1. Introduction In today's interconnected financial markets, major fiat currencies like the Euro (6E) and Yen (6J) play a critical role in influencing USD-denominated assets. The relative strength between these currencies often reflects underlying economic trends and risk sentiment, which ripple across key markets like Treasuries (ZN), Gold (GC), and Equities (ES). However, Bitcoin (BTC), a non-traditional digital asset, introduces an interesting divergence. Unlike fiat currencies, BTC's behavior during periods of significant market stress may reveal a unique relationship to USD movements. This article explores: The relative strength between the Euro and Yen. Correlations between fiat currencies, BTC, and USD-denominated markets. Whether BTC reacts similarly or differently to traditional currencies during market volatility. By analyzing these dynamics, we aim to identify how shifts in currency strength influence assets like Treasuries while assessing BTC’s independence or alignment with fiat markets. 2. Relative Strength Between 6E and 6J To evaluate currency dynamics, we compute the relative strength of the Euro (6E) versus the Yen (6J) as a ratio. This ratio helps identify which currency is outperforming, providing insights into broader risk sentiment and market direction. Another way to think of this ratio would be to use the RY1! Ticker symbol which represents the Euro/Japanese Yen Futures contract. https://www.tradingview.com/x/sUMqSyVC/ Correlation Heatmaps The correlation heatmaps below highlight relationships between: o Currencies: Euro (6E), Yen (6J), and Bitcoin (BTC). o USD-Denominated Markets: Treasuries (ZN), S&P 500 (ES), Crude Oil (CL), Gold (GC), and Corn (ZC). o Key Observations (Daily Timeframe): The 6J (Yen) shows a positive correlation with Treasuries (ZN), supporting its traditional role as a safe-haven currency. Bitcoin (BTC) demonstrates mixed relationships across assets, showing signs of divergence compared to fiat currencies during specific conditions. o Key Observations (Weekly and Monthly Timeframes): Over longer timeframes, correlations between 6E and markets like Gold (GC) strengthen, while the Yen's (6J) correlation with Treasuries becomes more pronounced. BTC correlations remain unstable, suggesting Bitcoin behaves differently than traditional fiat currencies, particularly in stress periods. https://www.tradingview.com/x/JrHvhgOI/ https://www.tradingview.com/x/Xrop6oaC/ https://www.tradingview.com/x/Oaadkm2q/ 3. BTC Divergence: Behavior During Significant Moves To assess BTC's behavior during stress periods, we identify significant moves (beyond a predefined threshold) in the Euro (6E) and Yen (6J). Using scatter plots, we plot BTC returns against these currency moves: BTC vs 6E (Euro): BTC returns show occasional alignment with Euro movements but also exhibit non-linear patterns. For instance, during sharp Euro declines, BTC has at times remained resilient, highlighting its decoupling from fiat. BTC vs 6J (Yen): BTC's reaction to Yen strength/weakness appears more random, lacking a clear pattern. This further underscores BTC’s independence from traditional fiat dynamics, even as Yen strength typically aligns with safe-haven asset flows. https://www.tradingview.com/x/4mDIh4D2/ https://www.tradingview.com/x/VczcQQrS/ https://www.tradingview.com/x/4bEMknji/ The scatter plots reveal that while fiat currencies like the Euro and Yen maintain consistent relationships with USD-denominated markets, Bitcoin exhibits periods of divergence, particularly during extreme stress events. 4. Focus on Treasury Futures (ZN) Treasury Futures (ZN) are among the most responsive assets to currency shifts due to their role as a safe-haven instrument during economic uncertainty. Treasury prices often rise when risk aversion drives investors to seek safer assets, particularly when fiat currencies like the Yen (6J) strengthen. 6E/6J Influence on ZN From the correlation heatmaps: The Yen (6J) maintains a positive correlation with ZN prices, particularly during periods of market stress. The Euro (6E) exhibits a moderate correlation, with fluctuations largely dependent on economic events affecting Eurozone stability. When relative strength shifts in favor of the Yen (6J) over the Euro (6E), Treasury Futures often attract increased demand, reflecting investor flight-to-safety dynamics. Forward-Looking Trade Idea Given the above insights, here’s a hypothetical trade idea focusing on 10-Year Treasury Futures (ZN): Trade Direction: Long Treasury Futures to capitalize on potential safe-haven flows. Entry Price: 109’29 Target Price: 111’28 Stop Loss: 109’09 Potential for Reward: 126 ticks = $1,968.75 Potential for Risk: 40 ticks = $625 Reward-to-Risk Ratio: 3.15:1 Tick Value: 1/2 of 1/32 of one point (0.015625) = $15.625 Required margin: $2,000 per contract This trade setup anticipates ZN’s upward momentum if the Yen continues to outperform the Euro or if broader risk-off sentiment triggers demand for Treasuries. 5. Risk Management Importance Trading currency-driven assets like Treasury Futures or Bitcoin requires a disciplined approach to risk management due to their volatility and sensitivity to macroeconomic shifts. Key considerations include: a. Stop-Loss Orders: Always use stop-loss levels to limit downside exposure, especially when markets react sharply to currency moves or unexpected news. b. Position Sizing: Adjust position size to match market volatility. c. Monitor Relative Strength: Continuously track the 6E/6J ratio to identify shifts in currency strength that could signal changes in safe-haven flows or BTC behavior. d. Non-Correlated Strategies: Incorporate BTC into portfolios as a non-correlated asset, especially when fiat currencies exhibit linear correlations with traditional markets. By implementing proper risk management techniques, traders can navigate the ripple effects of currency moves on markets like Treasuries and Bitcoin. 