Analys från DailyFX

S&P 500 Tech Outlook: Consolidation Continues, a Move is Coming

Published

8 år ago

4 maj, 2017

DailyFX

What’s inside:

SP 500 continues to consolidate, triangle visible on the hourly time-frame
Break likely to the upside, but can’t rule out a downside break; going with the break
Keeping an eye on volatility should market move higher; rise in VIX with rising market could be a warning sign down the road

Not much has changed since we last looked at the SP 500 on Tuesday, the period of consolidation below the March 1 high continues. Yesterday, the FOMC caused a spat of volatility, but nothing like some other times we’ve seen in the past. The FOMC minutes released on April 5 for the March meeting caused more of a stir; a 28-handle daily range. Yesterday presented a ‘whopping’ 10 -handle range.

Volatility remains very low. The CBOE Volatility Index (VIX) recently hit its lowest levels since early 2007. A sign of complacency, but it doesn’t mean it can’t stay low for a while longer. If the market continues to push to new heights we’ll keep an eye on the VIX; should it start to rise with the market it could be a warning sign for longs down the road. Rising volatility (uncertainty) in a rising market often portends a period of turbulence (market down).

For a longer-term view on the SP 500, or another market of interest, see our quarterly forecast.

But we aren’t there yet, and looking at the near-term the recent consolidation is more likely than not to lead to a new high, and soon. The other day we were looking at the daily consolidation through the hourly chart, where a triangle is still in development. It’s reaching a point of maturity where the pattern is a valid one, and we’ll go with the break. To reiterate, the trend is higher so the break is more likely to occur to the top-side, but a triangle-break to the downside can’t be ruled out. Bottom-line: wait for the break.

SP 500: Daily (Hourly)

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Heads up: Tomorrow is ‘NFP-Friday’. We’ll have a look at the jobs report for April. For details, see the economic calendar. As per usual, it will likely require a sizable beat or miss to get traders excited, and the bigger move in the event of an outsized print is likely to take place in the FX/rates space. There is also the French run-off election between Macron and Le Pen on Sunday, so gap risk on Monday is very much alive.

Paul conducts webinars every week from Tuesday-Friday. See the Webinar Calendar for details, and the full line-up of all upcoming live events.

—Written by Paul Robinson, Market Analyst

You can receive Paul’s analysis directly via email by signing up here.

You can follow Paul on Twitter at @PaulRobinonFX.

Analys från DailyFX

EURUSD Weekly Technical Analysis: New Month, More Weakness

Published

7 år ago

30 september, 2017

DailyFX

What’s inside:

EURUSD broke the ‘neckline’ of a bearish ‘head-and-shoulders’ pattern, April trend-line
Resistance in vicinity of 11825/80 likely to keep a lid on further strength
Targeting the low to mid-11600s with more selling

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Coming into last week we pointed out the likelihood of finally seeing a resolution of the range EURUSD had been stuck in for the past few weeks, and one of the outcomes we made note of as a possibility was for the triggering of a ’head-and-shoulders’ pattern. Indeed, we saw a break of the ’neckline’ along with a drop below the April trend-line. This led to decent selling before a minor bounce took shape during the latter part of last week.

Looking ahead to next week the euro is set up for further losses as the path of least resistance has turned lower. Looking to a capper on any further strength there is resistance in the 11825-11880 area (old support becomes new resistance). As long as the euro stays below this area a downward bias will remain firmly intact.

Looking lower towards support eyes will be on the August low at 11662 and the 2016 high of 11616, of which the latter just happens to align almost precisely with the measured move target of the ‘head-and-shoulders’ pattern (determined by subtracting the height of the pattern from the neckline).

Bottom line: Shorts look set to have the upperhand as a fresh month gets underway as long as the euro remains capped by resistance. On weakness, we’ll be watching how the euro responds to a drop into support levels.

For a longer-term outlook on EURUSD, check out the just released Q4 Forecast.

EURUSD: Daily

—Written by Paul Robinson, Market Analyst

You can receive Paul’s analysis directly via email bysigning up here.

You can follow Paul on Twitter at@PaulRobinonFX.

Analys från DailyFX

Euro Bias Mixed Heading into October, Q4’17

Published

7 år ago

29 september, 2017

DailyFX

Euro Bias Mixed Heading into October, Q4'17

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

EURUSD: Retail trader data shows 37.3% of traders are net-long with the ratio of traders short to long at 1.68 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.07831; price has moved 9.6% higher since then. The number of traders net-long is 15.4% lower than yesterday and 16.4% higher from last week, while the number of traders net-short is 0.4% higher than yesterday and 10.5% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Positioning is more net-short than yesterday but less net-short from last week. The combination of current sentiment and recent changes gives us a further mixed EURUSD trading bias.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

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Analys från DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Published

7 år ago

29 september, 2017

DailyFX

British Pound Reversal Potential Persists Heading into New Quarter

Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

GBPUSD: Retail trader data shows 38.2% of traders are net-long with the ratio of traders short to long at 1.62 to 1. In fact, traders have remained net-short since Sep 05 when GBPUSD traded near 1.29615; price has moved 3.4% higher since then. The number of traders net-long is 0.1% higher than yesterday and 13.4% higher from last week, while the number of traders net-short is 10.6% lower than yesterday and 18.3% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests GBPUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current GBPUSD price trend may soon reverse lower despite the fact traders remain net-short.

— Written by Christopher Vecchio, CFA, Senior Currency Strategist

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, please fill out this form