Wednesday, October 01, 2008

Crazy Tuesday

What a day again... we all wonder whether we'll all have more of those... great for intraday trading, and certainly not so on the daily time frame.

Yesterday was a good day for the US$ which easily broke the 1.416 pivot level. We're now back at testing the 1.381 - 1.384 levels on EURUSD over the next few days (or less...). Obviously nobody sees a strong US$ in the medium term but we'll go with the flow as always...

ER: good recovery as hinted yesterday. We also notice our price segments still work after bouncing on 656, to reach 688, i.e. 2 price segments. Another down day is likely until this yo-yo calms down along with volatility. We could get back to the low 670s today. We anyway need to go through this hangover period before going solidly up.

ES: similar situation here except that ES didn't have enough steam to even test 1188 (was a good day though). 1165 is an important level, and ES is unlikely to hold it so here again another down day is expected.

Obviously bailout news will impact volatility again, but it seems market participants have had enough of it, and we could see markets behaving a little more normal in a few days... yet again 3rd quarter results may spur more nervousness again...
Daytraders have more fun ahead, but more conservative long term investors need more time to test the water.

(snapshots available on request)