As we edge towards the end of the summer it’s worth taking a look at the forex markets as there have been significant trend changes over the last two to three months. We will start by looking at EUR/USD as this perhaps has been one of the most dramatic changes of all. The weekly chart above shows how we have established a downtrend since the beginning of May with that dramatic one-week reversal. It’s been a fairly steady descent back towards the lows of November 2013 as we now sit below the 200-week moving average at 1.3416. A break below the 100-week moving average at 1.3355 is likely to keep the pair under pressure into the autumn. It is worth looking at the daily chart below as this serves to confirm a more negative outlook and a likely continuation of the three-month bear trend. Note how the blue 100-day moving average line is now just crossing below the pink 200-day moving average line. This is commonly known as the ‘death cross’ and the grim name speaks for itself. This sell signal is something that longer-term traders and funds are likely…
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June 3, 2014, 7:00 pm (London)
September 23, 2013, 8.00pm (London)
Live Trading Session: US GDP
September 26, 2013, 12.00pm (London)
The major US stock market indices have seen a quite incredible rally since the crash of October 2007-March 2009. In this period the Emini S&P fell from 1586 to 666, a loss of 920 points or 58%. Very few investors saw this as one of the biggest buying opportunity in recent decades but that is exactly what it is turning out to be. In fact just for comparison the S&P 500 index quite steady growth after the stock market crash of 1987…the year in which I started trading on the London Stock Exchange Traded options market in fact. Then from 1995 it experienced an unprecedented rally up until the crash of 2000 caused by the internet bubble. These accelerated gains took the cash index from a 1995 low of 457 to a 2000 high of 1552, a gain of 1095 points or 239%. Chart shows the rally in the S&P 500 from March 2009 to Friday May 30th 2014. Each bar is one month. The next big crash occurred in 2007-2008 of course, taking the S&P 500 cash index from 1576 to 666. Very few investors and traders saw this…
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