Welcome to this months episode of Full Moon Trading…
Today into tomorrow will be important.
Friday, the only ones able to trade the unemployment data will be Futures Traders. Both European & U.S Equity markets will be closed at the end of business today for Good Friday.
This means all bets will have to be placed for the weekend by today’s closes. Time Frame Trading…pay attention today!
Once again the pressing question ” will the Bull market give it up?” and show the first signs of a directional shift since the end of Dec.We’ve got a Bear Bias, so yes, we’re looking for the turn and the board this A.M. is looking like we can get it, however we still have to get through the day.
CAD/JPY..macro stops are around 81.80, once elected you can get another figure of downside.
EUR/JPY…looks to go as low as 105.90 on this swing down.
AUD/JPY… seems less vulnerable, with 83.40-60 as first good weekly support.
Euro…130.50 is half way back for this swing. Stops rest around 130. 30% of your shorts should be bought in at your discretion!!!!!!!! Once again this pays for your stop and the trade is on for free!
30 Yr. Bonds…138.15 is the 18 day mvg avg., “the same avg that stopped the rally at 138.27” for the 2 point break. A close over 139.05 is needed for more upside.
Model Trading Portfolio…Current Holdings
……………… Stop Close Profit Points
Long QID/Short NASD 29.40 33+
Short EUR/USD 131.66 GTC
Short AUD/USD 103.40 100/99
Short Term View
Location ,Location,Location….if you have a good trad able pattern “Good Risk reward!” You just have to seize the opportunity and see what develops!
Take what the market gives you , will be the order of the day.
Trade to Make Money!
Medium Term View…This will be updated next week for the 2nd Qtr.
30 yr. Bonds … 138.00 ish now becomes our macro pivot. Closing above this level would be short term positive the Bonds and negative the Equities. We will look to buy a multi-point break in the 30 for a rally into the fall in keeping with a general risk averse market theme.
Equities…While, we were in strategic buy mode for the first quarter, we now believe the market is fairly priced. The equity indices deserve a break. The operative question becomes, from what level and when can a break develop. We will monitor instruments on an individual basis vs. the general Risk On/ Risk Off correlation we saw last year, when most instruments traded via the theme of the day.
We’ve been doing this 35+ years…I’m hard pressed to recall a year when we haven’t gone back and attempted a re-test of the yearly close in the equity indices at least once. Yes, we are looking for a re-test over the next 5-4- months. Indices can still grind higher to the upper tgt levels over the next few weeks before profit taking ensues.
We are going to be highly flexible this qtr….we are not getting married to a central theme , nor are we getting into the long term prediction business. Having a bias is one thing, being patient and executing with a defined risk parameter another. Our business is Risk Management.
Currencies…AUD/USD continues to be a good risk barometer. 102 is the near term macro pivot! ( This is a multi-year level) 111 is the upside pivot. Anything in between is just that, in between….no break outs! Closes above 105.30 would be deemed near term positive.