Non Farm Wrapup: Forex Pair Breakdown
Good Morning,
We should be down about a thousand points in the equity markets between the last few months of economic data combined with an equity market that seemingly only goes up when the Federal Reserve bails us out.
But alas, we are probably ready for another bid to catch and the equity markets to go up and volatility to go back down. Pretty crazy isn't it? Actually it isn't. It is actually just plain sad that reality is hitting hard in the employment picture all over the world and the markets are taking it in stride. Well, when reality does set in, real craziness will set in as well. So for you traders out there who were hoping that this report was going to take the EUR/USD out of its range, sorry, but we are still well within our range:
Past performance is not indicative of future results
Overall forex pair ranges are well within their average trading ranges and Buffalo Bounce trades could be in the mix if equities do in fact catch a bid. Since it is Friday, I have a hard time believing they will, so using Fibonacci's to find reasonable retracements to buy the USD may be the play:
Past performance is not indicative of future results
Moving into equities, check out the SPX and its Fibonacci of the recent move off its lows. We are creeping back towards the low of 1360 and the area that I have been talking about for a while, the 1350 area:
Past performance is not indicative of future results
And now the longer term SPX chart with that 1350 level and lower levels of possible support highligted by Fibonacci Retracements:
My patience is kicking in and telling me not to jump at opportunities today as far as buying equities, but to wait to see what happens next week. We have elections in France this week, we have the unemployment data to sort out. By that I mean that usually big misses in unemployment can send a market in a trend for days. The only thing stopping us from trending down off of bad jobs data (2 months in a row) is the Fed. We also have Bernanke, claims, Greece elections, interest rate announcements.
One ETF (and commodity) that is getting closer to an attractive level based on fundamentals and technicals is oil (US):
Past performance is not indicative of future results
So much to digest so make sure you use trading plans as volatility could possibly lead to larger trading ranges with faster moves. Plan your trade and trade your plan.
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.
