{"id":19950,"date":"2013-09-27T18:21:03","date_gmt":"2013-09-28T01:21:03","guid":{"rendered":"http:\/\/drduru.com\/onetwentytwo\/?p=19950"},"modified":"2013-09-27T18:21:03","modified_gmt":"2013-09-28T01:21:03","slug":"watch-forex-action-unfold-react-not-anticipate","status":"publish","type":"post","link":"https:\/\/drduru.com\/onetwentytwo\/2013\/09\/27\/watch-forex-action-unfold-react-not-anticipate\/","title":{"rendered":"Time to Watch the Forex Action Unfold: React, Not Anticipate"},"content":{"rendered":"<p><strong>(This is an excerpt from an article I originally published on Seeking Alpha on September 26, 2013. <a href=\"http:\/\/seekingalpha.com\/article\/1715142-time-to-watch-the-forex-action-unfold-react-not-anticipate\" target=\"_blank\">Click here to read the entire piece<\/a>.)<\/strong><\/p>\n<p>It has been a week since the Federal Reserve surprised the globe when it backed off from its earlier tough talk about bond tapering. The U.S. dollar index (UUP) plunged in response but it has yet to follow-through on that selling:<\/p>\n<p><center><br \/>\n<figure id=\"attachment_19951\" aria-describedby=\"caption-attachment-19951\" style=\"width: 540px\" class=\"wp-caption aligncenter\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_DXY0.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_DXY0.png\" alt=\"The U.S. dollar index plunges post-Fed but is still hovering above the lower part of a wide trading range\" width=\"550\" height=\"375\" class=\"size-full wp-image-19951\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_DXY0.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_DXY0-300x204.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-19951\" class=\"wp-caption-text\">The U.S. dollar index plunges post-Fed but is still hovering above the lower part of a wide trading range<\/figcaption><\/figure><br \/>\n<\/center><\/p>\n<p>This was a case where the market seems to have guessed correctly about the likelihood of tapering. {snip}<\/p>\n<p>I am still bullish in the short\/intermediate-term for the U.S. dollar. I expect that in due time the U.S. dollar index will trade back to the top of the current range. However, as I searched and reached for reasons to continue justifying this stance, it occurred to me that the forex market in general has been surprisingly listless since the Fed meeting compared to the immediate post-Fed response. It as if markets are coiling in preparation for the next big move. It is hard to tell whether the forex markets will treat a U.S. budgetary impasse as dollar-good (a &#8220;safe haven&#8221;) or dollar-bad (relative downgrade in economic prospects). At times like these, I like to remove my chips and watch, listen, and learn.<\/p>\n<p>Here are the biases I currently maintain as I wait for the next tradable entry points and\/or catalysts.<\/p>\n<p><strong>British pound<\/strong> (FXB)<br \/>\n{snip}<br \/>\n<center><br \/>\n<figure id=\"attachment_19954\" aria-describedby=\"caption-attachment-19954\" style=\"width: 540px\" class=\"wp-caption aligncenter\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_GBPUSD.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_GBPUSD.png\" alt=\"The pound has raced against the dollar this month\" width=\"550\" height=\"375\" class=\"size-full wp-image-19954\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_GBPUSD.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_GBPUSD-300x204.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-19954\" class=\"wp-caption-text\">The pound has raced against the dollar this month<\/figcaption><\/figure><br \/>\n<\/center><\/p>\n<p>{snip}<\/p>\n<p><strong>Euro<\/strong> (FXE)<br \/>\n{snip}<br \/>\n<center><br \/>\n<figure id=\"attachment_19956\" aria-describedby=\"caption-attachment-19956\" style=\"width: 540px\" class=\"wp-caption aligncenter\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_EURUSD.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_EURUSD.png\" alt=\"The euro is reaching its high for the year against the U.S. dollar\" width=\"550\" height=\"375\" class=\"size-full wp-image-19956\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_EURUSD.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_EURUSD-300x204.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-19956\" class=\"wp-caption-text\">The euro is reaching its high for the year against the U.S. dollar<\/figcaption><\/figure><br \/>\n<\/center><\/p>\n<p><strong>The Canadian dollar<\/strong> (FXC)<br \/>\n{snip}<br \/>\n<center><br \/>\n<figure id=\"attachment_19958\" aria-describedby=\"caption-attachment-19958\" style=\"width: 540px\" class=\"wp-caption aligncenter\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_USDCAD.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_USDCAD.png\" alt=\"The U.S. dollar has trended upward against the Canadian dollar for a year with wild swings in between retests of the trendline\" width=\"550\" height=\"375\" class=\"size-full wp-image-19958\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_USDCAD.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_USDCAD-300x204.