EUR/GBP - Potential Short Day TradeHi all..
Price on HTF is currently Bullish to make sure to use risk management here. This is a pullback trade hunter into HTF Demand zones.
This LTF Trade Consists of a internal protected High for price to return back into a the discount zone. We can see nice slow price action heading slightly bullish hoping before we see a nice drop.
Entry is set at two positions:
First being a simple Demand zone
Second being a Mitigation Block just under a FVG telling me price wants to hunt that Imbalance
Good Luck if you decide to Follow
Moving Averages
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$SPY January 28, 2025AMEX:SPY January 28, 2025
15 Minutes
The divergence paid off again.
Now we again wait for moving averages 9 and 21 to go above 50,100 and 200 to initiate any longs.
For the fall 608.15 to 594.64 61.8% retracement is around 602-603 levels.
A good level to short SL 605.5.
I expect sideways today.
USD/CHF | Bearish Season IncomingHigher timeframes (3-Day+) are at a nice resistance zone to see short plays only as we head into the next season
We got a ~600 pip swing but first I'd like to see maybe one more long position back to the main resistance zone for a high sell entry up top and then scaling in as price falls after more confirmation and price development
Trend Reader is looking nice too as its in the overbought zone signaling a bearish play to come with clear divergence
The blue EMA at around 150-Days also acts as good dynamic Support/Resistance to help confirm that flipside once price looks to break below with a rejected pullback.
Where to catch the falling knife?So it's dropped a fair bit since I started writing this post, but needless to say, it would be best to wait and see something technical before a reasonable buy on a pull back could be justified. Looking at the weekly time frame, I'd expect a bounce from about the 115 level, so any bounce could then be judged on its own merits, if it's technical and showing signs of resuming back to the upside, then better to buy on a pull back from there (similar to the GBP chart), in what would be a lower time frame wave 2, than when it could just as easily keep dropping.
Watching Market for this week. - US30Observations:
Price and Bollinger Bands:
The US30 is trading near the upper Bollinger Band, which often signals potential resistance. It may indicate an overbought condition in the short term.
RSI:
The RSI is at 69.70, nearing overbought levels (70+). This suggests the potential for a reversal or a pullback.
MACD:
The MACD is above the signal line, showing bullish momentum, but the histogram seems to be flattening, which could indicate a weakening trend.
Decision Points:
Buy:
Enter a buy position if the price breaks above 44,570 (upper Bollinger Band) with strong volume, confirming bullish momentum.
Sell:
Consider selling if the price rejects the resistance around 44,570 or if the RSI crosses back below 70, signaling a reversal.
Recommendation:
Short-Term Outlook: Watch closely for a rejection or confirmation at the upper Bollinger Band. Based on current indicators, a slight pullback seems more likely.
Place stop-loss orders appropriately to manage risk, regardless of your choice.
Suggested Entry and Exit Levels
Sell Setup:
Entry Point (Short Sell):
If the price rejects 44,570 (upper Bollinger Band) or shows a bearish candle pattern near this resistance.
Take Profit Levels:
Target 1: 44,000 (midpoint of the Bollinger Bands).
Target 2: 43,800 (lower Bollinger Band).
Stop Loss:
Place the stop-loss slightly above 44,600 to avoid getting stopped out by minor volatility above resistance.
Buy Setup:
Entry Point (Buy):
Enter on a breakout above 44,570, with a confirmation candle closing above it (e.g., a strong bullish candle).
Take Profit Levels:
Target 1: 44,700 (short-term resistance based on the next round number).
Target 2: 45,000 (psychological level and likely resistance).
Stop Loss:
Place the stop-loss below 44,400, slightly under recent support, to limit risk.
Additional Risk Management Tips:
Position Size: Adjust based on your risk tolerance (e.g., no more than 1-2% of your account balance per trade).
Volume Confirmation: Use higher volume to confirm breakouts or rejections.
Follow for more ideas.
Darden May Have Broken OutDarden Restaurants jumped to new highs in December, and some traders may look for the move to continue this year.
The first pattern on today’s chart is the March 2024 high of $176.84. DRI remained below that level through early last month. The stock rallied through it after earnings and revenue beat estimates on December 19. Prices have remained above the old peak since, potentially confirming the breakout.
Second, the lower lows between March and July, followed by a series of higher lows, may be viewed as a rounded bottom.
Next, the 50-day simple moving average (SMA) crossed above the 100-day SMA in September and above the 200-day SMA in October. The 100-day surpassed the 200-day SMA in late November. (See the yellow arrows.) That arrangement, with faster SMAs above longer SMAs, may reflect a longer-term uptrend.
Finally, the 8-day exponential moving average (EMA) has remained above the 21-day EMA. That may reflect a shorter-term uptrend.
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EURUSD and return above EMA50EURUSD has stabilized on the bullish side after returning above the EMA 50 moving average. This brought the pair back above 1.04000, and we are closer to the resistance zone at around 1.04500. If we see a break above, we could move back above 1.05500. Failure of EURUSD to hold above 1.04500 will trigger another pullback down towards the EMA 50.
what is the most effective indicator?There isn’t a single "most effective" trading indicator that works for everyone, as effectiveness depends on your trading style, strategy, and the market conditions. However, some indicators are considered more versatile or reliable when used correctly. Here's a breakdown to help you choose:
Most Effective for Trends:
Moving Averages (EMA or SMA):
Simple and effective for identifying trends.
Works well in trending markets but less reliable in sideways or choppy markets.
Pro Tip: Combine short-term and long-term moving averages for crossovers.
Ichimoku Cloud:
A comprehensive indicator that provides trend direction, support/resistance, and momentum.
Effective but requires practice to interpret correctly.
Most Effective for Overbought/Oversold Levels:
Relative Strength Index (RSI):
One of the most popular and effective indicators for spotting overbought or oversold conditions.
Works well in both trending and range-bound markets when combined with other tools.
Stochastic Oscillator:
Similar to RSI but includes %K and %D lines for crossovers.
Effective for momentum confirmation.
Most Effective for Volatility:
Bollinger Bands:
Great for identifying periods of high or low volatility and potential breakout zones.
Useful for sideways (range-bound) markets and trend reversals.
Average True Range (ATR):
Excellent for setting stop-loss levels and identifying market volatility trends.
Works well in conjunction with trend indicators.
Most Effective for Momentum:
Moving Average Convergence Divergence (MACD):
Ideal for spotting trend reversals and momentum shifts.
Effective when used with a confirmation indicator like RSI.
Parabolic SAR:
Simple for identifying trend direction and potential exit points.
Works best in trending markets.
Combination for Higher Effectiveness:
Trend + Momentum: Combine EMA with MACD to identify trends and entry/exit points.
Overbought/Oversold + Volume: Use RSI with Volume Indicators (e.g., OBV) to confirm breakouts or reversals.
Volatility + Trend: Use Bollinger Bands with Ichimoku Cloud to spot breakout opportunities with clear trend guidance.