OK I am back in action following my 4-week drive through British Columbia. Highly recommended.
As far as the markets are concerned, I am glad I was not around as it has generally been very choppy and difficult judging by the look of the charts, with Sterling being the only real directional mover in the currencies.
Looking ahead, I assume we can expect another choppy but largely sideways day today while waiting on tomorrow’s FOMC meeting although Donald Trump’s speech at the UN could create some waves. While no rate hike is expected this month – with December being the month in focus for that to happen – the Fed is expected to announce its plan to commence the unwinding of the balance sheet. They have been flagging for quite some time that this is going to occur and so little effect is expected, although it is the beginning of a tightening of monetary policy, so a bid tone to the dollar would not surprise.
As far as trading ideas go for today I am not expecting there to be too many clear-cut opportunities although the following may be worth watching.
The Aud just had a brief run up to 0.7992 on the release of the RBA Minutes – which really told us nothing new. The squeeze higher was quickly rejected and we are now back at 0.7965.
With the short-term momentum indicators looking heavy, a return to the previous session low of 0.7940 could be on the cards, below which could see a move towards 0.7920 and even towards 0.7900 and eventually to 0.7880 although that still appears some way off. Keep any SL on short positions placed just above 0.8020 (200 HMA).