1. System 3 report is issued every evening, Sunday to Thursday, after the System 1 Evening Signal report.

2. The System 3 report will look similar to the example below, however the actual FX Pairs detailed by the report may vary. The content of this report is that of general ranges, support & resistance levels. The relative strength, present in System 1 is also included.

Above is the Range and pivot report generated on Sunday evening the 31st May 2009. Below we will give a brief description of each data type and how it could be utilised.

• FX PAIR

  The FX PAIR column details each of the FX Pairs for which data is provided.

• OPEN

  This is the daily Open price and is for reference only.

• PREDICTED NEXT DAY MAX. HIGH, LOW & RANGE

  This is a forecast of next day max. high/low & range. This can be utilised together with the strength to gauge retracement and other daily price movement when placing trades. e.g. Be careful when placing a Long trade when the price is close to the top of the Daily range and vices versa.

• RESISTANCE & SUPPORT LEVELS

  These levels remain static for one week and represent levels at which there could be technical support or resistance. Monitoring these you can see where retracement or sometimes price reversal may occur. Each evening we highlighted the levels which fall within the next day predicted daily range for each pair.

   

  Resistance is highlighted Red and Support Green.

  Trading these levels can be very effective, for short trades in the region of 30 to 60 pips, depending on the FX pair and the Relative Strength.

   

  You can place a limit order at or around the level indicated to go Long trading the Support levels, or Short trading the Resistance levels. Trade risk should be approximately equal to your target reward.

   

  For example:

  • The report above was issued on the evening of Thursday 21st May.

  • Resistance is highlighter in Red at 1.5232

  • We decide to trade this with a target profit of 40 pips.

  • We place a Short Limit entry order at 1.5230, with a corresponding Stop at 1.5270, and Profit at 1.5190

  • The trade would have triggered at approx. 07:00 GMT on Friday 22nd May

  • The market bounced lower off this level and hit the Profit target at approx. 08:45 GMT.

Notes:

1. The trade entry orders do not always get triggered but this strategy usually has a good success rate if the profit/loss levels are set correctly without being too greedy.

2. The Level 1 Support & Resistance levels can 'flip' into Resistance and Support once the price is trading well between Level 1 and Level 2.

3. Caution during strong trends and major news announcements that can blast the price through these levels.

 

• RELATIVE STRENGTH

  The STRENGTH details the relative strength of the FX Pair. Positive represents that the overall cross currency strength is greater than that of its counter currency, Negative represents the opposite.