Equity Rally: Technicals and Fundamentals Warned Us!Brian Kahn - Thursday, September 6th, 2012
Anyone surprised by the equity rally? I hope not! We know from our technical analysis that the buyers have been in control. We also know that no matter what fundamental piece of data came out - whether it was good or bad, could not make the markets go down - only up and sideways.
We had some more fundamental data today. ECB - they delivered. ADP (a non-government number), was better than expected. Claims, better than expected. ISM Services - better than expected. The employment component rose too.
Back to technicals - we had a breakout in the SPX - next resistance is about 1440, then a psychological barrier of 1450, then 1480-1500. 1500! I need to print that one more time. 1500! Keep an eye though on AAPL which is at resistance. Why didn't it go through its high? What about USO - oil stayed sideways. I kind of hoped it would hit the 100.00/bbl mark and see if selling pressure comes in, but for now, selling pressure is closer to the current price of 94-96/bbl.
Speaking of oil, the USD/CAD got clobbered as USD got close to .9800. Hard to keep bids in there as equities may drag oil with it even though .9800 has been support in the past.
And finally, the AUD/USD. The AUD was on hard times and found old support around 1.0150 before taking off on today's news. Today's news was so good that we had our first BUFFALO BOUNCE in weeks!
Past performance is not indicative of future results
Unemployment report tomorrow. Will bad news be good for equities? Will good news be good for equities? For all of you Chi-towner's: "Streetwise, get YOUR Streetwise!"
Finally, the one thing that could be a "sure bet" is that with equities going up, should remain low, meaning trading ranges should be on the smaller side. Count on volatility being "kicked down the road".
Happy Trading and Be Environmentally Cool
Forex trading is one of the riskiest forms of investment available in the financial markets and suitable for sophisticated individuals and institutions. The possibility exists that you could sustain a substantial loss of funds and therefore you should not invest money that you cannot afford to lose.
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Educational purposes only - no buy, hold or sell recommendations.
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