USD/BRL… 20270 is the next Dollar resistance level…next are the bigger Fibs @ 20700.
NZD/USD…76.20-40 is a pivotal level. Once convincingly through, this should go to 74 for a start.
Both of the above are Risk currencies. More Risk Off and you’ll want to go South with a nice choice of hemispheres for your winter break next year.
Euro…looking at a 12 year semi-annual chart, 122 is in the cards longer term, via 126.40-60 as long as it remains below 130.70
Platinum…is already trading under the cloud on the monthly charts. Closing below 1418 ish will be a trend line violation drawn from the 2008 low. Sustained and closing price action under the area would lead to another 80 dollars. Platinum is a big risk indicator. Watch for overall market tone as well as any signs of life ( a pulse) in the miners.
Crude Oil…92.80 is Fib support with stops under 92.58-50 leading to just under 90
30 Yr. Bonds…147 is the old life of contract high. Price action around this level will be telling for all Risk Assets and currencies.
Pay attention to the SPU/BOND spread….the 30 yr. has higher tgt’s, so price action around this level will be key in telling the next swing in both the Spu’s and the Bonds.
Hamsters…it’s all about trade location and time frame trading. Pick your spots and trade to make money. You should get opportunity from both sides of the market.
Let the day unfold. It’s the start of the mid-week shuffle..let the games begin.
Model Trading Portfolio…Current Holdings
……………… Stop Close Profit Points
No Current Holdings
Short Term View
We have a Risk Off bias
Risk assets in general are trading short term oversold…Again this simply DO NOT SELL weakness…Sell Rallies. Risk Assets traded overbought in the first qtr…now they are trading just the opposite,Oversold.
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.
Bond Futures … 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.
Copper…We’re looking to sell rallies in the Copper against a 377 weekly close. We regard this as an ancillary short to the general Risk Odd theme going forward into late this qtr.
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 Intelligent 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.
NATGAS…We’re looking to buy the Natty @ 1.70.