Currency Futures Trading: A Technical Preview Monday 2/15/10
Posted by: Richard Estrada // Category: Currency Futures Trading
After a long weekend in the U.S., Currency Traders prepare for another week in the currency futures market. Currency Traders left off Friday with some markets consolidating, other currency markets pushing higher and one market trying to save itself from the abyss. What is in store for currency futures trading this week? Once again who knowS, but one thing is probable it won’t be for the faint of heart.
The weekly chart of the British Pound Futures (see chart below) clearly illustrates two technical points. The first being a break below a bear flag technical formation (outlined by black trendlines) and a break below a pivotal cycle low (1.5702). The 4-week moving average (red – 1.5736) may turn out to be a good gauge of technical momentum this week.
The weekly chart of the Canadian Dollar Futures (see chart below) shows not only a break below the 13-week moving average (blue – .9465 last week), which has been a strong area of technical support, but also a complete reversal and run back through the same moving average. Does this volatility mean the Canadian Dollar might be losing some technical upside momentum, or was the initial down move a bear trap?
The weekly chart of the Euro Currency Futures (see chart below) clearly shows a market in the mist of an aggressive sell-off. You can see once currency traders broke through the cycle low of 1.4215, then this market was basically in a free-fall. The question is where will this market find technical support, will it be the 61.8% Fibonacci retracment number, or will it be on news out of the Euro Zone in regard to the debt crisis that stabilizes this market?
The weekly chart of the Japanese Yen Futures (see chart below) shows a market at a crossroads. You can see that several weeks ago the bulls found technical support at the 52-week moving average (green 1.0679 then), from which they were able to rally from, but does this rally have any legs? Or does this rally look more like a bear flag formation, which is a pause in a prevailing downward trend?
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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: Currency Futures Trading, day trading futues