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Support Resistance

Weekly Review of GOLD (XAUUSD) 08 AUG 2013

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Here is the weekly review of spot GOLD XAUUSD levels. You can last week’s chart review in this post.

GOLD reacted at the resistance level and also 50% retracement of D1 down leg. 1347.57 is now the level to watch for any false break should price retrace back to this high. Overall, GOLD is contained in the Daily down channel. The key levels to watch now are 1297.55 for resistance and 1268.40/1272.22 for support.

Here is the Daily Chart of spot GOLD

GOLD Daily Chart
GOLD Daily Chart

In 4-Hour time frame,  I am watching closely is the potential break up of the H4 down channel. Refer to the 4-hour chart below, a break of this channel, and 1297.55 might bring us back to 1347.57 as mentioned before. On the hand, a break of support level 1268.40/1272.22, I will be looking at potential short setup at the pull back.

GOLD 4-Hour Chart
GOLD 4-Hour Chart

That’s all for this post.

From the desk of TraderGav.com

Some levels trading lesson from USDJPY

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I thought I will write a quick follow up of the USDJPY development. Well, in the bigger picture, price is still trading within the channel as shown in my previous post Here and Here. However, there are some developments in Hourly time frame which I can use to show how I approach the levels. This is definitely not a post to show off how many hundreds of micro, nano pips that I have gained nor to whine about missing/losing trades.

Anyway, I have annotate the chart with my comments. Hopefully it helps some of my 12 readers.

The key notes here are:

  • The importance of observing on-going price development A valid level is not taken due to risk/reward ratio has been compromised. This happens when a price does not continue selling (or buying) as expected, instead it creates a base with forming new support and resistance levels.
  • When a level is not the strongest according to our plan, always look for more confluence factors.

Here is the hourly chart of USDJPY (click to magnify the chart)

USDJPY 1-Hour chart 06 August 2013
USDJPY 1-Hour chart 06 August 2013

Leave me a comment for any question you might have.

From the desk of TraderGav.com

Trading setup: Immediate retest of broken support and resistance level

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Very often, on twitter or forums, I see people posting some simple trading setups, and give them some odd names, then call it their inventions. Laughable indeed. Anyway, kudos to them for providing some amusements.

One of the most commonly seen setup is Immediate retest of broken support/resistance level. Well, regardless of the names given by “traders”, let’s have a look at it a little b it closer.

If I really wanna trade the immediate retest, there are three conditions I wanna see before establishing a position:

Strong level

Immediate retest of a level works, when it is against a strong level. It could be a horizontal support and resistance level, or diagonal trend line. A strong support or resistance level is the one that was formed by multiple touches in the inverse direction before it is broken. For example, a strong support is a level that was formed by a broken resistance level where there were multiple resistance points, in other words, multiple swing highs. Vice versa  for strong resistance level.

So, for the first condition, I want to see a break of level which was constituted by at least 3 swing points (or 2 with other confluence factors)

Strong breakout

Secondly, I want to see a strong break of the level. A slow grinding movement is avoided. Often times, it might turn out to be a false breakout. So, a STRONG breakout bar is what I would like to see.

Continuation pattern

A continuation pattern can be as simple as a small consolidation price cluster following a strong breakout. The basic idea is to have Breakout -> Consolidation ->Breakout scenario.

Here are some charts to demonstrate this setup.

AUDUSD immediate retest explain
AUDUSD immediate retest explain (click for bigger chart)
EURUSD Immediate retest explain
EURUSD Immediate retest explain (click for bigger chart)

So, here is the simple support resistance setup. Of course, this is not a complete trading strategy. Just some tips for you to consider before taking an immediate retest setup. Err… Shall I also name it as Butt Kiss Setup!

 

From the desk of TraderGav.com

Weekly Review of GOLD (XAUUSD) 30 JUL 2013

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GOLD XAUUSD Daily chart
GOLD XAUUSD Daily chart

In my previous post, we have identified the potential resistance zone around 1335. We are right there now. I would like to see a turn at this area, and projected target is at 1000 should the selling resumes.
But, it is not as simple as it sounds. There are road blocks in front of us.
let’s zoom into H4. I expect to see some good support around 1300. A break of H4 uptrend line (golden line in the chart) and 1300 support should provide some ‘feel good’ factors for bears to initial shorts again.
First target for the short side is the last swing low around 1180 , and 2nd is the completion of ABCD formation at 1000. Maybe the targets are over ambitious, but who knows? That’s the plan for now.

GOLD XAUUSD 4-Hour chart
GOLD XAUUSD 4-Hour chart

On the other hand, in case failed to ignite the selling engine, next resistance level is seen at area of 1527. Have a look at the weekly chart below. The ABCD projection is definitely hypothetical and extremely ambitious. We will review the price action later.

Gold XAUUSD Weekly chart
Gold XAUUSD Weekly chart

That’s all for now. What do you think? Let me message at the comment section.

From the desk of TraderGav.com

Waiting for the nobrainer trades AUDUSD USDJPY

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AUDUSD

Aussie remains trapped within the trading range. You can trade your range play strategies, I prefer to wait for nobrainer setups. 0.93 is still the key level to watch for any bullish movement. 0.9030 is the immediate support area to watch. A break of these levels will interest me.

AUDUSD 4-hour chart
AUDUSD 4-hour chart

For short term intraday trading, there are some levels to watch within the range. 0.9230 is the support level I watching. As a personal preference, I like to trade the reversed level, in other words, I prefer the break of support and initiate a short position at the pull back.
The next immediate support is seen at 0.9170 ish, and 0.9110.

Here is the hourly chart of AUDUSD with key levels marked.

AUDUSD 1-Hour chart
AUDUSD 1-Hour chart
USDJPY

The false break at the 98.25 level as mentioned in my previous post did not happen. USDJPY did not manage to close above the level. Instead we are likely to head to 97 now.

Here is the H4 chart of USDJPY with key levels marked.

USDJPY 4-hour chart
USDJPY 4-hour chart

And here is the H1 chart of USDJPY

USDJPY 1-hour chart
USDJPY 1-hour chart

That’s all for now. More later. Remember, it is NFP week, so keep trading if you want, and be cautious.