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Sir Pipsalot's Monday Market Update 2-8-2010

Discussion in 'Commercial Trade Journals' started by Sir Pipsalot, Feb 8, 2010.

  1. Sir Pipsalot

    Sir Pipsalot Former FPA Special Consultant

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    Hey folks,

    The EUR/USD remains in a downtrend that may take it to the 1.3100 area. 1.3000-1.3100 has many potential support levels clustered in that region, with many projections pointing to that area as well. However, we are quite oversold and past initial targets, so the move could turn around at any time. Right now I would say 1.3745 is a good level to trail SL's down to and use as a biasing point. As long as that level holds, any rallies should be considered pullbacks in a downtrend and shorted accordingly. Specifically, 1.3680-1.3700 would be a great place to try a short with trendline and fib resistance around there.

    A quick note on some of the fundamental reasoning why I've been talking about in the Profit Mongers room responding to questions:
    "[2:30] CM SirPipsalot: I've been calling for this big USD move for quite awhile... it's been long overdue and it has a lot further to go. The stage is still set for global deflation. USD will be one of the few currencies to benefit from that scenario as the world's reserve currency... not to mention this second leg of financial crisis is being led by Europe, not the US. The first leg we look back and blame the US Housing market. We will look back and blame Greece and Dubai in all likelihood for this one if it snowballs further. We don't need a market collapse to see major deflation... all we need is velocity of money to start slowing again, and a waning will to provide further stimulus accompanied by soveriegn default or the fear thereof will do a lot to slow down interbank lending."

    Stocks continue their downwards slide. While we may see intermittent days of rallying or consolidation, the trend is most defintely down and I feel confident we'll see prices below 1000 on the S&P before March. My next levels for profit taking on shorts is the 950-960 level and 860-870 for now. As the downmove develops, I may shift those targets based on the situation. At this point I would not expect a rally above 1100-1105 resistance. I also believe the highs for the year have been set around 1150 and I have told friends and family to shift to a much more defensive stance with their investments.

    Friday's NFP release saw mixed news as the Employment figures disappointed slightly and the Unemployment Rate improved to 9.7%, but did so amidsts changes to the calculation process that would have seen a worsening to 10.6% if the procedure had not been changed. All this lead to whipsaws on the currency and stock markets. CAD Employment saw a muted 32 pip USD/CAD decline on moderately better than expected figures. There's no news worth previewing for either Monday or Tuesday, so the next scheduled news we'll look at is UK Industrial Production on Wednesday morning.

    That's all for today's update. If you'd like to learn more about trading or trade along with myself and my collegues, come join us at Profit Mongers. Our subscription is very reasonable at $179 per month, and right now you can sign up for a 2 week trial to get started for only $29. This offer is for new customers only. If you have any questions, you can also email me at sirpipsalot@profitmongers.com

    To our success!
    Sir Pipsalot
     
    #1 Sir Pipsalot, Feb 8, 2010
    Last edited: Feb 8, 2010
  2. DTruth

    DTruth Recruit

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    Major Pips

    Thanks for the update. Am learning and trading as well with your analysis. I really appreciate it.:mad:
     
  3. Sir Pipsalot

    Sir Pipsalot Former FPA Special Consultant

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    No problem DTruth, happy to help
     

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