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We are starting to see a Usd ceiling getting put in place, but as yet still have all the majors still within a tight a trading range. If the dollar selling starts to build, we can look for the increase in market-wide participation as a signal that trade desks are being dragged into the arena.
Increasing global market volume may just be enough to move the dollar index lower, regardless of equity market moves. We saw on Monday an inability for the market to sell the major currencies lower, even in the face of fierce initial selling of stocks and oil, and on Tuesday have seen global equities move higher and hold again. On Wednesday we are seeing more of the positive side of equity trade. That bodes well for the major currencies, and may signal a move away from the Mixed trend reads.
Gold is doing its part to move things higher, and all it seems is needed now for the Fed to get its 'Weak Dollar' wish in place (they really do not want a strong dollar right now, whatever the sound-bites say), is for the oil barons to start doing some buying, to get things bid up, through, and holding $60 for a day.
We still do not have the global market momentum in-line to take full sized lot trades, and have to keep in mind that while equities, oil, and gold are not all in alignment, as they go through the transition of a swing change, we need to bank as we go. Smaller targets, bank 75% of them, pull the stop to the entry, and let a small amount run.
It will not take long to work through, but until the major pairs all get a trend direction that matches the global market, or at least get themselves off dramatically overbought/sold areas, we need to exercise caution in the amount of risk exposed to the market. The daily and four hour charts paint a great picture of the current global market participants; they are going through a swing change transition. As such, we will respect the fact that we are in a day trader's market, and will respectfully take what we are given.
On the majors; cad looks tired after the two day run, but never fear, aussie is here; Aud/Usd looks ready to take over the baton, and is trying to lead the European pairs that are stuck absorbing orders at their 20 day SMA areas. Yen looks lost, again.
U.K. employment data was mixed, Euro-zone CPI was benign, and ahead, the market has U.S. CPI data, and Empire Manufacturing numbers to absorb. At 14:00 EDT we get to see the FOMC Minutes from the previous rate meeting; the release is the perfect opportunity for the administration to get a signal out there that achieves their ultimate goal, and as we have seen recently, the market is very reactive to Fed Talk.