I was writing this commentary earlier and wasn't going to post any charts. After a few sessions with clients, a few charts came up as well as a DUH! pattern in forex. Too bad I was in the forex trade and was too close to the forest to see the trees and should have done better with it!
Let's start with the fundamentals. Just another bad batch of economic news causing the SPX to rally. Fundamentally, we have a hotter than expected CPI (woot! woot!, yes, I just purchased a Living Social deal). Claims were higher than my expectations and more importantly, higher than analyst expectations. Philly Fed was dismal to say the least and not to mention the Empire State Index was below expectations. Maybe they should add some economic data to tomorrow's empty slate and if it comes in below expectations, we bust out of the range to the upside.
Technically, you know the story. SPX is back at the 120/124 area of resistance. It isn't clear which price point to use so I will say "this area has been an area of resistance".
Before I get to the pattern in forex, there is a very cool pattern that may be exhausting itself in INTC. Could the double bottom be completed? Remember to check earnings!
Past performance is not indicative of future results
Here is the "DUH" head and shoulders pattern in GBP/USD. Look at it on a longer term chart to see the run up today due to the intervention and then see how this pattern reversed that uptrend.
Past performance is not indicative of future results
So, what will the driving news factor be tomorrow. As I mentioned, a relatively empty economic calendar in the US. Will it be earnings, will it be oversea announcements, will it be a domestic issue?
I sure am hoping to see SPX get to 1224 and see what happens at that level. It would be hard not to get into October prtection at that level since you are looking at an 80 point move from support to resistance.
Happy Trading and Be Enironmentally Cool
Coach Brian
Forex trading is one of the riskiest forms of investment available in the financial markets and suitable for sophisticated individuals and institutions. The possibility exists that you could sustain a substantial loss of funds and therefore you should not invest money that you cannot afford to lose.
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