Risk Tolerance Sparks Global Moves

Forex Trader Note: Asian and European equity markets have pushed to the top side of the 4 hour chart ranges, after a 70 point gap higher in German Dax futures trade, that allowed S&P futures to test the 1100 area. Crude oil has moved to $78, while gold has nestled in at $1130, both empowered by a risk tolerant move in global sentiment.

The markets are reading overbought against the Usd on the 4 hour charts, indicating that traders will be holding existing positions rather than adding too much more at these levels, at least until a reversal to support is seen that leads to a buy-the-dip move. The real question is now how much further thing can go on the long side, before the automated orders hit, that force a re-alignment. At 5760 resistance it may be the Dax that reverses to support first.

Lots and targets: Reduce lots and targets, and bank as you go.

Red Flag Economics:
05:00 EST Eur CPI Exp -0.1%, Prev -0.1%
08:30 EST Usd Core Retail Sales Exp 0.4%, Prev 0.5%

Dollar Index: The dollar index went into Neutral mode on 26th Oct and has not signaled anything that says it will easily move either way. The near-term path of least resistance is unclear. Swing Point: 75.90

S&P Futures: The S&P futures market is in neutral mode, and has held that for three sessions. The 1082 and then 1100 areas on the S&P are the near-term price action points. The 1055 support area looks solid. Swing Point: 1088

Crude Oil: Oil triggered a Short momentum flow on Friday, and will need to now find buyers quickly if support is to hold. 80.20 and 81.05 are the topside numbers. There is a lot of noise at the 78.50 area, with 76.50 support. Swing Point: 77.20

Gold Bullion: Gold signaled long on 3rd Nov and has easily held that mode. 1075 is near-term support, backing any long tests of 1120. As the market trades long gold as a hedge, it seems that the gold bugs will dominate. Swing Point: 1110

Disclosure: No positions