SPX - Nothing Has Changed...

Good Afternoon,

What has changed lately? A lot or a little?

Fundamentally, very little when it comes to the US economic calendar. Jobs data in the form of weekly claims are leveling off and some may even say "improving".

Fundamentally, a LOT given international intervention, austerity, easing, etc... whatever you want to call it is fine by me.

Trading and investing wise - a lot! You have to be on your game to trade these markets as things can change in a hurry! Playing the ranges are working, except for when there are news bombs. When you are trading leveraged products, these news bombs can affect the markets in a big way and as you know, you don't need a big move to take you out if you are over-leverarging your positions. That is all I will say about trading psychology today - I promise!

Let's just talk about the big picture for a moment. The "professional" money managers think there is a lot of cash on the sidelines. Companies ARE making money. Earnings are GOOD! The markets are "undervalued" and at good "ratios" as most analysts are saying. So, if everything goes as planned overseas, we should see a breakout to the upside. I said it months ago though, I think by the time we get towards the 1300-1350 level, we will see sellers come into play. After that, I think we will be further downt the road with economic data and will be able to see if that is a great level to play the short side. In between 1200ish and the 1300 level could come quickly, so I am not sure how I will play it - I will decide as we rally.

BUT, do I think we SHOULD be rallying up there? NO. Will we? Chances are we will as the markets are reacting to government intervention, not reality. 

Fun stuff!!

Technically, very little. The markets are sideways - for months and for the week. Here is just one of many examples, the EUR/USD:

Past performance is not indicative of future results

For some intraday trades (and there were lots), here is the DOUBLE FALL LINE on the AUD/USD:

Past performance is not indicative of future results

And a short term DOUBLE TOP on the GBP/USD:

Past performance is not indicative of future results

Remember, I am a buyer of the dollar in good locations as a hedge, not necessarily as a money making trade. If it works, great!

These are trying markets, trade according to your situation!!

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.

SPX - Same Exact Spot as 3 Days Ago

Good Morning,

I am not posting any charts, just a quick commentary on a couple of things. Before I get to those things lets discuss fundamentals.

1. Gov't intervention (or rumor thereof) is a daily occurence and has to affect your trading size and trading length and how you manage the trade

2. Earnings are still around daily and claims are coming tomorrow

3. Options expiration is Friday and typically options expiration weeks are up weeks in equities

Technically speaking, the reason I am not posting charts is we are exactly in the same place right now as we were on Monday at the open. Look at your USD currency pairs and the SPX. A lot of chop, some intervention, some intervention rumors and there you have it, SPX is still on its highs.

I don't know what will keep it from breaking out to the upside, I just hope it doesn't happen until Monday...

Overall, I am quite happy with the equities heading towards their earlier year highs. I think it just provides a big trading range and the government intervention just delays the onset of years of stagnant equities (zero growth) and stagnant price pressures. Read: stagflation. I have been calling for this for 2.5 years now and the only reason equities are on their highs is the "can being kicked down the road" intervention/easing is still in play. I do expect unemployment to stay elevated or rise. I do expect traders and investors who pick their spots to do better than the long term investor. 

My big hope that governments stop interfering. Think about it. Has the Fed stuck to its mandate of:

1. creating jobs

2. controlling inflation

Intervention in any industry changes the playing field and traders, if you haven't realized it yet, you better now. Pick your locations and trade with a plan on each and every trade.

Park City/SLC Trading and Investing Club meets 10/20 at 7pm

Happy Trading!

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.

SPX Resistance - Still Apparent!

Good Morning,

We have a packed week of data. Earnings, Bernanke, inflation (blah!), and claims.

Technically, we ended last week with a BUFFALO BOUNCE and began this week with a BUFFALO BOUNCE  in the EUR/USD:

Past performance is not indicative of future results

Regarding equities, we still have resistance in tact. I can't stress enough about waiting until resistance or support is approached before entering your trades. The risk to reward is at a very good level and if the resistance or support is broken, you have stops in place and money proper trade management in place. It is always nice to hide behindthose levels!

Here is the chart of SPX with resistance holding in:

Past performance is not indicative of future results

Park City and Salt Lake City Trading/Investing Clubs meet Thursday!

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 aff

SPX Resistance Holds!

Good Morning,

Nice to see SPX resistance holding in at the 1220-1224ish range. No pressure to trade as the monthly protection looks a lot better today than it did yesterday at 2:30pm Eastern. We are still well within striking distance of highs and we have retail sales tomorrow. I imagine they will be good as people are still spending, but since the survery period was during the market "crash" last month, maybe some of the shine will be off just enough to prevent us from a stupid and unwarranted Friday rally. The only people that want to go into the weekend long at these elevated levels are the ones hoping for a weekend resolution. So yes, I will be looking to sell rallies tomorrow and one way of doing that will be to buy the dollar.  

