by Johan Kriek (jkriek@fxinstructor.com)

Key Notes:

- Dow plunges below 7500 last week, risk aversion still rife

- Talks over Citi Group bailout makes a equity market rebound possible

Today’s Events:

- EuroZone Industrial orders @ 09:00GMT

- Germany Ifo business climate @ 09:00GMT

- US Existing home sales @ 15:00GMT

Probability Studies:

We have a new triangular formation on the EUR which means if it is violated to the upside and price moves above 1.2700 the EUR will be situated in a definite bullish probability. A break of 1.2415 to the downside will confirm the bearish probability. If you are patient and wait for the break then your patience will most probably be rewarded

Bullish probability but still no trade zone. As long as the 60minute trend remains bullish the bullish probability will remain intact. A break of 1.2080 will plunge the CHF in a bearish probability. On the other hand a bullish 1 hour stochastic cross will present me with a bullish trading condition

Bearish trading condition. If market rhythm continues to trend South the 1 hour stoch will continue to open to the downside. On the other hand, consolidation from a market rhythm perspective might force a bullish stoch cross with a no trade zone to go with it..

The GBP is still situated in a bearish probability but if the 1.5000 resistance is taken out (bearish 60minute trend resistance line) then we will have a sudden bullish trading condition. Watch this space… price can bounce here. If not, then we’re bullish

I hope you have a great start to your week!

Johan Kriek