The trend is down on the GBP/USD, sell the rallies

Forexmentor.com Forex Trading Price Action

Yesterday, in the AM Review, I told you that the pound was trending down, as evidenced by the 200 EMA on the lower-level charts. I indicated that the news rally at 8:30 am ET was just that – a rally in a downtrend. I further indicated that price would probably meet considerable resistance at the 200 EMA mark, should it try to go there again. And, try it did – at noon ET – only to fail. That’s the power of the bellwether 200 EMA indicator, voted the best of the bunch years ago. Need any more proof? Well, the trend today is still down, and price continues to try to rear its head – only to get smashed down again. Translation: Sell those rallies folks. Where have you heard that before? Lest we not forget that the Big Dogs are extremely short the pound, as evidenced by COT data (read, commitments of traders). Today, we had another rally just before the London open – and that one didn’t go anywhere either. I could go on and on, but why not just go to www.forexmentor.com and find out what else the Big Dogs are not telling you about their every move.

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I suspect price on the GBP/USD will continue to meet heavy resistance

Forexmentor.com Forex Trading Price Action

As you probably know by now, the commercial traders are extremely short the pound, as they are the aussie. So, today, I thought I'd have a boo at what's going on with the GBP/USD pair. Last night, well before the London open, the trend on the hourly and 15 minute charts was down, if you believe what the 200 EMA was telling us. Today, well after the London open, price rose on the pair to test that level - only to be repelled at news time. I suspect price will continue to meet heavy resistance there. Years ago, the 200 EMA was voted the best indicator to us of the 99 available to traders. So, when you see it trending, you want to pay attention to it, and price's behavior in relation to it. I have been asked why I focus on the London session. Well, it just happens to be the busiest of all the sessions, of which there are seven. Activity spikes up at the London open, and then falls off from there. The London foreign exchange market is the mother of all forex activity.

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The GBP/USD pair is headed south

Forexmentor.com Forex Trading Price Action

Who could have guessed? The commercial traders are extremely short the pound. Translation: The GBP/USD pair is headed south. Last night, well before the London open, we had negative divergence on the daily chart, a downward-sloping MACD with good angle and separation on the 4 hour chart, a downward-sloping 200 EMA on the 1 hour chart, and evidence of a down-trend continuation pattern on the 15 minute chart. After price consolidated into today’s session, all the while MACD neutralized back up to the waterline, it was ‘bombs away.’ Leg two of the downtrend continuation pattern kicked in. And, oh yes, I hate to rub it in, but the USD/CAD pair is now up to 1415. You all who took my advice, and got into that trade, must be grinning from ear to ear by now. I’ll take that. Also, the euro suffered a downtrend continuation pattern too today and, just like clockwork, the Swissy pair (USD/CHF) came through with an uptrend continuation pattern. So, the Three Musketeers marched to the same tune today. Hooray! Find out what you’re missing by joining the members area at www.forexmentor.com.

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The USD/CHF pair should see further price weakness

Forexmentor.com Forex Trading Price Action

You’re all on board with the USD/CAD pair right? If not, I honestly don’t know what’s holding you back. All technical and fundamental signs point to higher prices. And, even some of the so-called experts are now coming around. Maybe they joined www.forexmentor.com? Anyway, let’s acknowledge that trading opportunities abound. According to the latest commitments of traders data (a.k.a. COT), the Big Dogs are extremely short the Aussie and Pound. Now, what do you think that means? You got it! Sell those rallies folks. The USD/CHF pair (Swissy) is no different. The commercial traders (a.k.a. Big Dogs) are net long the Swiss franc, meaning this pair should see further price weakness. I see a bear flag in a downtrend on the weekly chart. That can mean only one thing – watch out below!

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