Jim Wyckoff's FOREX Top Trading Opportunities--Dec. 9, 2005
Buy Australian Dollar-U.S. Dollar on more strength. On a move above .7545, buy the Australian Dollar-U.S. Dollar pair. Place a protective sell stop at .7480. Upside price objective is .7700, or above. Use a trailing protective sell stop if profits begin to accrue. See on the daily bar chart that "Aussie-U.S. is in an uptrend from the November low. Prices just recently negated a downtrend line drawn off the September and October highs. See also that the shorter-term moving averages I follow (9- and 18-day) are in a bullish mode as the 9-day is above the 18-day moving average. Finally, the move this week in the Continuous Commodity Index (CCI) to a 25-plus year high is also bullish for Aussie-U.S., as the Australian dollar is considered a "commodity currency" due to its heavily commodity-export weighted economy.

Buy U.S. Dollar-Japanese Yen on more strength. On a move above 121.41, buy the U.S. Dollar-Japanese Yen pair. Place a protective sell stop at 119.40. Upside price objective is 125.00, or above. Use a trailing protective sell stop if profits begin to accrue. See on the daily bar chart that "Dollar-Yen" is in a solid uptrend. Prices just recently hit a fresh 2.5-year high. See also that the shorter-term moving averages I follow (9- and 18-day) are in a bullish mode as the 9-day is above the 18-day moving average. Finally, see at the bottom of the chart that the Directional Movement Index (DMI) has an ADX line reading of 38.38. Any ADX line reading over 30.00 does suggest that a strong trend is in place in a market. Dollar-Yen bulls are in technical command and looking for more on the upside in the near term.

Sell Euro Currency-U.S. Dollar on more weakness. On a move below 1.1638, sell the Euro Currency-U.S. dollar pair. Place a protective buy stop at 1.1730. Downside price objective is 1.1400, or below. Use a trailing protective buy stop if profits begin to accrue. See on the daily bar chart that "Euro-Dollar" is in a solid price downtrend from the September high. If prices can punch below the recent four-week-old sideways congestion area on the daily chart, then that would be considered a bearish downside "breakout" and the bears would gain additional downside power to produce another solid leg down in Euro-Dollar.

 

Disclaimer:   These are hypothetical trading opportunities. There is a high risk of financial loss in FOREX trading. FOREX trading is neither easy nor an easy way to make money. It takes hard work to have success. Please use sound money management when trading FOREX. Past performance is not necessarily indicative of future results. Nothing in this newsletter is intended to be a trading recommendation for you to buy or sell FOREX, futures or options. All information has been obtained from sources believed to be reliable, but accuracy is not guaranteed. Readers are solely responsible for how they use this information.