The Article for this Week is the wrap up of the two articles I wrote last Month July 2013 shown in the links below.

http://www.dukascopy.com/fxcomm/fx-article-contest/?Live-Forex-Trade-Set-Up&action=read&id=1449

http://www.dukascopy.com/fxcomm/fx-article-contest/?Live-Forex-Trade-Set-Up&action=read&id=1461#article-comments

The articles reveal the secret on how the Support, Resistance, Trendline, Upper and Lower Channel, Trend and Candle patterns could help you to identify dynamic swing points, reversals and continuation patterns following the underlying trend from Daily to Monthly time frames.

This week article will clearly explain trend direction and how to hold the positions when set up are establish. The video below explain all that is written in this article.

http://www.youtube.com/watch?v=d0R6OAhuY0s&feature=youtu.be

The Pairs under consideration are Dollar Index, EURUSD, GBPUSD, USDCHF UASJPY and USDCAD.

DOLLAR INDEX WEEKLY CHART

The USD Index is still in a bearish trend starting from when the set up was ready. Last week candle closed bearish without any indication of reversal pattern. The price is close to the Inner Trendline (blue line) drawn on weekly time frame and Outer Trendline (Red line) originated from Monthly time frame. As the price hit the Trendline wait for price reaction to produce Candle reversal or continuation patterns before you can take any trade decision on weekly time frame. Note that as Dollar Index is in a bearish trend, EURUSD, GBPUSD will be in a bullish trend while USDCHF, USDCAD and USDJPY will maintain a bearish trend.

Below screenshot shows the USD Index Weekly chart showing all that was explained above.

http://screencast.com/t/oZzezhdK3

EURUSD WEEKLY CHART

EURUSD have really moved in a bullish trend from when the Outside Bar Set Up from the Weekly Support that I spotted out in my first article last Month July 2013 in the second Week. The Price is much close to the Weekly Trendline and the Resistance. As the price continues to move in an upward direction, the Weekly Trendline and Resistance should be watch closely for possible price reaction for the formation of either a Bullish Reversal Candle Pattern or a Bearish Continuation Candle Pattern before the next decision can be taken at the Weekly time frame. If the Trendline and Resistance are broken zoom to a lower time frame (H4 and H1 time frames) respectively to look for a pullback the will re-test the Trendline or Resistance for a new entry point. As far as the Dollar Index explained above remains bearish then EURUSD will continue to move in a bullish direction.

Below chart shows the image of EURUSD Weekly chart showing all the tools mentioned above for clearer understanding.

http://screencast.com/t/ISMyHtRJPl6

GBPUSD WEEKLY CHART

GBPUSD have moved in a bullish trend from when the Inside Bar Set Up from the Weekly Support that I spotted out in my first article last Month July 2013 in the second Week. The Price has much room to the Weekly Trendline and the Resistance. As the price continues to move in an upward direction watch the weekly Trendline and Resistance closely for possible price reaction for the formation of either a Bullish Reversal Candle Pattern or a Bearish Continuation Candle Pattern before the next decision can be taken at the weekly time frame. If the Trendline and Resistance are broken zoom to a lower time frame (H4 and H1 time frames) respectively to look out for a pullback to re-test the Trendline or Resistance for a new entry point. As far as the Dollar Index explained above remains bearish, GBPRUSD will continue to move in a Bullish trend. The only different between GBPUSD and EURUSD based on chart is the Set Up. GBPUSD set up is Inside Bar while EURUSD is Outside Bar. The two pairs are correlated meaning that they move in the same direction. Even if both pair is correlated the analysis should be carried out in individual pair.

Below chart shows the image of GBPUSD weekly chart showing all the tools mentioned above for clearer understanding.

http://screencast.com/t/HbKc1oifwGB

USDCHF WEEKLY CHART

USDCHF have moved in bearish Trend from when the Railway Track Set Up from the Weekly Support that I spotted out in my first article last Month July 2013 in the second Week. The Price now has much room to the Weekly Support. As the price continues to move in a downward direction watch the weekly Support closely for possible price reaction for the formation of either a Bullish Reversal Candle Pattern or a Bearish Continuation Candle Pattern before the next decision can be taken at the weekly time frame. If the Support is broken zoom to a lower time frame (H4 and H1 time frames) respectively to look for a pullback that will re-test the Support for a new entry point. As far as the Dollar Index explained above remains bearish, USDCHF will continue to move in a bearish trend.

Below chart shows the image of USDCHF weekly chart showing all the tools mentioned above for clearer understanding.

http://screencast.com/t/uHkdwda2

USDJPY WEEKLY CHART

USDJPY have moved in a bearish Trend from when the Railway Track Set Up from the Weekly Resistance that I spotted out in my first article last Month July 2013 in the second Week. There is something that happened to this pair that makes it unique from the other pairs. When you look at the pair critically you will observe that after the set up in the following week the price did not fall immediately but it ret-tested the Resistance before it started in the bearish trend. This is the more reason why I recommend that whenever a set up is spotted out in higher time frames always zoom to the lower time to observe price reaction for possible pullback in the direction of the trend established at the higher time frames before the position can be place. Again it is good place trade position using pending orders (Sell and Buy Stop) to place your position after the pullback to avoid being stopped out. Also place the stop loss some pips above the Resistance. Price has much room to the Weekly Support as the pair in a bearish trend. As the price continues to move in a downward direction watch the weekly Support closely for possible price reaction for the formation of either a Bullish Reversal Candle Pattern or a Bearish Continuation Candle Pattern before the next decision can be taken at the weekly time frame. If the Support is broken zoom to a lower time frame (H4 and H1 time frames) respectively to look for a pullback that will re-test the Support for a new entry point. As far as the Dollar Index explained above remains bearish, USDJPY will continue to move in a bearish trend.

Below chart shows the image of USDJPY weekly chart showing all the tools mentioned above for clearer understanding.

http://screencast.com/t/b21PqgtcX

USDCAD WEEKLY CHART

USDCAD have moved in a bearish Trend from when the Dogi (Spinning Top) Set Up from the weekly Upper Channel that formed last five weeks ago. When you look at the pair critically you will observe that after the set up the following week the price did not fall immediately but it ret-tested the Upper Channel and Resistance before it started in the bearish trend. Whenever the trade set up is established at the higher time frames, zoom to lower time to wait for a pullback that will re-test the Upper Channel or the Resistance before you can place trade in the direction of the trend. As the price continues to move in a downward direction watch the weekly lower Channel closely for possible price reaction for the production of either a Bullish Reversal Candle Pattern or a Bearish Continuation Candle Pattern before the next decision can be taken at the weekly time frame. If the weekly lower Channel is broken zoom to a lower time frame (H4 and H1 time frames) respectively to look out for a pullback to re-test the Support for a new entry point. As far as the Dollar Index explained above remains bearish, USDCAD will continue to be in a Bearish Trend.

Below chart shows the image of USDCAD weekly chart showing all the tools mentioned above for clearer understanding.

http://screencast.com/t/fiNKmtMR



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