Monday Wall Street trade brings 100 pip channels in place on most pairs, under the daily average, but most importantly on a day of 2% moves in the S&P the Usd/Jpy pair has been trapped in a 50 pip range. That could be the ultimate signal from the market that they really do not want to be holding dollars this week, ahead of an acid test of the U.S. economy, infra-structure, and banking system, and three overseas central bank rate decisions.
The forex roller coaster ride on Monday continues, with Asian session highs and European session lows being tested in equal measure. TheLFB-Forex.com Trade Team said. The really interesting part, and the reason that the price points loaded for members to use and follow in the Market Outlook link above, is that there is just no volume increases as the break-out areas are hit. We stated at the start of the session that we would not be looking to issue too much today because of there being such an important week ahead of announcements and that Average trading Range and Volume numbers were so low that the law of probability was that things would test but not easily break until the U.S. got underway.
The majors are at the Asian session highs against the dollar, and now it comes down to whether U.S. equities will push higher, over and above the 2% moves already made. If they do we will look at the next leg of short dollar trades. It will be a move in equities that moves forex values today, and with a big move already in place, the 200 day SMA on the S&P acting as resistance, and low forex volume, traders will need to be very patient here. the Trade Team said.