EUR/USD Top Down Analysis

All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.

With all the worries about Europe let's take a quick look into the EUR/USD currency pair with our top down analysis aproach on plain candle charts.

As usual, we begin with the monthly perspective. With looking at this timeframe, we can see that the market found some balance after a one time framing lower behavior for several months. We can see a potential balance area forming here now. The pervious month was an inside month and the current month seem to found some resistance at the possible bracket high. Will we see a move to the bracket low now? We'll see.

Moving forward to the weekly perspective, we can identify two balance areas. Last week the market found support at the previous bracket high as well as at the current bracket low. Inside of the bracket the market is one time framing lower right now. We will observe how the current week will react to this supportive level.

Now to the daily timeframe. A lot of nervosity is visible here in our opinion. Today we formed a balance area and the bracket low could serve as support now. We also marked some more potential support levels if the market would brake below the balance area low. Also, today's market has leaved us with a poor low, that could be a heads up to moving lower here. However, everything is possible here with the political situation in Europe.

To learn a more indepth analysis process with various tools such as VWAP or the TPO profile you can visit our brand new trading community.

Stay focused!

EUR/USD Market Update With TWAP

Yesterday in our EUR/USD Market Update we mentioned the stubborn support level... and it still holds. Today the market tested again that level inside of the daily balance area and could not continue to move lower. Same picture for the US Dollar Index that is trading inside of a bracket with a resistance level.

Daily

240 minutes

US Dollar Index (Daily)

Anyway, here is the TWAP Update for EUR/USD. We will using the monthly, weekly and intra-day TWAP to better visualize the current imbalances and balances that occuring on the various timeframes. Here is the description about TWAP from our Trading Glossary again:

Twap is an abbreviation for the Time Weighted Average Price. This is just like VWAP only it is weighted upon time. This is also an order type that many institutional investors utilize to work in and out of significant positions. It behaves like an Iceberg order by only showing a certain amount of orders to be executed but continues to refresh the orders throughout the session until the position is complete.

Let's start out with the monthly TWAP and we can see a quite rotational month so far. The market is trading around the previous month's VAL close level and sitting currently above the monthly developing value low. There is actually plenty room for a downside move:

With looking at the weekly TWAP, we can see that the market has been rejected several times from the previous week's VAL close level. The market is trading in a rotational behavior here as well.

Moving forward to the intra-day TWAP, we can observe resistance at the previous day's VAH close level and a small selling imbalance in the London session. However, the market found support at our persistent level and lead the market back into the developing value to quiet down a bit.

As said, there is still plenty room for the downside. The US Dollar Index seems also ready to test the daily bracket area high. Anyway, firstly and foremost the market have to breakt the mentioned levels. Keep it simple and be open minded for every scenario.

Stay happy!

All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.

EUR/USD Market Update

After some wild days for the EUR/USD currency pair let's take an updated look into this market. As usual, we going trough our top down analysis process to better understand the market structure and to form some possible conclusions as well as potential scenarios.

Starting off with the macro perspective, we can cleary observe an imbalanced market that one time framing lower since several months. This month the market opened inside of a balance area that occured back in 2003. We'll see how the market will behave at the bracket high/low. Let's keep an eye on that levels.

Also with the weekly chart, we can see a very selling imbalanced market. The previous week ended the one time framing lower condition in some degree but bear in mind that the previous week actually closed below the week's high and formed a potential resistance area. The likelihood of testing the low again should be high.

Moving forward to the daily bars chart strengthens our short conclusions as we can cleary see a balanced market condition here. There is lot of air to the downside but the market have to break a stubborn support level inside of this balance area that holds since several days like in today's market as well.

The 240 minutes chart pointing out today's support at the previous balance area high to the tick:

Last but not least is to take a look into the US Dollar Index. Here we can see a balanced behavior in the daily perspective with a potential test of the bracket high conclusion.

If the market could break this mentioned support level inside of the daily balance area we should see some lower movements to the bracket low. As we know the currency market is sometimes a uncertain area with wild swings, so look out and calculate as well as manage your risk with the highest attention.

Next time we will take a look with TWAPs on this market again.

Anyway, stay happy!

All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.

EUR/USD (6E) TWAP Market Update

All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.

Here is a quick top down TWAP perspective on the currency pair EUR vs USD. Firstly let's take a look into our Trading Glossary about TWAP:

Twap is an abbreviation for the Time Weighted Average Price. This is just like VWAP only it is weighted upon time. This is also an order type that many institutional investors utilize to work in and out of significant positions. It behaves like an Iceberg order by only showing a certain amount of orders to be executed but continues to refresh the orders throughout the session until the position is complete.

With this informaiton in our mind let's going through the monthly, weekly and intra-day TWAPs. Make sure to have time based charts as this is a Time based tool. However, this is our logical preference but you can playing around with whatever other chart formats as well. The Forex market is a 24 hours market, so there is no point in using a 'London Session', 'U.S. Session' or name them all. With that said, all charts here are ETH/Globex based and representing the march futures contract (6E). Like always it is your free choice in which way you will use this tool.

