Fundamentally, earnings, corporate issuance, international news, interest rate policies, and economic data has been positive. We get some more fundamental data tomorrow with the potential for international headlines (as always), but more specifically, Bernanke is speaking (not positive it will be market moving). Then on Thursday we have claims. That is the bulk of it for the week, so as I said yesterday, whent there is little economic data and no bad news out of Europe, we move up.
Technically, we were up yesterday and closed on our highs today. We are very, very close to the recent highest high of 1285ish.
Technically, there are fun patterns shaping up. First in forex, look at the ascending triangle in the GBP/USD:
Past performance is not indicative of future results
As you know, when equities move to the upside, the dollar moves to the downside. Which one is leading which? I am not sure, but if equities rally further, you would expect the dollar to lose this support line that it has been using.
Moving to equities, let's look at the SPX, which is above the "line of death".
Past performance is not indicative of future results
This means that the downmove has basically been totally retraced and all that is left are old highs. Will it be a tug of war at 1285 or will we go through it with ease. Either way, you would expect it to be tested/broken the way we have been moving as of late. If traders don't step in now, where will they become bearish again? Seems to be much higher than where we are at now, say 1300 and above. I am still sticking to my guns that by the time we do get to 1340/50, we will have exhausted ourselves and that could be a multi-year high.
Moving to one of my favorite sectors, commodities. We have USO. If it heads towards old resistance which matches up with 100+ per barrell of oil, I may choose to use that area to protect the portfolio.
Past performance is not indicative of future results
If you have been long this sector - which gave us a very fundamentally oversold situation a month back, you should be locking in profits or slowly taking some gains.
Free IBFX/JPF webinar tomorrow evening: https://www1.gotomeeting.com/register/717515353
Happy Trading and Be Environmentally 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.
No comments:
Post a Comment