PrymFX Forex Newsletter - October 19th, 2020
Updated: Nov 22, 2020
The last few trading have been both interesting and calm at the same time. There is a great deal of hesitation in Risk markets, both ways, as we are close to the U.S. Election, waiting for an outcome on U.S. stimulus and Brexit.
We have a some profitable trades lately. However, it is definitely choppy and we expect these types of conditions through the U.S. election. Let's look at some charts to help us see where we may be headed in different assets. Presently, both our short-term and long-term Risk Oscillators are slightly in overbought territory. Given all the uncertainties, we expect the oscillators to bounce between slightly overbought and oversold conditions. We are not covering the DXY here today as we had a special commentary posted yesterday.
Looking at the S&P 500 as a proxy for risk. It has been looking like the markets want to break out to the upside as evidenced with the inverted head and shoulders pattern above. The neckline has served as support and this index has not violated it. Further, we see a down-trending line serving as resistance. We expect this market to stay rangebound until we get more clarity on the all the macro issues.
This fast mover, we pointed out last week to watch the 1.8300 level. Well, it looks like it is ready to break through and continue up into the 1.8700 area. As we speak it is breaking out of a very long channel. It looks like it is safe to go long now. Make sure to use a SL as this one can move very quickly.