Wow the importance of this resistance around 240 is emphasized in this chart!!!!
Optimal positional sell for a long time to come possibly! I will follow this pair more closely from now on
Red dots show previous resistance and turning points on monthly chart
: Wow the importance of this resistance around 240 is emphasized in this chart!!!!
Optimal positional sell for a long time to come possibly! I will follow this pair more closely from now on
Red dots show previous resistance and turning points on monthly chart
I've just read this, with more attention now...
I was looking at GBP biased down with the dollar while bised up with JPY. This sounds like a "divergence" to me.
When I read this, it is now clear that there is a massive divergence going on ACROSS THE BOARD. Not the RSI-kind of divergence. But a sentiment divergence, with the investors going into different ways this week.
Maybe this Friday will be the profit taking day in the carries, or next week?
15:08 Carry trades look set to contiinue as long as equity markets continue to make fresh gains, or it could be the other way around, that equity gains will continue while carry trades continue to perform (JPY-crosses higher). However, both JPY-crosses and US equity markets are showing increasing signs of stalling, with EUR/JPY capped by 164.00 and the DJIA rejected from 13,500. Momentum studies have been diverging with the recent price gains in both, and the newfound optimism over the USD seems misplaced given rising oil prices, higher gasoline prices, renewed Arab-Israeli tensions/conflicts, and the list goes on and on. US treasury yields are higher, which is usually negative for stocks (as is higher oil), and Fed Fund futures continue to exhibit a very small bias for a 3Q US rate cut, which is also at odds with rising Tsy yields.
Today's small range in US equities may be signaling an imminent stall, while JPY crosses remains just below key tech levels at 164.00 EUR/JPY, 240.00 GBP/JPY and 100.00 AUD/JPY. Tomorrow's only data out of the US is preliminary May Univ. of Michigan confidence, which is currently forecast to decline slightly from 87.1 to 86.2, with the risks on the downside due to higher gasoline prices (Weekly ABC consumer confidence fell from -5 to -7, also suggesting a deterioration in sentiment), but Michigan has not been as much of a moving force lately, so just keep an eye on price levels mentioned above.
So
Stocks up + dollar up + Oil up + Treasury up = divergence
FED biased for rate cut + dollar up = divergence
Today's Stocks down + carries up = divergence
I got caught back footed this week. BIG TIME. But after all, looks like the nonsense was all over.
Don't put too much thought into it cesar. From 2 years of experience, I see that as an analysis gets progressively complex the probability of it being accurate in prediction goes to 50% or lower. In fact, it's usually lower because investment houses and banks are mostly stupid. 90% of their traders are useless. With complexity there comes room for disagreement and chaos among buyers and sellers, whereas with strong news, obvious trends and agreed upon things like fibos there is far higher probability for success. I agree with you that it's "nice" to try and understand the bullsh*@$ that just happened(i.e what made the big boys sell/buy), but after enough months you will stop caring. Who gives a damn, they're monkeys. Let's just make money off them, I say.
Regards,
-P
