Markets are like a pendulum. They keep swinging from one side to the other. The people who buy or sell at either extremes (in the opposite direction) will make money. The ones in the middle will be rogered.
SPX has rolled over from yearly highs at 1414 to 1355 and now is trading inside this band in a neat pattern notching lower highs. I have been laying down the important price points for SPX Emini futures which you need to super impose with what you see on the bond markets to gauge the trend for risk. Trends need to be understood for daily and hourly. We prefer trading hourly as and when we find trends in the same direction as the daily.
I have the daily dose of important Intermarket charts and then we move over to commodity charts, forex setups and finally to two macro key points from the US.
SPX futures are once again tugging at the volume hole at 1375 zone but this time from the bottom. The move from 1360 has been led by increasing buying pressure (strong green candles) which does make you question
the downtrend bias. The Line in Sand for SPX is 1371 for a test of 1375 and then it is all clear for 1385 levels and even have broken the downtrend. That is how close we are to breaking the downtrend.
110.45 is line in sand. It is holding till now. You know what to do. Go long with a stop at 110.44 and Go short at 110.44 for a target of 110.40 with a stop at 110.46. The buying pressure is off as Stochastic falls to 22 levels but is above 20.Watch for a break of 20.
While Schatz has ploughed down to its key 110.45 level the US treasury 2 year has rolled over below the 110.2 levels. It is holding the breakout at 110.16. The breakdown of that level will mean 110.12 which will mean time to go long USDJPY. It is as simple. The stochastic are above 80 levels on the daily. Therefore there is no doubt about the direction of the trend. The question is only whether it will move to test 110.16 which means it may be difficult to put your stops on USDJPY.
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- The April Live Trade Sheet
- The April Live Trade Room
- C3X Performance FX portfolio
- Key economic data and speaker list for this week can be found here:Economic calendar
- Key BRICs economic calendar can be found here: BRICS calendar
- The Bond auction schedule can be found here: Bond schedule