlancapital.com/signup

Tracking the Pair – EURAUD 240 minute

Over the past eighteen months Cross Pair Analysis members have tracked the movement of this pair from a low in August 2012 of 1.16 to a high in January 2014 of just over 1.58. Since then we have followed as price has declined to a recent low of 1.4505.

Median Line Analysis using pitchforks seeks to recognise and define the path of price of a vehicle and to monitor the strengthening and weakening of trend within the lines that we have drawn. It does not always suit traders to use the Daily timeframe so in the Chart I present a recent pitchfork on a 240 minute basis that we are currently using to determine this variance in trend.

euraud-240

The methodology involves using distinct A, B and C pivots and drawing the pitchfork to best determine the all-important path of price. In this case the variant we are using is known as a “Schiff” or “Unmodified Schiff” pitchfork whereby the origin of the fork is moved 50% of the distance from the A pivot to the B pivot in price but not in time. Having drawn the pitchfork we look to see if we can validate it ie if we see price action along the angle of the lines that we have drawn.

In this case we quickly note what is happening in terms of resistance along the Upper Parallel in the area of the green circle. The untested or previously unproven line provides a line of resistance to price which proceeds to fall from about 1.4980 to the third red arrow at just over 1.4550.

Median Line Analysis allows us to predict with great accuracy likely areas of support and resistance and you will note how the third red arrow lies along a green Sliding Parallel emanating from the low at the first red arrow.  Until we see consistent support or resistance along such a line we do not know whether or not it is indeed a Sliding Parallel. However given that we are confident that we have correctly described the path of price – the angle along which the vehicle is moving – it is certainly an area that we would be closely watching as price approached it. The fact that we have had not two but three bounces along this line adds to our confidence in it.

Price rose from this third touch at 1.4550 all the way back to 1.4870 and another line of anticipated resistance, our old friend the Upper Parallel. The first down facing red arrow shows this action very well and how, after a double tap, price then fell away from this resistance once more. Not only that, but we now seem to be establishing a line of resistance slightly lower in the fork – this is shown by the red dotted Sliding Parallel and the series of red down facing arrows.

We need to monitor this vehicle closely as we are potentially seeing a rising of support as well. After the support along the green Sliding Parallel we could argue that we are seeing a stepping up of support as indicated by the last two up facing red arrows. They are potentially showing that we are finding support along the Median Line of the fork. Effectively we are seeing a wedge developing in the pitchfork with rising support and lowering resistance. We will continue to monitor the char looking for strengthening or weakening of trend along the lines that we have drawn to describe the path of price. This pitchfork is particularly relevant because our analysis of the Daily timeframe (not shown here) indicates that we are potentially at an important point in terms of price.

The Cross Pair Analysis service uses Median Line Analysis to cover a dozen non-US Dollar pairs on a daily basis, looking at context via Weekly and Daily charts and in detail via 240, 60 and, sometimes, 20 minute ones.

I recently hosted a webinar looking at the Cross Pairs – it is available to watch at this link:
http://www.coghlancapital.com/node/8759

If you would like to find out more about our analysis or services please follow this link:
https://www.coghlancapital.com/signup

A Check In – EURAUD 60 min

I had a look at this pair in some detail last week and wanted to check back to see how it was progressing. Remember that Median Line Analysis seeks to determine the path of price of a vehicle, defining it by means of a pitchfork and then to track the strengthening and weakening of trend along the angle of the drawn lines.

We last looked at the vehicle in the vicinity of the blue circle in Chart 1. We had followed price as it moved from the three touches at the Lower Parallel all the way to resistance at the Upper Parallel. What was interesting me was the stepping up of support that we were seeing in the line of the pitchfork – from the Lower Parallel to the blue dotted Sliding Parallel marked by the series of red circles. The first three red circles show where this line was resistance and later how it becomes support.

Chart 1:

euraud 60 minutes

From the blue circle price does indeed rise once more to resistance at the Upper Parallel before falling again to our newly defined raised support. Despite the spike down seen in the third red circle we continue to see that the floor of the vehicle has risen in the line of the fork. As on the horizontal, when we see that the floor has risen we can anticipate that the same will happen with the ceiling. Accordingly it is no great surprise when the prior resistance along the Upper Parallel is breached and we see price push higher – in this case to the green circle where resistance is noted along the line of the outer Quartile. Note how just under the Upper Parallel we again have a blue dotted Sliding Parallel where resistance has once more became support.

