No time for editing and posting my charts today. The big news this week is that the FOMC (the Fed) kept rates at present levels and set the expectation for low rates for the foreseeable future as they must or the U.S. economy will tank before it even begins to recover. The news every currency trader was waiting for was the Fed's purchase plan, and they decided against ending their purchase plan prematurely and even extending it, and acknowledged that the economy has stabalized out of it's free fall - well, we knew that last May, but they have to be conservative with their assesments. Equities futures are pushing up over yesterday's gains, Light Sweet Crude is up on the day over 71, Gold is back up above 955, and positive GDP figures came out of Germany and France. The only thing left to discuss is the data coming out at 12:30 GMT for the US, including Import Price Index, Retail Sales, and Initial Jobless Claims.
Seems like the USD is about to slide a bit today, but we'll see. The contrarian in me tells me this is not going to happen and will reverse at some point, but when you see a trend, resistance lines broken, and the probabilities point in a direction, you go with it. I do think a correction is going to happen, but waiting for the right time is crucial as optimism abounds. My advise regarding a potential reversal if you have the cajones, is to wait for a -ve catalyst (bad news) and to either have very tight stops or a lot of unused margin to absorb the push up and wait for the bounce. If I were very smart yesterday and on Monday, I would be long on both gold (was but lost $40 in a matter of seconds when the 950 support gave way down to 943) and silver (Jim Rogers play from weeks ago - I should have just bought weeks ago!), but I'm already abusing my margin as it is; I'm long in one of the Yen crosses, and some other risk currencies including AUD/USD (an indirect gold play), with an emphasis on GBP (contrarian reversal play from last weeks BOE extension of quantitative easing and the recent lows of this week), but I'm still slightly skeptical as always, and I need to do more research on precious metals trading...sounds like a project for a couple of weekends.
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