GBP/USD's Above Average Trading Range
First off, fundamentals. Consumer confidence. I personally don't put a lot of weight in it as it tends to be a "lagging indicator". Why do I think it is a lagging indicator? Because mey experience tells me it follows the stock market. The stock market is lower, so consumer confidence is lower. If the stock market rallies, it should be higher. BUT, the bottom line is: it is yet another number that came in below expectations. What are the traders doing with that news? We know it: buying the equity markets.
Obviously the big "number" is Greece this weekend. Aside from that, let's look at next week's economic data:
**AUD Monetary Policy
To the technical picture. We are above the 1330 area in SPX (as of this writing) and hopefully that will move us into the "open area" and get us towards the 1360-1380 area. That would be pretty sweet given the poor economic data. At that point, I think we should analyze if the move from 1270 to the 1360-1380 area has gone "too far".
In forex, the GBP/USD had a massive range today - moving from 1.5472 tp 1.5650 - enough to qualify as a BUFFALO BOUNCE opportunity. Another indicator that can be used very, very carefully in trending markets like the one we are seeing in the GBP/USD today is the MACD. But, you have to know how to "adapt" the MACD. Remember, the MACD is mostly used in rangebound markets. But if you look the the "MACD Bearish Divergence" scenario, that sometimes can help in what could be "overbough territory".
Past performance is not indicative of future results
Thanks again to the almost 400 registrants that attended the most recent IBFX webinar. The video will be posted shortly here
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