To better understand what I am discussing here, please read my weekly trading notes...
Stock market has reached a zone of utter confusion and ludicrous ecstasy. I am starting to sound like a broken record, but at 13,000 on Dow there is no real resistance, it is all a hype, illusion, and total deception. To introduce yet another magnet of public money lure, Nasdaq touched 3,000 mark in the session, yet another useless milestone. If you want to use meaningful levels of resistance put a line through 13,137 on Dow and 3,029 on Nasdaq. I do not think we will get there though...
Gold had some faking to do here. It reacted negatively to the neckline of inverted head and shoulders. Precious never does what everyone wants, it illudes traders and then goes in the predominant direction. We should see it above $2K at some point, but it will not get there in a straight line. Let it rest and build the right shoulder some more...
Dollar is the main culprit of gold's sell-off today. Bernanke is testifying on The Hill, and it seems like his prepared statement made traders believe that QE3 is not a sure thing. I can't say I agree, but certainly do not mind the development...
This brings me to the last part - euro. Not only is it losing a little steam due to the dollar, but also it is reacting to LTRO. E529B was thrown out of the helicopter at cash-hungry almost-defunct institutions. They get to live another day... Perfect double top has developed on the hourly EUR/USD chart today. It is at neckline as I type - another opportunity to sell, even if you missed the quick whoosh lower. Do not blink this time...
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