Thursday, December 15, 2011

Currencies and Profiting from Abandoned Babies (FXB)

Following up on Dec. 4's "Technical Analysis: Beware the Gravestone Doji":
You sneer at 'Hindenburg Omens', you eat 'Death Crosses' for Breakfast.
Alright tough guy...
From Dragonfly Capital:
As I started to prep for Thursday with the Holiday music flowing and the decorations up all around me I noticed something joyous. What could it be? Well possibly a couple of abandoned babies! Not the kind that will shiver in the cold without their mothers caring for them, but the kind in the charts of a couple of beaten down currency ETF’s that if the pattern completes signals a reversal. Let’s take a look.

Currency Shares British Pound Sterling Trust, $FXB

Currency Shares British Pound Sterling Trust, $FXB, started a move lower in early November and ran lower until catching itself around the 153.25 level and moving back higher to the 50 day Simple Moving Average. Since touching there it has moved back lower and is now at that November low, printing a long legged Doji candle. Doji are signals of indecision and often reversal. If this is confirmed higher tomorrow, completing an Abandoned Baby pattern, the worst may be over for now....MORE
From FX Words:

   Direction: Bullish
   Type: Reversal
   Reliability: Strong