G’day Surfers – did you enjoy the ride?

Yesterday’s Report

EURO launched itself yesterday and it took us with it for a very nice ride on EUR/JPY, to the tune of 70 pips in total. The Swing & Relax trade was a beauty and the exit, very prudent. Our 2nd Take profit level became an optimistic target as Price Action struggled to get the better of Weekly Resistance. Our decision to Bank was vindicated by the retreat of Price Action, shortly thereafter. EUR/USD performed in very similar fashion, bolstered (apparently) by more speculation surrounding ECB intent to act further on the easing of Spanish & Italian borrowing costs. The Surfing The Pips Critical Level of 1.2482 was immediately in The Bulls sights and they tested it perfectly.

Technical Analysis

The inverted Head & Shoulders on EUR/USD D1/H4 flexed its muscles yesterday, breaking the congestion to the High side, showing scant regard for our untested Daily Pivot. Price Action has failed to pullback to the new Daily Pivot as yet today as well. With that to consider, it’s also noteworthy that Daily has snuck towards the Boundary of Comfort away from Weekly. These conditions suggest pullback is necessary and it will be difficult to go long without it. With the formidable resistance of our long term trend line and the long suffering 1.23335 level stunned in Price Action’s wake, an upside continuation is looking far more likely however. Sentiment is therefore long but would like Price Action to re-acquaint itself with Daily Pivot before hitting the afterburners again.

The Day Ahead

Well my theory of attacking from the opposite direction yesterday proved fruitless but if I know one thing about trading a strategy – it’s don’t change it after a single misread. I will therefore look for Price Action to head South before North. If I can find an entry to accommodate that, it’s Plan A. A reliable Hotspot is difficult to find however, due to the Skyrocket of yesterday. Our Intraday Trend Line is the focus for now. let’s see if it’s any good???

Have a great day.