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-19958\" class=\"wp-caption-text\">The U.S. dollar has trended upward against the Canadian dollar for a year with wild swings in between retests of the trendline<\/figcaption><\/figure><br \/>\n<\/center><\/p>\n<p><strong>Japanese yen<\/strong> (FXY)<br \/>\n{snip}<br \/>\n<center><br \/>\n<figure id=\"attachment_19960\" aria-describedby=\"caption-attachment-19960\" style=\"width: 540px\" class=\"wp-caption aligncenter\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_USDJPY.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_USDJPY.png\" alt=\"As the oscillations in USD\/JPY decline, it seems a breakout (or down?) looms close by\" width=\"550\" height=\"375\" class=\"size-full wp-image-19960\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_USDJPY.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_USDJPY-300x204.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-19960\" class=\"wp-caption-text\">As the oscillations in USD\/JPY decline, it seems a breakout (or down?) looms close by<\/figcaption><\/figure><br \/>\n<\/center><\/p>\n<p>{snip}<\/p>\n<p><strong>Australian dollar<\/strong> (AUD\/USD)<br \/>\n{snip}<\/p>\n<p><center><br \/>\n<figure id=\"attachment_19961\" aria-describedby=\"caption-attachment-19961\" style=\"width: 540px\" class=\"wp-caption aligncenter\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_AUDUSD.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_AUDUSD.png\" alt=\"The Australian dollar has finally reversed its post-Fed gains, but the W-bottom still looks secure\" width=\"550\" height=\"375\" class=\"size-full wp-image-19961\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_AUDUSD.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_AUDUSD-300x204.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-19961\" class=\"wp-caption-text\">The Australian dollar has finally reversed its post-Fed gains, but the W-bottom still looks secure<\/figcaption><\/figure><br \/>\n<\/center><\/p>\n<p><strong>Swiss Franc<\/strong> (FXF)<br \/>\n{snip}<br \/>\n<center><br \/>\n<figure id=\"attachment_19962\" aria-describedby=\"caption-attachment-19962\" style=\"width: 540px\" class=\"wp-caption aligncenter\"><a href=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_EURCHF.png\"><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_EURCHF.png\" alt=\"A very choppy 1-year uptrend from the 1.20 floor\" width=\"550\" height=\"375\" class=\"size-full wp-image-19962\" srcset=\"https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_EURCHF.png 550w, https:\/\/drduru.com\/onetwentytwo\/wp-content\/uploads\/2013\/09\/130925_EURCHF-300x204.png 300w\" sizes=\"auto, (max-width: 550px) 100vw, 550px\" \/><\/a><figcaption id=\"caption-attachment-19962\" class=\"wp-caption-text\">A very choppy 1-year uptrend from the 1.20 floor<\/figcaption><\/figure><br \/>\n<strong>Source: <a href=\"http:\/\/www.freestockcharts.com\/\" target=\"_blank\">All charts from FreeStockCharts.com<\/a><\/strong><br \/>\n<\/center><\/p>\n<p>Be careful out there!<\/p>\n<p><strong>(This is an excerpt from an article I originally published on Seeking Alpha on September 26, 2013. <a href=\"http:\/\/seekingalpha.com\/article\/1715142-time-to-watch-the-forex-action-unfold-react-not-anticipate\" target=\"_blank\">Click here to read the entire piece<\/a>.)<\/strong><\/p>\n<p>Full disclosure: no positions<\/p>\n","protected":false},"excerpt":{"rendered":"<p>(This is an excerpt from an article I originally published on Seeking Alpha on September 26, 2013. Click here to read the entire piece.) It has been a week since the Federal Reserve surprised the globe when it backed off from its earlier tough talk about bond tapering. The U.S. dollar index (UUP) plunged in &#8230; <a title=\"Time to Watch the Forex Action Unfold: React, Not Anticipate\" class=\"read-more\" href=\"https:\/\/drduru.com\/onetwentytwo\/2013\/09\/27\/watch-forex-action-unfold-react-not-anticipate\/\">Read more<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[386,235,921,794,58,20,512,511,62,920],"tags":[308,385,376,1595,309,127,297,447,459,513,384,625,115,334,1597,469,454],"class_list":["post-19950","post","type-post","status-publish","format-standard","hentry","category-australia","category-canada","category-downtrend","category-europe","category-federal-reserve","category-forex","category-resistance","category-support","category-technical-analysis","category-uptrend","tag-audusd","tag-eurchf","tag-eurusd","tag-federal-reserve","tag-fxa","tag-fxb","tag-fxc","tag-fxe","tag-fxf","tag-fxy","tag-gbpusd","tag-james-bullard","tag-monetary-policy","tag-swiss-national-bank","tag-technical-analysis","tag-usdcad","tag-usdjpy"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Time to Watch the Forex Action Unfold: React, Not Anticipate - ONE-TWENTY TWO: Trading Financial Markets<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/drduru.com\/onetwentytwo\/2013\/09\/27\/watch-forex-action-unfold-react-not-anticipate\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Time to Watch the Forex Action Unfold: React, Not Anticipate - ONE-TWENTY TWO: Trading Financial Markets\" \/>\n<meta property=\"og:description\" content=\"(This is an excerpt from an article I originally published on Seeking Alpha on September 26, 2013. 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Click here to read the entire piece.) It has been a week since the Federal Reserve surprised the globe when it backed off from its earlier tough talk about bond tapering. The U.S. dollar index (UUP) plunged in ... 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