Currency Futures Trading A Day Trader’s Review & Outlook 2/4/10
Posted by: Richard Estrada // Category: Currency Futures Trading
I always talk about currency futures trading not being for the faint of heart, or garden-variety-investor and today was a good example of just why I make that statement. Currency Day Traders watched several markets go through projected areas of technical support like tanks through soldiers on foot, while the Japanese Yen exploded to the upside. So, what questions area currency traders asking themselves tonight?
Well let’s start with the March 2010 British Pound Futures contract (see chart below). You can see that that once the market broke back below the 5-day moving average (red – 1.5859) the bears really put the pedal to the metal. I would like to point out that the British Pound also broke through a bear flag technical formation on the weekly chart and through a pivotal cycle low (1.5702) on the same chart.
So, what’s the next stop on the short train? Maybe the short-traing is on it’s final leg and looking to turnaround. I guess that depends on if there are enough willing to climb aboard.
The daily chart of the March 2010 Canadian Dollar Futures contract (see chart below) also sold off today. This market looked like a skydiver falling from about 2500 feet.
You can see just like the British Pound futures market, once the bears broke back through the 5-day moving average (red – .9383) the Canadian Dollar collapsed, though the Canadian Dollar is still well above the last cycle low (.9217). Can the bulls hold the Canadian Dollar above this level, or is this commodity based currency going to continue to get slammed Friday?
The daily chart of the March 2010 Euro Currency Futures contract (see chart below) shows a market that is showing no mercy for any traders buying and holding. You will also notice that the Euro Currency went through the 2.5% weekly volatility range (1.3683) in the early hours of the night market, once again going through a projected area of technical support like a runnaway train coming down a mountain.
The question for currency futures traders trading Euro Currency futures tonight is a simple one. Should currency day traders try and jump on this short-train or wait till next week to try and get into this market?
The March 2010 Japanese Yen Futures contract (see daily chart below) clearly illustrates a strong move from the 25-day moving average (blue – 1.1002) in today’s session. I have been asking currency futures traders a simple question all this week and today I think today we got our answer. The answer wat the current pause was a pause in a prevailing upward trend and not a pause in a downward trend. So what now? Can the bulls continue to push this market higher, or will we see the bears step in looking for a short-term correction?
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There is significant risk of financial loss in trading futures and trading futures is not suitable for everyone. You should carefully consider whether such an investment is right for you in light of your financial condition.
Tags: British Pound futures, CAD USD Futures, Canadian Dollar futures, Currency Futures Trading, currency market, currency traders, day traders, day trading futures, Euro Currency futures, Japanese Yen futures, live trading room