6. Conclusion The relative strength between the Euro (6E) and Yen (6J) provides critical insights into the broader market environment, particularly during periods of stress. As shown: Treasury Futures (ZN): Highly sensitive to Yen strength due to its safe-haven role. Bitcoin (BTC): Demonstrates unique divergence from fiat currencies, reinforcing its role as a non-traditional asset during volatility. By analyzing correlations and BTC’s reaction to currency moves, traders can better anticipate opportunities in USD-denominated markets and identify divergence points that signal market shifts. When charting futures, the data provided could be delayed. Traders working with the ticker symbols discussed in this idea may prefer to use CME Group real-time data plan on TradingView: http://www.tradingview.com/cme/ - This consideration is particularly important for shorter-term traders, whereas it may be less critical for those focused on longer-term trading strategies. General Disclaimer: The trade ideas presented herein are solely for illustrative purposes forming a part of a case study intended to demonstrate key principles in risk management within the context of the specific market scenarios discussed. These ideas are not to be interpreted as investment recommendations or financial advice. They do not endorse or promote any specific trading strategies, financial products, or services. The information provided is based on data believed to be reliable; however, its accuracy or completeness cannot be guaranteed. Trading in financial markets involves risks, including the potential loss of principal. Each individual should conduct their own research and consult with professional financial advisors before making any investment decisions. The author or publisher of this content bears no responsibility for any actions taken based on the information provided or for any resultant financial or other losses.
Greetings Everyone, Wishing you all a prosperous and joyful season! I wanted to share a quick analysis update regarding Chainlink (LINK). The chart is showing some exciting developments that align with classic technical patterns, which might hint at further bullish potential. ? Chainlink’s Recent Breakout: Key Highlights 1. Cup-and-Handle / Base Breakout Chainlink has recently broken out of a textbook cup-and-handle accumulation base. This pattern typically signals a bullish continuation, especially when combined with strong volume. 2. Massive Volume Confirmation The breakout came with two of the largest volume candles in over a significant time period . Volume validated this bullish breakout, as it confirms strong participation from buyers and suggests further upward momentum. 3. EMA Support and Dip-Buying Opportunities • As long as the price holds above the critical label (4) level, any pullbacks to the Exponential Moving Average 9,21 (EMA) should be seen as buying opportunities. Any break below EMAS with strong rejection should be sold immediately. 4. Massive spike on the DMI (directional movement index) indicator confirms buying pressure. 5. Projected Price targets using Fibonacci Further Research Material: Will be supplementing post with other resources to help you to make a better trading decision. Please check link: https://www.dropbox.com/scl/fo/pxajrgwzqexlr8iqy3kvr/AAqdvfVdpqu-6AJIGIH3Xvw?rlkey=dc2l7686tzda7vjpw3risefgw&st=9a68i40v&dl=0 Quick Recap: •Price above label (4) = bullish continuation. •Controlled Dips to the EMA = Buying Opportunity •Sustained volume = confidence in further price movement. • Strong Rejection Below EMAS= No support for current pricing. Sell signal. Closing Thoughts: Look out for entering during a “cool off period” aka accumulation phases. Best, clemard
After a 3-year decline, CRYPTOCAP:ALGO price managed to “grow back” a bit) Now, buyers of OKX:ALGOUSDT need to keep the price above $0.275-0.32 if they want to continue growing. If this condition will meets, then it will be possible to aim for $1.25-1.35 per #Algorand token _____________________ Did you like our analysis? Leave a comment, like, and follow to get more
After Bitcoin touches All Time Highs once again, I believe there may be a bit of a. correction. Profit taking sometimes occurs when this happens. Technicals are also pointing towards a slight drop in price. If all of my rules are still passed at 9am UK time, I will be shorting BTC/USD. SL - 105421 TP - 104717
XRP is currently navigating a key level near $2.45, with market participants closely observing its behavior around this region. The price action suggests a moment of consolidation, which could serve as a launchpad for the next decisive move. A potential rejection around $2.45, followed by a bounce from $2.40 or higher, would indicate that bulls remain active, potentially driving the price toward $2.59 and then targeting $2.82. Such a scenario would confirm bullish sentiment and open up opportunities for further gains (Green Projections) Conversely, a failure to sustain above $2.40 could expose the market to downside risks with slow down of the momentum, with $2.19 acting as the next significant intraday support. A break below this level may accelerate bearish momentum, pushing the price toward $1.82 (Red Projection). Traders should remain vigilant and consider multiple scenarios as XRP approaches these critical levels. Whether it continues its upward journey or faces a corrective pullback, the next moves are likely to define its medium-term trajectory.
