ONE-TWENTY TWO: Trading Financial Markets
Exploring the poetry in financial markets for students of money and economy since the year 2000.
The Swiss franc almost got lost in the wake of the U.S. dollar’s tremendously sharp relief rally from support. In the last week, the franc has reasserted its dominance after experiencing an entire month of rare weakness. The daily chart of the euro vs. the franc (EUR/CHF) below demonstrates the sharp reversal that punctuates the … Read more
Last week, the iShares Barclays TIPS Bond Fund (TIP) surged to a fresh 2-year closing high on the same day the Federal Reserve issued its latest monetary policy statement. (TIPS = Treasury Inflation-Protected Securities – I will refer to “TIPS” when discussing the actual bonds and use “TIP” to refer to the ETF that uses … Read more
Mohamed El-Erian recently quantified the odds of deflation at 1 in 4, or 25%. His analogy to describe the dangers ahead seemed to be a recipe for inaction (and fear): “…ask yourself the following question: would you accept a lift from a person who has a one-in-four chance of getting into a really bad car … Read more
The British pound has been on a fascinating and very bullish ride versus the U.S. dollar. On Thursday, the pound accentuated its action by perfectly tagging the lower part of its bullish channel directly above support at the 200-day moving average (DMA). (Click for larger view) Source: dailyfx.com charts (click for larger view) I redrew … Read more
The extended downtrend in the Brazilian ETF, EWZ, remains intact. In particular, over the past 10 months, EWZ has made lower highs and lower lows. The gap up in the beginning of August marked the end of the last rally as it was stopped cold at the resistance from the downtrend line. The weekly chart … Read more