G’day Traders,
The reaction of the market to news is more important than the news itself. So whilst I believe US consumer confidence is one of the best long term stock market indicators, it seems the market discounted it with the US remaining pretty flat.
On top of the bad consumer confidence numbers, US housing vacancies and foreclosures are surging. How long stocks can ignore this horrible data is anyone’s guess, but remember I said earlier that positive data could overshadow negative data and, in the end, when everyone starts looking forward the market could fall.
Overall though, it is summer in the US and that is usually a strange time for stocks.
September Crude fell off the economic news, but still hasn’t crossed – the resistance held. Grains had a quiet session. Gold fell – for some a second day entry and to me it continues to break key support.
Cocoa is giving us a long. Sugar continues to trend nicely – even with a slight pullback overnight.
On Forex USD/JPY is giving a nice signal. The GBP/USD looks really long and we are starting to see bigger moves in the JPY pairs. USD/CHF has also given a good signal – out of a sideways market.
The US S&P500 -0.1 European top 500 +0.49 and UK +0.27%, The Nikkei was up a huge 1.58%, HK +0.64, China -0.55% with Australia up slightly early.
ETFs – Be patient. US is up at the top of its range so doing anything here would be silly.
Options – After last night’s news I am more confident in taking BECS again – keeping in mind I don’t want to have too many as if the market falls I would like to balance up with BUPS.
Today’s Top Tip!
Something a little technical today, in a computer sense. The Trader Workstation software we use as our trading platform, uses a simple piece of free software called Java. Without Java, your platform won’t work! You should get a pop-up box to tell you that it is missing, but if not, you will need to get it. Use the link below, or google Java to update or install it. On a side note, your virus protection software may try and block it, you will have to say yes, or allow to continue the download.
http://www.java.com/en/
Information for Beginner traders- There are some good signals in Forex. USD/JPY and USD/CHF have both been sideways, but see how the signals are strong and look to be moving out. Don’t stop trading something just because you have had a few losing trades on that lately. Then you could miss out on the really good move.
Information for Intermediate traders- As for beginners above, you may be targeting these types of trades.
Information for Advanced traders- Even with all the news on Cocoa, have a look at the weekly. The strategists and adventurers may be staying out of this market. Compare this to Coffee which looks horrible on the daily, but the weekly shows we should be taking trades.
Scott Goold
Head of Lifestyle R&D
