Big Bad Fox – Page 2 – Forex, Futures and Cryptocurrency Trading

AUDUSD High Time Frame Analysis

12-Month

Starting with the 12-month time frame we can observe a leg up from 2001 to 2011 where price went from the lows of 0.47760 to the highs of 1.10802.

Since making our highs in 2011 momentum has changed and we have dropped to test 0.68910. In 2017 and 2018 we retraced to test 0.80656 before continuing our bearish trend.

The more likely progression is to now break this level and drop lower to 0.57260. Alternatively if we remain at this level and accumulate we can rally to test 0.93874. Lower time frames will provide more precision.

3-Month

On the 3-month time frame we can split the single up leg into two seperate legs. We can also add a more precise level at 0.67480 whose origin is the swing-high that made our all time low. We can see this level being respected by our last couple of candles and slowing our bearish momentum.

1-Month

Again more sub-dividing of legs and zooming into current price action.

Further detail can be observed around the last few candles, in particular how we respect 0.68910 and 0.67480. There are no obvious reversal patterns or signs of slowing bearish momentum, just a minor retracement due to levels being hit. On the monthly chart I expect price action to eventually break these current levels and head towards 0.57260.

Zooming in further we can identify our most recent monthly leg down marked in yellow, along with the swing-low of the high candle at 0.70167.

We can look for shorts around this level on lower time frames.

1-Week

A double bottom can be recognised as we respect 0.67480. This accumulation will target the first support lost which brought us down to the low. On the weekly chart this can be approximated to 0.69962 (which fits in nicely with our monthly level of 0.70167) followed by 0.71914 if we can reach that high.

The weekly chart also shows the origin of the level we are currently respecting of 0.69105. A swing-low to our high of 0.70821.

If price action moves above 0.70821 it is the first invalidation of our down-trend. This is therefore an appropriate level for a stop-loss.

1-Day

We now have lots of levels plotted and without following the above analysis things can get confusing. We must focus only on what is next. On the daily chart we can add another more precise level at 0.70374 whose origin is the low of the candle that made the high. This is the daily target following the accumulation at 0.67480.

A couple of things to note, one is the size of our accumulation pattern. This huge double bottom, together with the significance of the higher time frame level which it respected, suggests we may eventually break higher than 0.70821. This is important for setting our expectations when entering trades.

The second thing to note is how higher time frame levels are lining up with lower time frame levels from 0.69962 to 0.70374 area. This suggests we should get a nice reaction here. The invalidation level is close by so I will be looking to enter short trades.

For the moment we are looking bullish on the daily. I expect a retracement at our current level before ultimately progressing towards the 0.7 area.

Lower time frames can provide more precision and clues.

EURUSD Daily Looking Like More Upside

After hitting our significant higher time frame level and forming an ugly double bottom at 1.09058, we have rallied up to 1.11813 (purple level).

Next week I expect price to eventually break this purple level, as it is our second attempt and there is still bullish momentum present. A pop to the 1.12155 area should present some shorting opportunities in the intra-day time frames.

EURUSD High Time Frame Analysis

12-Month

Let’s start this blog with some EURUSD analysis.

The 12-month time frame shows we are currently retracing the leg from Jan-2000 to Jan-2008.

From the highs of 2008 we dropped to 1.04151 support which originates from the high of the candle which made our Jan-2000 low.

We have since rallied up to 1.23295. The low of the candle which made our Jan-2008 high.

Last year we rejected this level and now we are progressing down back to 1.04151. It will be our second touch at this level so we should break it if bearish momentum continues.

We can therefore carry a bearish bias into our lower time frames, assuming we can determine 1.23295 has indeed been rejected.

6-Month

Following from the 12-month time frame bearish bias, I now check the 6-month time frame. As we move from high time frames to low time frames our precision increases, but we must remember what the higher time frame is trying to achieve as this represents more volume and therefore a stronger trend.

The first thing to note is we can now see 2 seperate up legs. The high of the low candle on the second leg is the origin of 1.25891 – the level that we tested in Jan 2018.

Have we finished testing the 1.23295-1.25891 zone, or are we likely to return here before dropping lower? Currently we have strong bearish momentum on this time frame, so until we see signs of accumulation or slowing of this momentum, we must go with the bearish trend.

3-Month

Zooming in a little and focusing on more recent price action we can add another leg and two more significant levels.

1.09058 is the high of the low candle in the 2017-2018 up leg. 1.19155 is the opposite – the low of the high candle from the same leg. We can clearly see 1.09058 has been respected by the July 2019 candle.

I can also observe an ugly double bottom / accumulation forming between Jan 2015 – Jan 2017 where we had a trend reversal as 1.04151 was being respected.

Note how the Jan 2015 – Jan 2017 test was much more prolonged than the test at 1.23295. The reason for this is because we were reversing a higher time frame trend into a retracement, as opposed to bringing the retracement momentum back to match the higher time frame. More accumulation and more counter momentum was required to offset all those bears.

1-Month

1.08123 is a new significant level that we have not yet tested. We can also break the up leg from 2017-2018 into two seperate legs.

On this time frame, without a significant reversal pattern or accumulation, I am still bearish. The October 2019 candle bounced as we hit the higher time frame level on first touch. I am now looking for a reversal on this retracement to take us back down to 1.09058 and probably lower to 1.08123.

EURUSD 1-month time frame additional legs and invalidation levels

Here I have plotted the yellow legs on the way down and marked two swing-lows of these legs. In order for trend to continue down we must not break the two red invalidation levels. 1.15698 being of most significance, but 1.14122 also being important.

There is a very high probability that we will get a reaction when we hit 1.12155 and 1.13010. These levels would provide a great shorting opportunity, but we must look at lower time frames to get a more precise entry around these areas.

1-Week

As we reduce the time frame further, more legs become visible. We must not however, forget the higher time frame legs as these will carry more weight and produce bigger reactions.

The weeky chart shows the double bottom accumulation pattern from 26th Aug – 30th September that resulted in the pop as we hit the 1.09058 level. We can also observe early signs of distribution and slowing of bullish momentum in our last candle.

The target of the double bottom accumulation is the first significant support lost on the leg down: 1.13441. We should also respect the major levels of 1.12155 and 1.13010. If price action moves above 1.14122 our intermediate down trend is invalidated.

How high will we retrace up to 1.14122? Lower time frames can give us clues and provide more precision.

EURUSD 1-week time frame intermediate level

The purple level marked above shows the origin of 1.11813 and the reason for our pullback last week.