Current Affairs effect on the market

[peterma]

@peterma

This thread is focussed on ‘current affairs’ which many see as FA - yet the market is both FA & TA

Perhaps coming a little boring - an update on the above chart - and the TA/FA thing - also posts ref investors seeking value post back Nov.

Not so many charts this thread, maybe look back May '23 - the significant then was 4049.6 on the horiz & the trend line

@peterma

S&P with it’s upward trajectory since Oct '22

Last year there was much talk re US recession - talking heads who repeat what they hear.

Anyways TA/FA in tandem since my last post - the level then was 4926.70 - here’s what happened hr4 since then

:Edit: The FA factor was Nvidia -“carrying the weight of the world etc” (i.e. the future of tech & where return lies)

[peterma]

@peterma

Yen taking a beating this am - reason is BOJ have confirmed no intervention in past 4 weeks.

Market viewing this as meaning that the CB have decided not to defend the 150 line.

Will they intervene beyond this level in coming 4 weeks?

Difficult to say - reason enough for to stay clear - I remember last time they removed the peg.

Above was last day of Oct 23 - price made it as high as almost 152 and then backed off right down to 140 - then in came the buyers yet again early Jan - aware of the 150 level perhaps - a safe cushion.

This time almost 151 and guess what - heading south yet again with a push down on the back of BOJ comments

Like I commented some months back -

@peterma

there are different way of defending a line - lately CB comments can do the trick.

[peterma]

@peterma

Anyways TA/FA in tandem since my last post - the level then was 4926.70 - here’s what happened hr4 since then

That was 2 wks back - the level then was 5086 - here’s what happened at that level hr4 since.

The levels have it.

[ZforexCM]

The pair is clearly rising since April and continues to do so after the Reserve Bank of New Zealand (RBNZ) warns about the inflation.

Yet, the kiwi comes face to with the resistance level at 62.15 and the daily RSI is near overboght condition.

Trading Direction: Short

• Sell NZDUSD at 0.6175
• TP at 0.6045
• SL at 0.6240
• R.R: 2

[peterma]

While since I posted re S&P and it’s upward trajectory.

Very often retail guys will bet against price - the expectation being that price ‘must’ reverse ( called gamblers fallacy)

Anyways long story short stocks rise because earning rise (amongst other things)

This from Carson 8 mins ago

Market Commentary: Earnings in the Long Run, and Short — Carson Wealth

[peterma]

@peterma

In other market news - US Stocks.

Ryan Detrick noted last week that 60% of S&P constituents hit a new 20day high - a signal that suggests gains for the S&P over next year.

Accuracy?

It’s not a common occurrence - 15 times to be exact - 100% accurate.

That was just over 6 months back - was it accurate?

[peterma]

How fundamentals can change - today is 2 years since …

The yield curve inverted - the harbinger of a bear market - or so it has always been.

So what happened the recession that many guys -including the experts on BP - were warning of.

It’s still to come they say.

Earnings make the market - let’s see.

[peterma]

@peterma

That was 2 wks back - the level then was 5086 - here’s what happened at that level hr4 since.

The levels have it.

Thought I’d do a little update - I posted on March 7 re S&P levels - monitoring these levels can be important - ‘Pivotal Points’ as Jesse Livermore called them (not to be confused with pivot points)

Anyways there were 2 levels in the chart i posted (see below) 5086 and 5158

[peterma]

In the recent pull back on stocks these levels played a role:

[peterma]

@peterma

In the recent pull back on stocks these levels played a role:

Two days back see the level 5454.20 when I posted.

Cisco posted their earnings after the close which was a beat - Walmart same 24 hrs later

@peterma

Earnings make the market - let’s see.

See how the level held next morning - bulls buoyed with the earnings -(chart below)

As Ryan Detrick posted 1 hr back:
Congratulations to those who ignored the fear mongering.

[peterma]

@peterma

Congratulations to those who ignored the fear mongering.

And so it continues - the above level was 5559 - today 5753

That’s not really the lesson, today is the 1st Friday and the lesson is in the numbers.

Services are the largest employer in US - around 70% - so surprise surprise a positive non farm payroll:

United States ISM Services PMI (tradingeconomics.com)

:

[Reggie_Smith]

Great initiative, Peter! It’s fascinating how current affairs shape market sentiment, especially with your experience in Euro/GBP trading. I’m looking forward to your insights on how USD, gold, and the stock/bond markets influence EG’s direction. Let’s see where this discussion takes us!

[peterma]

EG has been on a downward path for a couple of years now - now rumbling along 83.00 - a support level (monthly chart)
Gold is interesting, it’s doing it’s own thing regardless of geo political, USD, Rates, Bonds so the question is what is driving price up - somebody is buying but who & why?.

Perhaps some of the answers lies here

Central Banks | World Gold Council

[ausguyforex]

There was a big buy for gold in November, just waiting for the big sell

[peterma]

Israel attacked military targets in Iran.

Significantly no nuclear or oil targets thus decreasing the risk of escalation.

Brics meeting over, markets closed - timing is important.

So what effect on the market - don’t think I’d want to buy oil Monday morning.- unless something catastrophic happens meantime.

[peterma]

It wld be remiss not to mention the most current affair effect on the market - i.e. the re-election of Pres Trump after an absence of 4 years.

The most noticeable effect is on stocks

2 things, US stocks have been rising all day, the 2nd thing worth noting is that European stocks have done the opposite - an unusual divergence and maybe gives credence to the possibility of parity re Eur/Usd

Investors will be looking at policy changes on US tariffs in particular.

[brainchild2]

@peterma

Been intending to start a thread on this subject for some time.

Current affairs cover a wide spectrum - I will only post on how the market is likely to react short and near term, in other words it’s about the market’s opinion and not ours.

First up who I am - I’m a business person - this is my 41st year after having served a 7 year apprenticeship. I do business on the land border Euro/Gbp so buy and sell in Euros and Pounds since the inception of the Euro.

I ‘watch’ EG and attempt to take a view on it’s short and near term direction. To help with this I need to take a view on USD which in turn means looking at Gold and the stock/bond market - more later on this.

It sounds like you have a wealth of experience and a solid approach to analyzing the market. I agree that understanding the broader economic factors like USD, Gold, and stock/bond markets is essential for forecasting short-term movements in EG. Looking forward to your insights on these connections!

[Elliotrades08]

@peterma

Been intending to start a thread on this subject for some time.

Current affairs cover a wide spectrum - I will only post on how the market is likely to react short and near term, in other words it’s about the market’s opinion and not ours.

First up who I am - I’m a business person - this is my 41st year after having served a 7 year apprenticeship. I do business on the land border Euro/Gbp so buy and sell in Euros and Pounds since the inception of the Euro.

I ‘watch’ EG and attempt to take a view on it’s short and near term direction. To help with this I need to take a view on USD which in turn means looking at Gold and the stock/bond market - more later on this.

Great introduction! Your experience with currency pairs like Euro/Pound and monitoring USD, Gold, and the stock/bond market provides valuable context for predicting short-term market movements. It’ll be interesting to see how your insights develop, especially given the interconnected nature of global markets. Looking forward to more detailed analysis!

[peterma]

@peterma

an unusual divergence and maybe gives credence to the possibility of parity re Eur/Usd

Meanwhile 2 wks and a few hundred pips later that goal is much closer.