This is a video summary of the Live Forex Trading Room session on August 28, 2007.

Today’s Summary:

A somewhat slow day today, though a few significant moves to discuss as well.

On the GBP/USD’s daily perspective, a trendline connecting the previous daily high has been breached on the downside. Eventually it will form some sort of resistance on the way back. The level of the 2.0096 support has come into play as a resistance level. As this view gets crystalized, we are looking at the market suspiciously, because after this rebound and entrance of the upper trendline and its respective lower resistance channel, we anticipated some more upmove. However, with these lows getting into play, we are anticipating some more downmoves to test the support line which is the lowermost support boundary of the uptrend channel.

From a longer term perspective, you find that this trendline has been tested a few times before, and each time it has prompted a large upmove. After the most recent test of this trendline, the move has not taken place yet. We are anticipating a Long position around the 2.0003 level, as this is the 38.2 level of the full Fibonacci retracement, and the trendline connecting the physical lows of that upmove that is breaking the downleg currently taking place. If the price reaches the 2.0003 level trendline, we have the potential for a very good trade for around 100 or 200 pips target with only 30 pips of loss.

EUR/USD on the weekly charts indicate a similar situation to the GBP/USD. A nice upmove that was temporarily breached to the lower side, however we cannot call this a breach, as the price has just tested the trendline level, and closed right above. The next weekly candle opened below, with a good strong close right above. Going down to the daily chart, the 100% previous high fib level has given some resistance, causing prices to go down, and we have another fib fan that is giving resistance. All this would eventually give us some pullback, then a resumption of the upwards move.

GBP/JPY is being traded exclusively on the 5 min chart today. The wild moves that this pair exhibits can qickly wipe out an account.  We are trading on the shorter timeframes, and obtaining longer term views from the daily and 4 hour charts, but when looking for entries, we look at 5 min exclusively, looking at divergence setups where possible. Regardless of the fact that the market was quiet today, we have been able to successfully trade this pair on the shorter timeframe.

USD/CAD being traded as usual on the 4 hour and daily timeframes. Looking at the 4 hour charts, we have some upmove that has been breached to the downside, with the prices subscribing to the downleg since 3 days ago. By yesterday, the prices found support at the 1.0473 level, and rallied higher, as anticipated in the Live Trading Room session of 2 days ago. We need to see where the price will go next, but a rejection at the fib level at 1.0640 would trigger a Short position, and target again the support at 1.0473.

Enjoy the video and see you next time at our Live Forex Trading Room!

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