Markets did another choppy day as I expected and today (Thursday) is the day I expected the debt deal announced and this should be a sell off and sell the news event, and funny enough the euro got exact to my upside target premarket to 1.4$ - lets see if it gets rejected to there.
When I look at the USD/CAD it got all the way down to the "breakout" point which is now support zone at 1 and with this the USD should rip up higher from here with the euro plunging down.
I think that the debt deal will be a big disappointment for markets and there could come lots of critics on it over the near term now which would hurt the markets.
Everything in the debt plan has been "well known" and nothing new to the market - so after I see futures up , actually right now testing my TARGET to upside on dow jones near 12.000 or MA(200) at 11.966 - well right around here , then I think markets will slowly start to fade into US opening and possible if minor gap up - should be a SELL THE NEWS.
I expected today (Thursday) to be the day markets should start to begin the sell off - so lets see how we end today - I wont be bullish as long we hold below MA(200) on the dow jones and 12.000.
In case dow jones breaks ABOVE 12.000 yes , then I'm nervous and might take all my shorts off - but this will be the only place I would do that cause nothing is bullish as long we stay BELOW 12.000.
Both the dollar and the euro is in perfect setup with the euro falling down from resistance here and the dollar going up.
I think the chart I made speaks for themselves.
Conclusion: Remain Long EDZ - TZA - ERY swing trades and think today will be "sell the news" and start of the big plunge in markets over next week or so - there is just nothing to be bullish about before dow jones can break 12.000 - euro can break 1.4 (FXE) and the USD/CAD breaks below 0.98$ with confirmation to braek the 1$ level. So in case we gap up I would load as much shorts I can again - there is simply no reason to get long here.
Long TZA 33$'s EDZ 20$ and ERY low 14's all a bit underwater.
2 possible scenarios from Thursday in the US;
ReplyDelete1) Market keeps going up to 1300/1350 range as more people buy in,
or
2) Market goes down because people take huge profits right away.
Sucks to be underwater but hopefully your signals continue to confirm a downturn.