From this Outer Quartile resistance there has been a strong reversal and we look to the chart to see where and why we have found support. As price fell one of the areas of potential support was along the line of the Lower Quartile. If you note the red arrows, it was a line that had previously acted both as support and resistance therefore it was an area to which we were looking for the same once more. Despite a fall of nearly 200 points from the green circle price did indeed find support along this Quartile and since the double touch at the line it has rebounded over 100 points.

By quickly establishing the path of price and watching the strengthening and weakening of trend along the lines defined by the pitchfork we are able to look for high probability areas of support and resistance in any vehicle on any timeframe.

The Cross Pair Analysis uses Median Line Analysis to cover a dozen non-US Dollar pairs on a daily basis, looking at context via Weekly and Daily charts and in detail via 240, 60 and 20 min ones.

If you would like to find out more about our analysis or services please follow the link:
https://www.coghlancapital.com/signup

I recently hosted a webinar looking at non-dollar forex pairs – it is available to watch at this link:
http://www.coghlancapital.com/node/8018

Textbook Moves – EURAUD 60 min

Median Line Analysis using pitchforks seeks to define and then follow the path of price of a vehicle using the angle of ascent or descent of the lines that we draw as high probability supports and resistances. The Cross Pair Analysis service looks at a dozen non-US Dollar pairs via daily videos and amongst those that have been catching our eye recently is the EURAUD 60 min.

We had been following the decline in this pair for some weeks although since early April we had been alive to the possibility of some “bottoming out” being apparent. Chart 1 shows how we followed price as it found lows in the red fork and then started to “step up” across the fork both in terms of support and resistance. The first green circle shows how on the 16th price found resistance at the red Upper Parallel and reacted away from it. The next day price reacted once more to this line – albeit in a lesser fashion – before breaching the line and finding support along it in the second green circle.

Chart 1:

euraud-chart1

This change of behaviour led me to draw the blue pitchfork to the upside using the distinct A, B and C pivots. It was very early to do so at this point and we needed to establish the validity of the fork ie that it was indeed defining the new path of price that we had discerned. There was at this point some possible resistance along the Upper Quartile and potentially some support developing along the Median Line.

Chart 2 shows how the vehicle moved over the next few days. Price did indeed continue to find support along the Median Line as shown by the red arrows and in fact a narrow channel formed with resistance along a Sliding Parallel again marked with red arrows. We could be reasonably confident that we had indeed found all-important the path of price.

Chart 2:

euraud-chart2

Note how price fell on the 22nd to find support in the last green circle at the Lower Parallel of the blue fork and also significantly once more along the line of the red Upper Parallel. As on the horizontal when prior resistance becomes support that is deemed bullish and this is precisely what happened here. The Lower Parallel of the blue fork continued to act as support before price exploded to the upside from 1.4722 in the purple circle – very obvious here is how close one could have placed a stop in order to benefit from the move.

A rapid rise of 200+ points to expected resistance along the Upper Parallel ensued with price reaching 1.4929 in the second and third purple circles. As price dropped back from this exact touch we note that the fork continues to define the moves of the pair. The last two red arrows show how support is now showing along a Sliding Parallel that was previous resistance and furthermore the red circles indicate that this may be happening once more along the higher line of the upper Quartile.

Bear in mind that this is a 60 minute chart and that the pair can be very volatile – it is therefore essential to continually monitor the action of price along the angle of the pitchfork in order to determine whether trend is strengthening or weakening. We also look at the pair via different timeframes and take these other charts into account in our analysis.

I hope that I have been able to explain by showing these very precise moves to demonstrate how Median Line Analysis can help the trader in predicting with great accuracy likely areas of support and resistance and allowing him or her to trade with high probability of success whilst using tight stops.

The Cross Pair Analysis uses Median Line Analysis to cover a dozen non-US Dollar pairs on a daily basis, looking at context via Weekly and Daily charts and in detail via 240, 60 and 20 min ones.

If you would like to find out more about our analysis or services please follow the link:
https://www.coghlancapital.com/signup

I recently hosted a webinar looking at non-dollar forex pairs – it is available to watch at this link:
http://www.coghlancapital.com/node/8018