Transcript of Video
Hello everyone, this is today’s video analysis for November 8, 2018. Today we’re looking at the Euro versus the US Dollar [EURUSD] for today’s trade analysis.
A couple of things to observe here on the daily timeframe. First, two different trends I want to talk about. The blue trend line, which is the longer-term trend. We see we’re well away from that. Well underneath that blue trend line. It’s been a downtrend for quite a long time. Secondly, the black trend line. A little bit of a shorter leg of that trend. At least the last leg of the downtrend as it went from here into the 1.1800 or so level. Just above 1.1800, down to 1.1300 at the very bottom of the chart.
So, we had the two trends that we are observing here. Both downtrends. Interesting enough today, we are pushing just above the black trend line. I’ll zoom in here in a moment. Secondly, other than the trends I want to point, is the double bottom that we’ve created here right around that 1.1300-level. The green zone. Very bottom of the chart. You could see it came down here several weeks ago into August and touched into that green zone, 1.1300, and bounced up significantly to 1.1800.
Then we came back down. Challenged the 1.1300-level again. Marked repelled it and sent it back higher. So, we’re in the midst of what is a pullback, a correction, retracement, or potentially even a trend change if the market continues to pressure higher from this 1.1400-level above the black trend line.
Let’s go ahead and zoom it in now that we’ve seen all that wider-angle view stuff from the daily timeframe. And let’s zoom it in and now you could see what I mean by sitting above the black trend line, coming down here, and today we’re just above it. Yesterday, quite a dramatic candle, wasn’t it? We saw a big bullish push all the way above the 1.1480-level, the pink-shaded area, and then suddenly came back down, but sitting still above the blue zone, 1.1405, 1.1380.
The fact that we’re just sitting above that blue zone gives me some hope and confidence that we will see it stay above the blue zone. So, as long as it’s above there, I really don’t have any real reason or confidence to go short here on the EURUSD. The only real reason I would have confidence to go short is that it breaks back under that blue-shaded area, 1.1380. So, above it, we have more confidence above the black trend line, above the blue zone, and support for the EURUSD.
Testing back to the pink zone is the possibility that we’re looking for, and even beyond that, we could even see it back up here towards the orange or even the yellow zone, which of course would come in contact with the longer-term blue trend line that we see way up here at the top of the chart.
Let’s just take a couple of fibs just for kicks here. Fibonacci from the high of the black trend line, down to our current low. We’re sitting right at the .236. 1.1423. .382 fib. Look at that. Yesterday’s high right into the 1.1498-level. 50 percent top of the orange zone. Guess what. .618 sits all the way up here at 1.1619, which is just the bottom of our yellow zone and the blue trend line.
So, I do think there is room to go. If it can stay above this blue zone, there’s room to go. Even as a retracement or correction of the blue or the black trend line, we could still see it go higher. So, that’s why I’m focused on buying above the blue zone even though long-term we have been in a downtrend. The risk here is pretty easy. We just don’t want it to get back underneath that blue-shaded area. So, if you decide to go long above the blue zone, stop loss will be underneath it. Somewhere underneath it to minimize the impact if it turns back around and goes back down.
So, stop losses underneath 1.1380, the blue zone. Buying above 1.1400, 1.1405, the blue zone is the main focus. One more fib. I did the longer one. Let’s take one more fib from the mid-low right here in the middle of the black trend line, where it touches the black trend line on that little rally. Let’s go from there, down to the bottom. And in doing this, we find the .382 Fibonacci retracement level right on top of the .236 at current market value. Isn’t that interesting? .382 of the shorter range sitting right on top of the .236 right smack here in the middle, between the blue and the pink-shaded area.
50 percent of that range sits inside the pink zone. .618 of that range sits on top of the 50 percent of the .382 of the longer-term range right here spike high yesterday. And then we have some overlap here at the orange zone and the yellow zone. By the way, look at that. Yellow zone. Orange zone. Just above the pink zone. Just above the blue zone. Fibonacci overlapping together with all of those levels.
So, interesting enough. Again, I think buying above the blue zone main focus today. Let’s take it real quick down to the four-hour timeframe and you could still see it sitting above this blue zone. So, anywhere between current market value. The blue zone. I’m looking for the long shot. Looking for it to continue to pressure higher into the pink zone or even the orange zone, or maybe even the yellow zone for the day today on the EURUSD.
From Forex Traders Daily, this has been your daily analysis with Ross. If you would like to get Ross’ analysis on all the currency pairs he’s watching and all the trades he takes today, join him in his live Trade Room by clicking on the link below. Please leave any comments you have about today’s video in the comment section below.