Good Afternoon,
Please help in dancing and praying for snow and supplying the "storm that saves Christmas". We could use some fresh powder in Utah and for that matter across the globe!!
The markets reacted negativel to the Fedspeak that came out about an hour and a half ago. For the first time in a long time, the markets reacted how they should to a weaker than expected Federal Reserve statement.
Two things of importance:
1. "unemployment rate will decline only gradually toward levels that the Committee judges to be consistent with its dual mandate"
2. "extend the average maturity of its holdings"
So more stimulus and a very, very slow recovery in the US. The markets today were only about 650 points from there 2009-2011 bull run. The fed has been stimulating our economy (and other Central Banks stimulating their respective economies) for almost 3 full years. If the equity markets are going higher, it is because the "novelty" of stimulus hasn't warn off. I don't know if it has or not, but it seems to be losing its luster. The markets may go higher, but I sure am glad I know how to implement protection as I am more than willing to be "behind the eight ball" in a bull market and sleep very well at night if we go sideways or GASP...down. And when I say sideways and/'or GASP....down, I don't mean for a few days, I mean for years, more like a decade.
Technically, and not sure what "technically" means other than not trading in poor locations which basically is the difference between a profitable trader and a losing trader. Technically speaking, the 1250 line has been "congestion" and acting as support and resistance. We could be above it tomorrow, but seriously, the hurdles seem to be more real and even if we get above it, how high can we go? Looking at the charts, 1350 is a realistic multi-year high. To the downside, 1150 is a realistic "support" or maybe more like a "pause".
I am keeping my powder dry, trading small and infrequently (it is December) and constantly playing defense. I will look to buy certain sectors and stocks as we (if we) get technically and fundamentally oversold and I don't see "value" at current levels. Basically what I am saying is the range is big and I am patiently waiting for what I deem better locations.
Intraday, we did get one AUD/USD BUFFALO BOUNCE that failed and we basically got one in the GBP/USD and almost got one in the EUR/USD which looked really, really tasty!!
Inter-market relationships are in play: weak equities, strong USD. 3 days until options expiration and my money management is telling me to move stops to protect recent gains.
Looking forward to seeing you on the webinar tomorrow evening.
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