Stocks have recovered from their overnight lows after another sharp selloff and the short term momentum indicators now point higher, while the longer-term charts still look heavy. Selling rallies seems to be the plan – wait for the NFP to find out.
As with the stockmarkets, US$ saw a sharp move lower in US$Jpy ahead of a partial recovery although the path of least resistance still seems to the downside, so selling rallies is preferred. On the same theme as yesterday, I also suspect that the Euro, Aud and Nzd may all have further upside potential and buying dips is preferred in each of these against the US$, with a SL placed between their recent respective lows.
Gold spiked to 1519 on Thursday, before settling up 0.25% on the session, at 1505, a more neutral stance is now required, with the next direction to be decided on safe haven demand requirements. Neutral
WTI doesn’t like the current economic data and seems to have further downside potential although the short term momentum indicators do look mildly positive.
There are no trade ideas today ahead of the NFP, but in general I suspect the US$ will remain under pressure, while stocks look to be a “sell the rally scenario”.