Monday, July 11, 2011

Market Update July 11

It is 2 am EDT in US, but markets are open in Asia and getting ready to open in Europe. Traders trade forex 24 hrs and futures almost 24 hrs around the clock. This is one of the biggest benefits of this profession - there is something to trade at almost any time. Should one spend 24 hrs around the clock at their screens? NO. But if you are able to do this 10-12 hrs a day, you can make a comfortable living. Please forget about getting rich quick, the only thing in this profession to do quick is to blow your account.

Euro: shoot first, ask questions later. Traders are selling euro across the board, all euro pairs are down. There is a rumor that emergency meeting scheduled for today will discuss Greek default. Bummer!!! Can someone please tell us something we did not know? I would be more concerned about Italy here. Absolutely no bailout can be done there. Italy defaults - world is going to hell in a handbasket for a few months. We are way too early in Italy yet, but traders will get ready in advance.
EUR/USD Technicals: there is a gap. When price opens below/above prior closing day and moves away further, it is considered a gap. Forex traders like gaps because they usually get filled, if not in the same session, soon after in few days. OK, we are at 1.4200 as I type, lower trendline of daily triangle is @ 1.4160. There is going to be a stop hunt there and possible reversal. Be ready... That said, after that support Euro could be heading for a lower daily BB @ 1.4120 and possibly 1.4102 6/27 low. Stop hunt can be 20-40 pips of very violent quick action. If you blink - you missed... Below we have another support @ 1.4072 6/16 low,  and after that 5/23 low and 200 dema laminate @ 1.3970... At that point we will be way below the daily triangle's lower trendline and will be considered a breakdown. 1.3912 would be a good target to trade against in that scenario, which is 200 dsma. Shorts are all over the euro here. I would short @ gap fill or 10-15 pips below, if not short already. Do not chase... Stops will be placed above 1.4285 and 1.4369...

Oil: breaking down or just a pullback?? Not enough info to decide yet. Just pierced 95.70 as I type. If this area goes we are gonna fall to 94.55 and possibly 93.40 quick. Above the resistance is @ 96.70 and 97.10 Risk off is definitely here, all commodities except gold are under pressure.

Speaking of Gold: precious is trucking with almost no pullbacks (as predicted by yours truly). Absolutely no reason to think it does not try to have a run at highs. 1559 is DR2 and 1580 is WR2. Lets see what happens...

SPX futures: pulled back to 8 dema, surprise surprise. Buyers are lining up, but should the news get worse overnight, it is no sure trade. YL @ 1329.25 to be watched, I am not saying for a breach of a tick or two,  but we take it down below for 5-6 points, shorts will pile on and a trip to 21 dema @ 1313 is in order then, WS2 is there as well... On the way up we got WP @ 1341 as a resistance, and last week high after that @ 1354.50...
Earnings season is here, AA opens the gates tomorrow...

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