Again the market is testing resistance levels, though i must admit as there have been greater changes to the fundamentals, which might make me retake a stance for the rest of the year. Though i predicted steady economic growth, with the markets rallying on this and plus liquidity and M&A action. The markets may take an earlier down turn. Most curiously interest rate yields have followed suite of the equity indexes. Though i think i may have found an explanation. Despite fears of inflation of the fed, which would usually lead to a sell off in the bond markets. I noticed before the weekend on Friday the 6th i believe. The Dow and S&P were testing resistance levels as usual, though i should have looked into this deeper and looked up economic reports, i regretfully did not. So i did not see todays immediate downturn. But as i was saying, on that Friday, all equity indexes were up and bond yields had volatility risen to 5.20%. Every index i saw domestically and abroad were up EXCEPT the Nikkei 225. I did think this as odd and knew that the BOJ was warning on raising rates, the sell off must have meant to me at the time that money was looking for better investment in the interim. Hence this Monday and Friday the yields have considerably dropped to a 5.04. Perhaps part of this reason had to do with the flight to quality in the mean time when Japaneses investors were looking for a better investment.
At any rate my oil top prediction of around 70 has been considerable off for a few days now. As to why i must now figure out before i can proceed trading oils ever again. Though this rally in oils i still do not expect to last much longer.
As to if the equity index can break resistance i still think it is possible though i would put more of a longer term downtrend more possible with the number of tops which may be indicating momentum loss. Though as looking through back charting on the S&P this was quite common before steady or mild rallies.
As far as currencies go, i truelly did not expect the Euro to shoot all the way up to 1.37, considering the sentiment of market it appears as another overreaction though, i would not consider this to be as superficial as previous ones. Because it is a slight overreaction the dollar will strengthen after things calm down and the euro will probably fall with the change in dollar.
Also considering the change, and change in market sentiment it maybe possible people will start a shorting frenzy.
Though i am still in favor of steady growth in the markets and economy for the rest of the year. Though, what i may see, may not happen. The truth is not what it should be or what we think it should be, but what shows. And currently, the markets appears to be on a turning point, or a breather before breaking through resistance.
At any rate my oil top prediction of around 70 has been considerable off for a few days now. As to why i must now figure out before i can proceed trading oils ever again. Though this rally in oils i still do not expect to last much longer.
As to if the equity index can break resistance i still think it is possible though i would put more of a longer term downtrend more possible with the number of tops which may be indicating momentum loss. Though as looking through back charting on the S&P this was quite common before steady or mild rallies.
As far as currencies go, i truelly did not expect the Euro to shoot all the way up to 1.37, considering the sentiment of market it appears as another overreaction though, i would not consider this to be as superficial as previous ones. Because it is a slight overreaction the dollar will strengthen after things calm down and the euro will probably fall with the change in dollar.
Also considering the change, and change in market sentiment it maybe possible people will start a shorting frenzy.
Though i am still in favor of steady growth in the markets and economy for the rest of the year. Though, what i may see, may not happen. The truth is not what it should be or what we think it should be, but what shows. And currently, the markets appears to be on a turning point, or a breather before breaking through resistance.
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