Australian Dollar H'10 - NEGATIVE SHIFT

** NEUTRAL NEGATIVE EXTREME **

The MAR'10 AUSTRALIAN DOLLAR futures contract is on the offer and pressing into the lower extreme for its current digestive pattern and remains on edge below the 9015 Inflection Pivot.

On the SELL side accept REVERSAL strategies over FADE within the 9015-8988 area and 9128 resistance level expecting a return to a trend less trading environment rather than a new negative trend move. Avoid BREAKOUT strategies below 8881 and 8812 but rather FADE into a positive reaction after a negative breakdown signal. The MKT is extended and will have trouble sustaining any new weakness. Use aggressive position management and anticipate potential early exit points to reduce profit give-back.

On the BUY side FADE and REVERSAL strategies off the 8881 and 8812 major support base are qualified however the FADE is a lower probability and should use tight risk criteria. REVERSALs can risk more but should also go for more profit with the expectation of the MKT putting in a short term turning point signal. BREAKOUT strategies above 9015 are aggressive and should just "go" and not look back. Risk less, use aggressive position management and conservative profit limits.

Note: The MKT is in neutral at a technical extreme. Early weakness has the potential to be a good positive REVERSAL opportunity so have a plan and be prepared on any major support failures that happen at the beginning of the session. Remember as well that just because the MKT is extended to the downside does not mean it can get more extended, targeting just below where you would put your stop on any longs.

JS

For more information please contact me at info@jsservices.com. You can also visit http://www.jsservices.com/.The Inflection Pivot levels are available as a chart overlay on the following platforms; Ninja trader, Strategy Runner and eSignal. Sign up for a Complimentary FREE Trial.

STRATEGY BASED TRADING - BULL TREND CORRECTION

Continuing with the BULL TREND CORRECTION focus the Currencies have provided us opportunity for this signal state. Each MKT presented has produced a negative signal against an underlying positive trend. Is this signal going to follow through to the downside or is this just an opportunity to re-enter a positively trending MKT.

* Please read the previous posts for the week on BULL TREND CORRECTION as well as the webvidoe tutorial links.

To answer this question we look at the MKTs behavioral state and the specific price point or inflection pivot where sentiment for the signal is confirmed or denied. Trading at this price point is optimal however aligning your signal acceptance to the sentiment bias in the BULL TREND CORRECTIVE state will enhance your performance.

For today, September 25 2009 - The following MKTs are in a BULL TREND CORRECTIVE state:

EU = EUROFX Dec'09 – 14681 Inflection Pivot

DA = Australian Dollar – 8534 Inflection Pivot

AUDJPY = Aussie / Yen – 7905 Inflection Pivot

EUROFX Z'09 - The MKT produced a negative signal against an underlying positiver trend and will remain in a BULL TREND CORRECTION technical state below the 14681 Inflection Pivot. If the negative action is going to continue the currency will struggle to maintain a trade above 14681. A failure from 14609 confirm fresh selling targeting 14517 on any negative follow through.

A held rise above 14681 removes the negative threat sparking a rally up to 14767. Stay nimble. This move does have potential to be the beginnings of a new leg higher however the Friday trade will most likely keep the trade digestive.

Australian$ z'09 - The MKT is expected to shrug off yesterday's negative signal with all trading above the 8534 Inflection Pivot. Keep a buy break bias above here expecting the positive momentum to remain in force. Only under 8534 does sentiment shift.


AUDJPY - The cross is trying to find its footing but will continue to struggle with all trading below the 7906 Inflection Pivot. This is the high point for any buying today if the negative corrective signal is going to remain in force. A rise above 7905 revives the aggressive buyers with 7958 the initial target. Work any sustain positive structure with expectations for a run at the recent move highs at 8006.



JS



Strategy Based Trading is a methodology that focuses on the applied strategy verses a specific market and looks to align strategies with markets whose current technical behavior matches the strategies criteria.


Please review the following CME sponsored tutorial for a complete overview of this approach.STRATEGY BASED TRADING Review http://progressive.powerstream.net/008/00102/edu/interactive/js_services/strategy_based_trading/index.html


For more information please contact me at info@jsservices.com. You can also visit http://www.jsservices.com/.The Inflection Pivot levels are available as a chart overlay on the following platforms; Ninja trader, Strategy Runner and eSignal. Sign up for a Complimentary FREE Trial.