FOREXYARD: Forex News Blog | |
- Identifying the Trend of Silver
- Identifying the Long Term Trend of Gold
- EUR Gains as Irish Debt Concerns Diminish
- Silver Hits near $27.75 Level
| Identifying the Trend of Silver Posted: 22 Nov 2010 11:10 AM PST
To find the trend of silver one just has to look up. When a trader goes to the silver charts to identify the present direction of the trend the direction should be obvious from first glance. Under heavy volatility, the commodity has reached a new all-time high at price of $29.34. Looking at the daily chart, the current uptrend is identified by the rising trend line beginning at the end of August. The trend line rises with the price making 5 points of contact with the trend line. After each point of contact the price then bounced higher. Any trend line with more than 5 contact points is a significant trend line. Many traders use the following strategy; when the price moves back towards a significant trend line a new position is initiated in line with the long term direction of the trend. The trend line can also serve as a reference point to place a protective stop. A stop can be set underneath the trend line should the price breach below the trend line and reverse into a downtrend.
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| Identifying the Long Term Trend of Gold Posted: 22 Nov 2010 07:05 AM PST
Despite the long term charts clearly showing a rising trend, traders continue to short the commodity, going against an age old rule of trading with the trend. When attempting to determine the long term trend and in such the direction of a trade, traders should be looking not to the short term charts (hourly, daily) but to the long term charts (monthly and weekly). This allows a trader to view the long range movements of the commodity and not just the short term day to day fluctuations. Using a long term time frame, a trader can identify the trend of the commodity and in such go by the significantly overused yet rarely practiced phrase, "The trend is your friend", trading in only the direction of the long term trend. Looking at the monthly chart below, traders can see the long term rising trend line beginning at the November 2008 low. The price of gold made contact with the trend line both in February and August of 2010, making this a significant trend line. Once the rising trend has been identified, traders should only be long on gold. Entries and exit strategies should then be identified from the daily and hourly charts.
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| EUR Gains as Irish Debt Concerns Diminish Posted: 21 Nov 2010 10:52 PM PST
With a light news day expected, most traders will be anticipating two events as the day progresses. The first is whether or not the rumors of an EU/IMF bailout for Ireland will be proposed in the Irish parliament by her finance minister this afternoon. The second is Jean-Claude Trichet's speech at the European Central Bank's Annual Report in Strasbourg. Optimism has been growing across Europe as investors anticipate the implementation of a bailout for Ireland, which should help shore up concerns about further debt contagion spreading to Portugal and Spain. Here is a roundup of today's events: 15:00 GMT: EUR – Consumer Confidence As a leading indicator of consumer spending, the regional confidence report helps many traders gauge the sentiment in the euro zone. However, since this report is presented in two parts it tends to not have much of an impact on trading, but combined with other data helps fill in a number of gaps in the broader economic picture. If the figure comes out higher than expected, we could see a mild upturn in the EUR. 16:00 GMT: EUR – ECB President Trichet Speaks European Central Bank (ECB) President, Jean-Claude Trichet, is due to speak at the ECB Annual Report in Strasbourg. While the impact of such statements is often not forecast, there is always the possibility that Trichet will comment on a number of developments in the region and hint at future policies. Speculators will attempt to use those statements as a gauge of direction for the EUR in the coming weeks and adjust their positions accordingly. Therefore, this speech will likely create volatility as it gets underway. |
| Posted: 21 Nov 2010 10:49 PM PST
Silver prices rose significantly in the last week and peaked at $27.75 an ounce. However, the 8-hour chart is suggesting that a recent upwards trend is loosing steam and a bearish correction is impending. Forex traders involved with commodities like this can take advantage of this knowledge by going short on silver now, and at a great entry price! • Below is the 8-hour chart for silver by ForexYard. • The technical indicators used are the Slow Stochastic, RSI and Williams Percent Range. • Point 1: There is a "doji" candlestick formed in the chart, indicating that a reversal should take place. • Point 2: The Slow Stochastic indicates a bearish cross, signaling that the next move may be in a downward direction. • Point 3: The RSI signals that the price of this pair currently floats in the over-bought territory, suggesting downward pressure. • Point 4: Williams Percent Range also supports the downward direction. Silver 8-Hour Chart |
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