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US tanking again

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Super Contributor
Yep, agreed. I'm watching the USD Index as it will pretty soon tell us whether we're going to see the next leg down. Check the Index daily chart. Take the high of 19 Nov 08 at 89.25 and draw a resistance line over the high of 19 Feb 09 at 88.57. Then the trend support line from the 18 Dec 08 low slopes up sharply and is today at 86.90 and will close with resistance within the next week. The resistance today is at 88.55 right on the 2X bollinger so it will probably hold for today. But, if you draw the channel resistance line on the current uptrend then you see the upper range of the channel at about 9140 for today, and that's scary. If this one breaks out then it's going to rally hard to at least 90 and with the jitters that the JPY is getting, it just might happen sooner than anyone expects
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Super Contributor
Things were looking cheap and I couldn't help myself. Hopefully today brings some relief were I can get out at break even.
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Super Contributor
be interesting to see what that US claims number does when the US opens. 667k with continueing claims above 5 bars for the first time ever. It's going to ratchet up risk aversion a few notches.
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Super Contributor
big, BIG disconnect, the carry is really dead. JPY getting trashed by the USD while the EUR is getting trashed by the JPY. The disconnect is that the EURUSD is pretty much sideways. Something has to give and methinks it will be the EUR. I'm long USD...for now
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Super Contributor
whoooowheee, the DOW TRAN is making new lows while the DJIA and SnP are happily flat to green, not good. And with the way the major crosses are behaving... methinks we will see the US close red and tomorrow a possible bloodbath because at some point either the USD or the EUR has to get an upper hand and right now the EUR hasn't much of a chance. So, the conumdrum, the USD wins but their markets are red... what happens with the FTSE which pretty much rules us?
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Super Contributor
Good call, looking red already. Tomorrow more US data. Either tomorrow will be down, or Mon will be black
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Super Contributor
I want to see a bloodbath... just that GDP number has to come on the right side of the coin
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Super Contributor
employment next week ... we know already will be a bad number
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Super Contributor
I think we're going to see some volatile swinging in a fairly tight range today until the Yanks come online. Lotsa indecision out there. The markets can't seem to decide whether to break up or down. Even though I'm a dyed in the wool bear I'm not too keen on another break down because there is very little support between here and oblivion and that's not good, even for bears. But I'm not real confident as the DOW TRAN has made a whole new low at 2531 and it's notoriously leading and probably the most ignored leading indicator of all. The only other ingredient needed now is for an upside break in the USD Index above 88.50 (currently 87.96) and the downhill slide starts. About the only good news is that the divergence between EURJPY and USDJPY has narrowed a bit and the EURUSD seems to be just ambling along in a 1.26 to 1.28 range. If the carries freak for any reason or if there's any further risk aversion then the USD is going to spike and equities will go down. Risk is downside IMHO
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Super Contributor
Hi Nova. This is definetly a tight call here. My guess is that the final leg down is very near, all the ingredients seem to complete the picture for the final stage of capitulation. Since everyone is waiting for this bounce at the moment, This could be the perfect timimg for the bears to put on their gear and get this over and done with so that they can go back into hibernation for the next 10 years. :)
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Super Contributor
Electrox, I think that's just the problem, I don't think the bears are showing any real interest. I know I'm not as I don't like what I'm seeing. Far too much complacency out there as if neither bulls nor bears are really making any effort. That sets the stage for a full blown delayed reaction stampede in any direction if any of the cooks out there fart at the wrong moment. It's just the VIX that has me perplexed.
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Not applicable
Nova, what do you think about the symmetrical triangle on the S&P 500? We broke down with good momentum to go and test the November lows, I think we'll see a little rally from here (return move to test the breakout and then down to form a new low? omo
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Super Contributor
Good grief, the USD Index is testing 88.50. If this resistance drops then it tests the high of 19 Nov 08 at 89.25 and if that goes, then the psycho 90 and if that goes then ... who knows, probably 100
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Super Contributor
Skippy, that triangle is also on the DOW and it's broken downside. The problem is again DOW TRAN as where transports go there the DOW usually follows. Granted, SnP is the big daddy but right now under 800 it is not healthy. And remember that in a bear market the oscillators just do not behave the same as in a bull. Oversold can stay oversold for a lot longer than you would ever believe. Rather pull back to daily, weekly and monthly charts and look for the primary trends and trust only that. It's what I do. In a bear I do look at my oscillators but I do not trust them. Greed (bull) is predictable but fear (bear) isn't. If the daily trend changes to up, then I'll change my mind and only then
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Super Contributor
Nova, Im currently using the Quote.com to analise the USD index. Problem is I cant draw trendline on their site. Do you know of a better site? also that has intrady data for this index. thx
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Super Contributor
I use eSignal but it's a subscription service. Try www.barchart.com as I've found them to be quite reliable. Look under Futures > Currencies for the USD Index futures. I find it's pretty accurate even though it's delayed (I think 15 minutes). Gives two forward contracts so you get a pretty good idea of where it's likely heading. Anyway, 88.50 tested and holding so we'll likely get a bounce but I'm sure as anything that it's going to assault that resistance again and soon
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Super Contributor
Thx. I'll check it out.
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Super Contributor
USD Index making second stab at 88.50 and if it breaks...
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