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Forex Ichimoku Trade Setups – Nov. 29th
EURUSD – Through
For the first time in a long time, the EURUSD has punched through the daily Kumo which is a very bearish sign for the pair since it has floated above it since July of this year after flirting with it in late summer only to start an impressive run to 1.4284. However the dreadful sell-off since then has been forceful and is not something we want to get in the way of.
Price perfectly closed below the flat bottom, retested it and then sold off further shedding 200pips since then with the pressure continuing. At this point we feel the pair is minimally headed to 1.3074 which is the 50% fib of the entire 1.1875 – 1.4284 run and beyond that, we expect a move back to 1.29 and possibly 1.2793 (61.8% fib of the same move) before anyone will consider getting long again. All signs point bearish with the Kumo break and the Tenkan/Kijun all pointing downward sharply. Selling rallies seems to be the play.
*One last note* in late Oct. this year we were interviewed as to where we think the EURUSD is headed into year end and we called a high not far above 1.42 and that the pair would likely sell-off to 1.33 and 1.31/30 into the year end. You can view this by clicking on the link EURUSD Interview. If you would like to know how we figured this out, make sure to check out our Advaned Ichimoku or Price Action Courses.
USDJPY – Other Side
Like the EURUSD, the USDJPY has broken through the other side of the kumo for the first time since June of this year. The buying has been steady and consistent and now that the pair is through, this should trigger technical models to add longs to the pair. The question is where do we want to get in.
Looking at the kumo, we can see there is a flat section below just above 83.00 which also happens to be the 50% retracement from the last major down run. This could be a nice pull-back level however the pair seems to be supported by the 61.8% retracement of this same move at 83.77. Either could do but the next level up would likely be the 85 level and beyond to the beginning of this move at 85.92. Ultimately we feel this kumo break is a major trend change for the pair and it should likely be supported on dips.
GBPUSD – Diced Through
As suspected and written in the previous posts, we suspected this kumo would not hold up and the pair has diced through the Kumo in 4 candles with the final one punching through forcefully. Since then the pair has yet to pullback to the flat top and we do not suspect it will and figure further losses into the picture. The pair has an interesting support base below starting just around 1.55 and going to 1.5320 so the pair could run into some orders there but we feel this will eventually fall moving on to 1.5200 and possibly to 1.50 either late this year or early next year. There is nothing about this Ichimoku formation which suggests taking longs on this pair and we will look to sell rallies on the pair.
USDCHF – Underperformer
Although the pair has showed structural changes posting higher lows and almost pushing through the kumo on the daily charts, the pair has really underperformed in contrast to the other major USD pairs wherein it has taken the longest time to turn around by needing 2 attempts to hold above the Kijun line. The upcoming kumo structure suggests mild support till mid-dec. this year but after that it gets a little complicated saying it may struggle to build new gains yet should hold the 9500 lows as a bottom in place. We feel this is the least attractive pair to trade from an ichimoku structural viewpoint and would rather concentrate on the others but if we had to play it, it would only to be on the long side possibly taking dips to the 20ema or the Kijun.
AUDUSD – Penetration
For the 1st time since july of this year, the pair has penetrated the Kumo and done so decently suggesting this sell-off is for real. This came after a Kijun break which was then later treated as resistance which further confirms the structural change that the bear side is favored. We have to consider though the Aussie is still the favored against the greenback so it will either take a fight to move it lower or it will sell-off in violent fashion due to the heavy long AUD bias.
For now, we will wait for a daily Kumo break which will ideally be before mid-dec. this year. Should this happen, it will likely accelerate losses. We will look for triggers on the 4hr chart or the daily Kumo break but pullbacks to the 20ema could be used as a play to sell it higher. Just a note of caution as the Kijun is taking its time rolling over.
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 https://2ndskiesforex.com
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