top of page

FOREX Commentary and Analysis: October 28th, 2020

Updated: Dec 14, 2020

Risk markets are taking a dive today. As evidenced by the drastic drop S&P 500, things look very ugly. However, we would like to note that the night is darkest right before dawn.

That being said, our short-term risk oscillator is flashing very oversold conditions at -7.1. This can be a precursor to a bounce in the very near future.

What is causing this? There are various theories. First of all, COVID is spreading like wildfire everywhere. This is obviously a bad sign, but we understand the virus better today than we did in the past. As such this looks like it may be an overreaction in the markets. Second is the U.S. election, which is more likely to be the cause of the selloff in risk markets as we are seeing a huge bid under the DXY as a flight to safety trade is taking place.

Another aspect affecting the U.S. Dollar is the clear uncertainty with respect to stimulus. We continue to have a base case that it will get approved and relatively quickly. To us, the timing of said stimulus is not as important as the fact that it WILL happen.

We took profits on our GBP/AUD trade this morning with a +99 pips gain. Our other positions are currently losing. However, we are removing our stop losses and beginning to average down. You will begin to see the new updated averages in our Currenty Open positions page as we do. Please check the Positions page to see our updated averages. As stated, we are removing all stop losses as we reassess where the markets will move given the current environment.

Also, keep an eye on our discussion group in the APP as live calls may be made in that chat before they are posted on the site.

69 views0 comments

Recent Posts

See All
Post: Blog2_Post
bottom of page