Here we are with day two of Aaron’s week and he’s facing a battle between the tech and the fundamentals. Good luck with that one
You can catch yesterday’s episode here.
A battle many traders face
Hi guys! Hope everyone is doing good!
Not much changes to the markets compared to last Friday close, except for EUR being under pressure after baby Mario talk on over the weekend.
I suppose this might really put some serious cap to the EUR Strength as the ECB might start to shift to FX Rate targeting if things worsen -> FX rate keep rising and directly affecting the imported inflation figures in the EU.
Decent Retail sales figures have improved risk sentiment, giving some strength to the USD so far. Have gotten some immediate pressure off the USDJPY pair.
Ok ok ok let me try to move to techs and see what I can get out of the markets.
Following up on the USDJPY discussion on my previous post.
Daily chart for S&P500 rolling futures
An update on equities after the recovery yesterday. The focus turn us back to the top side at around the 1835 – 1840 area. That is the 38.2% fibo level from Feb 2014 lows to Apr 2014 highs. It also coincides with the previous range support level of 1840. Support turns resistance now. Double the power, double the resistance. So if S&P500 can regain the 1840 level and close above, immediate bearish momentum would be eliminated and uptrend is likely to resume.
Nikkei225 have also bounced back into the neckline today.
USDJPY is still stuck under the 102 figure for now. Stops are surely building above 102 – 102.2 area.
All dependant on how risk moves now for equity indices and the USD.
Other possible risk factors in the near term would also be the US CPI tonight. Given the higher PPI we had last Friday, I suppose a lot of focus is on this. USD could spike on any higher figures.
If we put techs aside, selling the EURUSD Pair on a stronger CPI Number seem like a safe bet given the EUR Story as mentioned in the first paragraph above, with the likelihood for earlier Fed rate hike in 2015.
Ok I know I am contradicting myself as I am commenting more on fundamental than technical now hahahahah. Discussing on fundamentals is surely a lot more fun than the techs alone. But please I need to tell myself to just trust the techs alone, as I have to admit that I have got bad trade entries and exits for not trusting the techs and instead looking at other fundamental areas of the trade and telling myself Aaron is correct. (Proven Wrong Always)
I am such an emotional person right? Hahahahahha
Thanks for the comments yesterday! Have read them and I agree with the views of other traders. But of course as mentioned only the trader named “The Market” is right and we should use the tools suitable for us to follow him as closely.
Good Luck to all fellow traders and I will be back tomorrow to update on the USDJPY pair. J
(Secretly hoping it won’t break 102 and go test the 101.30 levels again) Evil Grin to usdjpy bulls! J
