Forex (& CFD’s) Price Action and Ichimoku Setups May 23rd

Verified Profitable Trader

We are back after a long hiatus from another consulting project but will be writing our weekly article starting this week.  As you might have guessed by the title, we are adding new instruments such as CFD’s and will be mixing Price Action and Ichimoku Analysis.  We have also been working on some new projects/material and will be announcing the new exciting developments/additions on June 1st so stay tuned and we look forward to working with you again!

EURUSD – Daily Chart
After making its impressive 3months+ run above the Kijun since mid Feb. this year, the pair broke down in early May and has not seen the trend line since.  Selling has been pervasive and the 20ema has rejected the pair the last time it resurfaced so sellers still in control as it tries to break the daily Kumo for the first time since Jan. this year.  Should it do so and close below, we expect further losses in the pair because the bottom of the Kumo is also parked right up against the 61.8% fib of the last major upswing so a taking out of both would signal more likely losses for the pair.  However, should it hold, expect the pair to climb up within the Kumo and re-attack the 20ema where it will need to break through and close above to add new technical buyers.

USDCHF – Daily Chart
After three successful TKx signals to the downside, this pair may be ending that run soon as price action is holding steadily above the Kijun which can often lead to turning points in the downtrend.  This does not mean if it gives us another daily TKx signal to the downside we will not take it, but we are watching for further signs of bottoming in the pair.  The upcoming flat top which should come around mid-june is also close to the 50% fib of the last downswing and could provide for more support should a Kumo break happens.  We suggest watching for both and if the pair starts attacking the Kumo or gunning for it, look to the 4hr for an upward TKx signal to trade.  Then wait for the break for further confirmation and then look to take the break should it present the right setup.

AUDUSD – Daily
After running and impressive 1300pips north in a less than two months, the pair gave a kiss to the 1.10 big figure and then sold off aggressively.  Not without putting up a fight as it tried to rebound but the ensuing sell-off was also aggressive.  However, what is interesting to note is the pairs resilience to hold onto the 1.0500 level which also happens to be the 38.2% fib of the aforementioned upswing.  Three times it has bounced off it and failed to close below it every time.  This should be the line in the sand for short and medium traders. If you want to buy, there is your level with tight stops below and if you want to sell, you have two options in taking a play off the 20ema which has rejected price well as of late or take a daily close below today’s low.  The recent 4 day climb which was tentative at best, followed by the impulsive rejection off the 20ema suggests the sellers are more serious and in control at the moment so something to consider if you want to go long.  Should the pair close below the stubborn interim lows here, expect the move toward 1.0350 and possibly 1.0200 where we expect buyers to come back in droves scooping up a cheap aussie.

Brent Sweet Crude Oil – 4hr
After the 2nd failure to break the yearly highs at 113+, the pair was dumped in massive amounts falling $20 in a matter of 3.5 days which was the most impulsive sell off we’ve seen in the pair all year.  The pair has since triple bottomed off the 95 handle but each attempt to bounce gets rejected at lower levels suggesting the sellers are maintaining control and the buyers losing more ground.  The only respite for bulls was today’s double bottom is higher than the current 95 lows so it could the 1st attempt at a higher low to made for the instrument but we will need to see it take out 101.21 before we get more intraday bullish on it.  Short term longs can be had just above 95 with tight stops below targeting 98 and 100 but should 100 reject and send it back down to 95 again, we are not sure it will hold the 4th time.  For now, play the 4hr ranges which have clearly shown their levels and then wait for breaks before taking more aggressive positions.

SPX500 – 4hr
Playing off the pseudo channel in the chart below, the pair is about to post a possible outside reversal candle off the bottom communicating technical players took the bounce off the channel and are expecting the wide channel range to hold.  Should this index close above the previous 4hr candle which was pretty strong and coming at the end of a really aggressive 30pt drop in the last two days, then expect the index to return at least back to the 20ema.  We bought off the 1315 level with a tight stop below the channel and have taken 1st profit bringing the stop to Breakeven and are hoping for a continued upmove towards the 20ema where we will take more profit off the table.  If it can post a 4hr close above the 20ema, then we expect the channel to play out so try not to play anything in between and look for plays at the edge of the channel with slightly more bias to the downside as the sell-offs have been more aggressive as of late.

This is just some of the techniques and methods we use to trade the markets.  If you are interested in learning about these methods further, then make sure to check out our Advanced Ichimoku and Price Action Courses for further training where you can also join a community of traders and get permanent access to our forum for continual education.  For more information about our services, visit

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