Dow Rejects Monthly Highs April 22, 2015
Market Moves Difficult To Explain These Days
In the new normal after the latest new normal any effort to explain why the markets move in such ways is more than likely a waste of time. Sure we can see when tape bombs get dropped and we get a sustained move then its pretty easy. However when the bad news is good, good news is bad, whose going to print next, who is stupid enough to raise interest rates, new normalities are factored in there is just about no well thought out purpose for just about any market move but a sell off when considering some of the things happening these days. Its best summed up in an article this morning and these are just a few factors that should be creating some risk aversion. However considering the central planners have always come to the rescue there isnt much reason to think they wont do it again until there comes a time where they cant.
Futures Surge On First Chinese State Bankruptcy, Greek Capital Controls And Approaching Default
Explaining the catalysts that move the “market” overnight has become so farcical it is practically an exercise in futility and absurdism.
In short: a relentless barrage of negative news from around the globe, and US equity futures ramped as high as 14 point overnight before trimming their gains to just 7 points as of this writing: perhaps there was some good news that hit and we are unaware of?
I would agree that sums it up pretty well. Now for the latest from Max Keiser. If there is light at the end of the tunnel then Max is there to help see it. In this episode they talk about the coming times of the power being able to be taken back by the people. Of course as usual it all starts with Bitcoin but that is just a beginning and has grown substantially. What I found interesting is that of all places, Mexico is standing out and may actually provide the example before the US people get a grip. Enjoy.
EUR/USD Pushes Back Up
I suppose with Greece potentially getting a Russian lifeline from the Russian pipeline they would have a little hope the Greeks wont be defaulting in the near future. However 5 billion is really only a drop in the bucket compared to what they face in loan payments for May. Its not over by a long shot.
Today I will be still bias for the short on this pair but more open to the long than I was yesterday. The best level for the short is up around yesterdays highs at 1.0767. Although the Asian highs will be valid I will need more price action backing the short unless they run the breakout traders to the lows first during London today. The best long is down at 1.0686 or lower at 1.0662. The daily level close to the current Asia lows is still valid but does carry much more risk for entry.
GBP/USD Weak Push Down Gets Rejected
At this point direction on the GBP/USD has been thrown out. Its not that the push has proven a failure as of yet but retracing the full move after hitting stops to the lows does not bode well for being bias for a short today. The best level to short will be at 1.4969 and the safer long from 1.4861. The 1.4920 is valid for a long as long as they hold above during Asia and run stops below the Asian lows during London but the added risk makes me want to see them hit breakout traders or see more than one trap there.
EUR/JPY Runs Stops to Lows Before Testing Highs
The move on the EUR/JPY yesterday does leave direction in doubt as well. Showing an intraday push up does suggest they have slightly more potential for a break to the upside but they will have to be that confident in the Euro strength to do so. Again the sfer entries will be at the extremes of 128.73 for a short and 127.55 for the long. However for those more aggressive the 128.15 is valid with the 200 just below. The Asian lows fall in the aggressive bin as well so in order for me to be taking the long from there I will need substantial trapping.
Forex News Today
The calendar only has the BOE Meeting Minutes today for London. This could be interesting if one or more changed the vote to hike rates and back up any of the recent jibberish. I have to admit it has slowed down so its less likely than say, a few weeks ago.
Later during NY there is US Existing Home Sales expected to rise. As usual a big positive miss may get them thinking rate hike and see some USD strength while if it disappoints and the USD has been weak most of the day there should be an extension of the move.
The Asian session traders have Chinese HSBC Mfg PMI expected flat but if recent events give any clue it has a better chance to disappoint.
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