Today, buying the dollar worked in GBP/USD as we had a triple top. It was a fairly rangebound day, so playing the edges of the ranges, believing they would hold worked pretty well. See the chart below:

Past performance is not indicative of future results

I will try to provide a weekly wrap up tomorrow depending on activity. Watch out for earnings over the next few weeks and get ready to manage your October options as expiration is next Friday.

Last night's webinar should be posted soon to this page where you can review recent ones.

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.

SPX - Can't Go Down...

Good Morning,
When you have a large rally and then you can't sell off, that is a good sign for the bulls. Think about it, if we were fairly valued down below and now we are 3% higher after yesterday's move and sellers don't come into the markets, does that mean that sellers are on the ropes and buyers know that?

If you have a big move up followed by a small to no move down, look out above. Again, we have the 1200 level in SPX and then the famous 1220ish level. Here is the chart:

Past performance is not indicative of future results
So we have had a 12% move from 1080 to 1200, will we test the 1220 level? Economic data and international news has been "positive" and technically, it seems like we will at least test the top of the range.
Moving to forex, we had numerous opportunities today, even though it was overall a rangebound day. So it was a very technical trade where you could go against the moves and play the "edges of the ranges". First up, a support line where a big move down came to rest and moved back to the upside in the GBP/USD:

Past performance is not indicative of future results
Next, a DOUBLE FALL LINE TRADE in the EUR/USD and the USD/CHF:

Past performance is not indicative of future results

Past performance is not indicative of future results
Let's see what happens tomorrow as we are light on the data front and based on past performance, the equity markets like to go up when there isn't any data to block its path.
Free Webinar Tomorrow Night - click here for link

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.

SPX Moving Into Really Overbought Territory?

Good Afternoon,
Fundamentally, earnings begin and we have claims as well as retail sales later in the week.

Technically, we still have quite the range in SPX and I think that before we get to the tops at 1220, we may see some selling come in at the 1200 range - but a lot of that depends on the Europe "Bail/Fail Trade". Bail we go up, fail we go down.


Past performance is not indicative of future results
Next up, we have the forex charts. Was the selling of the dollar last Friday a hint that we were going to explode up today? There were two opportunities for BUFFALO BOUNCES today. One in the NZD/USD and a second in the EUR/USD, but because of the relentless action to the upside in equities, the dollar stayed weak.

Past performance is not indicative of future results

Past performance is not indicative of future results
I really am enjoying the markets rallying, but could now use a little sideways action for the remainder of the week. With 9 trading days until option expiration, getting through to Monday at these levels would provide some nice time decay!
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.

SPX Heading Towards Overbought?

Good Morning,
I am pretty glad to see the SPX heading into overbought territory again and if we get a good jobs number tomorrow, hopefully we get an early pop before profit takers and short sellers come in ahead of the weekend. There you have it, my trading plan for tomorrow. And to throw in the ever-important "inter-market relationships", if the USD weakens further, I would like to buy it at a discounted price. IF these inter-markets relationships work.

That is another point! Every day is different. I have been saying this over and over!  Today both the GBP and EUR initiated more QE. I have a feeling the markets are going to be fun for many, many years as QE gets extended.
Forget QE causing inflation, it may cause stagflation. I called stagflation in July of 2009 and I am sticking to it - the beginning of it has just been extended due to QE 1 (TARP) and QE 2.
To the charts we go and let's start with the SPY. Come on 1170ish, as I am ready to throw on some more October protection! The first chart is the 3 month so you can see support and resistance and anyone who puked or shorted at the bottom is not feeling so good. And if there are some more shorts out there, hopefully they puke on a good employment number tomorrow and that get's me to the second chart - using Fibonacci's to set protection at "the line of death":

Past performance is not indicative of future results

Past performance is not indicative of future results
To forex and I jumped the gun today. There was one good trade - sellilng the weaker GBP/USD when the stronger EUR/USD stopped rallying. I just got a little focused on the EUR/USD and jumped early - didn't get hurt, just didn't get anywhere. But love the DOUBLE FALL LINE TRADE on the GBP/USD. Both charts starting with the EUR (arrgghh!!):

Past performance is not indicative of future results

Past performance is not indicative of future results
I may update after the jobs number tomorrow. If not, have a great weekend!

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.