#HNT is showing strength and has broken above local resistance
This week is a new week, so let's start this week's trading with hope! Gold rebounded after touching 2643, and currently rebounded to 2658. From the current rebound strength, gold is still very weak. And after gold just experienced a big drop, there is no position to support gold to rebound immediately. So we can only follow the weak trend in trading at present. So in the short term, I still prefer to short gold, and there is resistance in the 2660-2670 area above. Once gold cannot break through this area strongly, gold is likely to continue to fall. Once gold encounters resistance and falls back, it may fall back to the 2645-2640 area, or even the 2630 area. Bros, let's try to short gold first, and then wait patiently for gold to fall back! If you want to learn more detailed trading ideas and get more trading signals, you can choose to join the channel at the bottom of the article to make trading no longer difficult and make making money a pleasure!
What is this blog about? The blog is dedicated to intraday trading on the US stock market (NYSE, NASDAQ exchanges). After each trading session, I choose the most interesting and understandable stock in terms of making a profit and do a detailed analysis of it, indicating the prerequisites for opening a position, entry and exit points. The analysis is conducted in accordance with the applied trading system, which is based on the price reaction to horizontal levels (rebound, breakout, false breakout) and volumes. I do not use indicators. Each analysis is accompanied by a screenshot of the trade. There is a daily (and in some cases, hourly) chart in the upper part, which is used to analyze the overall picture and draw daily levels. There is a minute (in some cases, two-minute) chart in the lower part, which is used for intraday analysis, drawing intraday levels, entering and exiting a position. What is the practical benefit of trade analyses? Broad visual experience is one of the key components of successful trading on financial markets, in addition to the trading system, psychology and risk management. Normally traders spend thousands of hours looking at charts before it starts to bring positive results. However, simply looking at the chart is not enough. We need to understand what exactly we are looking for there and what situations allow us to make a profit with a higher probability. Analysis of trades helps to solve one of the main problems of beginner traders - lack of visual experience, and for experienced traders this is an opportunity to add/correct their trading system with new trading scenarios. How to select stocks for trading? It is important to select the right stocks every day that have the potential to make a profit with a high probability, in order to be successful in intraday trading. Main criteria for selection: 1. High liquidity (trading volume from 1,000,000 units and above) 2. High activity in the premarket 3. Pure directional movement 4. The stock movement does not repeat the market movement 5. "Respect" for levels both in the premarket and in the main session 6. The presence of a catalyst for movement (news, earnings, technical etc.) These criteria are perfectly suited to the so-called Stocks In Play, which make significant non-standard movements within one trading session, which often exceed the standard price movement (ATR) several times, influenced by a strong catalyst background.
SHARDA CROPCHEM LTD on the Daily basis is forming a triangle. Looking at the volume past few weeks, it looks like break out is inevitable to me. Plan: With a Stop loss of below 780 on Daily closing basis, expecting targets 870, 900 and 950. Will revisit once those targets are hit.
FX:EURUSD bounced off a support level, influenced by a day of significant news regarding the Euro. Overall, the market is in a consolidation phase as we approach the end of the year. It appears likely that the market will remain within last week's trading range. However, if we see a rejection signal at the support level and the downward trendline, we could expect a potential upward movement. This would suggest that the market may oscillate between the highs and lows of the consolidation zone. I anticipate the market will rise since the price has broken out of the falling wedge pattern. My goal is resistance zone around 1.05620 Traders, if you liked this idea or if you have your own opinion about it, write in the comments. I will be glad ??