The U.S. Session Trader's Daily Forex Question
The U.S. session, trader's daily 09:45 EDT question; "Oh dear, do we now want to take a U.S. based trade and run the risk of a price move stranding things with no momentum, as 80% of U.S. sessions do?"
The law of probability says that U.S. trade will not follow through with sustainable breaks on new positions, and with what came before the Wall Street open, we already have seen that the bullish S&P start could literally go anywhere. TheLFB equity tracking system shows that the main components that we use to gauge S&P momentum has only four out of thirty companies trading in the green.
If this move is to hold, and by default the Usd is to get weaker, a huge raft of volume needs to hit that lifts all stock indices, as well as oil and gold trade. Not to say that could not happen, but it is questionable as to whether it will hit and hold before the European markets go into their close at 10:30 EDT.
The fact that gold moved $10, or 1% in five minutes at the open, and the S&P managed to tag on 0.3%, leaves another question as to why oil has not moved too far, and further enforces the feeling that the Wednesday move could hold. The majors are so far from their previous session highs or lows, that actually breaking new ground and holding for a ride on the dollar is very unlikely; unless a volume tsunami hits.
There is nothing at all clear-cut about the picture we have on the major pairs, and the global market Usd drivers. All are overbought in the near-term, and the major pairs are all dealing with daily chart Simple Moving Average areas that really are creating massive support and resistance areas to work through.
Volume and speculative interest is very light, creating an environment that offers plenty of volatility, but also failed breaks, in the same measure. Global equity trade is flat, and commodity markets are also flat-lining after efforts to hold support this week. In all, not an easy environment to issue high probability signals.
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