As usual, we beginning with the monthly TWAP. Looking at this installed tool, we can see a cleary selling imbalance with the developing value slope to the downward. The market opened below the previous month's value close area and since that point it rejects the developing value low. In summary a very bearish rated view here.

Moving forward to the weekly TWAP, we can observe an open below the previous week's value close area with a developing value slope to the upward. Additionally the market is trading in a balanced behavior, so a break above should lead us to the previous week's VAL close level but we should be very careful to take any long trades with the bearish HTF macro perspective, especially with the strong US Dollar index. Anyway, everything can happen and we should have an open mind for potential changes in the market context.

Now looking at the intra-day VWAP, we can see an open below Friday's value close area and a developing value slope to the upward. Currently we got back into the previous value area and trading above the developing value. Test of the previous TWAP close level as well as a rotational move back to the developing value low are possible scenarios. We'll see what will happen here.

For more informations about our Trade Methodology and our Top Down process we refer to create an account on our trading community. You can join for free or support the community with an elite membership. With this membership level you will have access to chart templates, trading journals and a huge wealth of informations about various trading focused subjects. We hope to see you soon.

Stay happy!

EUR/USD Market Update

All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.

Here is a quick market update for EUR/USD. As always, we will looking for the path of least resistance with our top down analysis process. It is the most significant part in our daily trading to read and understand the market story with various tools on several timeframes. With that said, let's start out with the monthly bars chart.

With looking on the monthly chart, we can still see the major one time framing lower market that occurs since eight months. Also the previous month's low got taken out immediately to moving lower and lower. Currently the market testing a potential support area. The market participants awaiting Thursday's ECB decision about the QE program, so it will be very interesting to observe the market behavior here.

Moving forward to the weekly chart, we can see the market rejected several times the balance area low to finally continue its one time framing lower behavior here as well. Currently we have a rotational inside week as the market did not took out the previous week's high or low. We can also identify that the previous week closed above the marked support level.

As we are analyze the weekly bars chart we should also consider a look on the weekly TWAP. The market opened below the previous weeky value close area. The developing value slope is somewhat flat and we can cleary see the rotational behavior. However, we are trading below the weekly developing value and there is enough room to the downside.

With looking at the daily bars chart, we can observe a one time framing lower behavior and two inside days. As mentioned before the market participants awaiting Thursday's decision, so we should expect one more rotational inside day before the market get really wild.

If you wish to learn more about our Trade Methodology please visit our website. You can also use our free Trading Glossary if you do not understand some terms that we use in our posts.

Be careful and stay open minded as well as happy!

EUR/USD Market Analysis

All information is for educational use only and is not investment advice. There is a substantial risk of loss in trading commodity futures, stocks, options and foreign exchange products. Past performance is not indicative of future results.

Amazing short move in EUR/USD today. Let's take a quick look on this market with a top down analysis combined with a nice trade opportunity to catch this straight move down.

We beginning like always with the macro monthy bars chart. The market one-time-framing since 6 months lower and last month's low got taken out as well. The market could reach the next support area.

On the weekly bars chart we can identify a bracket area. This week opened at the lower line of this balance area, took out last week's low and trading below the bracket currently. Here is the next potential support area marked as well.

Moving forward to the daily chart we can observe how the previous day's market took out the low from two days ago and closed below the bracket area. Today the market rejected the balance area low and took out yesterday's low as well as the low from three days ago.

Now to the trade opportunity for today. Observing the weekly TWAP we can see how the market trading below last week's value, found resistance at this week's developing value high and moved streight through the DTWAP and DVAL.

With the more bearish HTF informations as well as the knowledge about the potential resistance at the weekly developing value high a trade as soon as the market got back into value with a stop placement above today's high made sense. Logical scale target would be the other side of weekly developing value.

With that said, we hope you've benefit from today's market action in EUR/USD and if not the next opportunity will arrive for sure. In the meantime you can visit our trading commmunity to learn more about our trade methodology and risk management approach. With our premium education content you can acquire knowledge about a tactical and strategic position management with logical stop as well as target placments.

Stay happy!

TWAP in action: EUR/USD

Twap is an abbreviation for the Time Weighted Average Price. This is just like VWAP only it is weighted upon time. This is also an order type that many institutional investors utilize to work in and out of significant positions. It behaves like an Iceberg order by only showing a certain amount of orders to be executed but continues to refresh the orders throughout the session until the position is complete.

With that said, let's take a look at today's EUR/USD action with TWAP. On the monthly TWAP we can observe a reaction at the developing value area high and a move down straight through the TWAP to the DVAL. This DVAH was also somewhat confluent with last month's VAL close level.

More interesting on the weekly TWAP is the confluence with last week's VAH close level. Amazing reaction at this level lead us to the other side and below of value.

With a elite membership on the Private Banker community you can read a more indepth top down analysis here: EUR/USD Top Down Market Analysis

And alongside with a premium membership you can learn to use tools like VWAP/TWAP properly. Also to mention is our Trading Glossary to better understand the various terms we use in our tweets and posts.

Stay happy,

Sebastian