Inter-Market Relationships & Forex Pairs
Good Morning,
Bernanke is on the hill again. QE seems to be coming and equities are at resistance. Still more fundamental data coming from the economic calendar so stay abreast of those releases.
Technically, SPX quickly arrived at its resistance level. Will it break out and then test the 1420 level?
Past performance is not indicative of future results
And here come the inter-market relationships. Check out the GBP/USD on a daily chart. Also at resistance:
Past performance is not indicative of future results
You can see the similarities between the higher lows in the SPX and the higher lows in the GBP/USD on a 1 hour chart:
Past performance is not indicative of future results
So, if the SPX breaks out, will that be a strong enough move to get the GBP above resistance? Which currency will be the "shining star"? Fundamentally, the GBP and USD seem to be on pretty fair terms, but there are no guarantees that the equity move up gets the GBP to move up due to its relationship to the EUR region.
One last equity chart. I still think USO is in no man's land, but if oil prices get dragged up to the mid 90's and USO reaches a DOUBLE FALL LINE TRADING area, could oil prices and USO be overbought?
Past performance is not indicative of future results
Join me for the IBFX Moving Average Webinar next week.
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.
