There's three charts I want to share with you all tonight and none of them are forex charts - hold on! - there's a good reason why.
Each day i begin by determining the risk environment and to do this I use primarily the U.S. Dollar Index, the Dow, and crude oil. Today there are a number of levels that are in play and my focus is on the ceiling on the U.S. Dollar Index, the 200DMA on the Dow futures, and the 50DMA support waiting just below current levels on the S&P.
All in all, the levels that these three charts are sitting at actually indicate that risk appetite in U.S. equities could persist WHILE the dollar pushes against the 83.67 to 83.76 layer of resistance. Because of that I will continue to look for risk ON entries longer term (like aussie bullish positions) and limit risk OFF positions to shorter-term. I will also keep an eye out for continued dollar strength since there is still a flight to safety play (based on concerns in Europe) but the equities market - heading into earning seasons has been trading north of the 200DMA and holding mainly a neutral to bullish trend.
- An update on Risk and Transition 12:28 11 April 2012
- The EUR/USD Enters a Zone of Major Resistance 15:38 25 January 2012
- What I'm doing with today's dollar pullback. 10:34 18 January 2012