Apparently Scott’s early morning paranoia seems to have been justified as we’ve seen quite a turn around in equities today. Which by the way clearly began ahead of reports of a plane crash near the Russian/Ukrainian border. What a royal mess and sincerely I hope this doesn’t turn into a larger conflict. As you can imagine both Russia and Ukraine will be in the hot-seat until investigators are able to figure out what exactly happened.
But let’s talk about the market. I often point at the GBP/JPY as one of the major carry trade pairs however some traders prefer the watch the EUR/JPY. Well, it’s been pointing down since yesterday and today it turned into a veritable cascade.
Which was mirrored by the GBP/JPY as well. I am keeping my eye on this one but thus far I don’t see any signs of a bounce. Not good for the bulls and it could mean we head lower.
Suffice to say that my long campaign was stopped out near the NLSL on the ES. Here’s the SPX cash which offers possible support near its own NLSL at 1969.56 followed by its 25-day SMA at 1962.39. Prices are currently re-testing the former but if it gives we’ll most likely visit the latter.
A lot more luck on the gold campaign which almost banked us 2R today as it literally exploded higher. That was actually unexpected as we just came out of a big move. I think by now you know the rules – if we close above the 1R mark we’ll keep the campaign open, if we do not then we close out near the EOD.
30-year bond futures also above the 1R profit mark at this point. Same idea here – we need to close the session above the 138’04 mark or it’s time to take profits and end this campaign.
I wanted to offer few more thoughts given the developing situation in the Ukraine. Over the next few days I’m sure we will see a lot of news drivel rife with accusations, rumors, misinformation, human tragedy stories, you name it. I strongly suggest you stick with a strict information diet which means ignoring all of it until we get unequivocal confirmation of the culprit responsible. Suffice to say that it should not affect your trading in any way – whatever price swings would have happened have already happened. Don’t let the drama queens, conspiracy theorists, and tabloids affect your mental equilibrium. As much as I regret what happened to the passengers on this ill-fated flight – this is not an opportunity to satisfy your lust for sensationalism.
Make no mistake – none of the sources spreading rumors or theories about what may have happened today should be trusted as they couldn’t give a rat’s rectum about the truth or the people who so horribly died. Eventually I am certain the truth will be revealed – until then the minimum we owe to the victims and their families is a speck of respect, which means not participating in a sensationalistic media frenzy. Just consider for a second it was the charred remains of one of your loved ones laying there on the ground – that ought to give you a bit of perspective.
I hate rubber-necking and refuse to engage into such egocentric activities – and the same attitude extends to any type of catastrophe – be it man-made or acts of nature. Let’s act like adults and maintain a sense of decorum. My thoughts tonight are with the victims as well as their families.
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