Before I get into today's analysis, today is a "two fer" as I will be leading a webinar on placing orders within Interbank FX's MetaTrader 4 Tradig Platform. Here is the link.
For the analysis, I will begin with this: the markets could go down a 1000 more points and still be "overvalued". Do I think that is going to happen? Probably not, at least not right away. Do I think this is a buying opportunity, hard to say. This is the first time since last summer that we have sold off without bids coming back in. I think prices are getting more attractive in certain sectors and certains stocks with good yields.
Just like yesterday, we have had lower volatility in forex during the American session as compared to US equities and options. The equity markets are seeing many intra-day swings, yet the forex markets are making a big European session move and then moving sideways.
We did see a nice 5 wave Elliott move in the EUR/USD and then a failure in the sequence and a double bottom:
Past performance is not indicative of future results.
Moving into equities, let's look at SPY:
The trendline I drew could move up or down depending on the trader, so I am not convinced that this is "support". Again, I am looking for good levels and I think there may be some more downward pressure to come, but we may be "approaching" good levels.
Here is the socially responsible play for the day - it filled the gap and is approaching the 200 exponential moving average (WFM):
See you on the webinar this evening and at Park City Trading and Investing Club Tomorrow night.
Happy Trading and Be Environmentally Cool
Coach Brian
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