Tip from the Geek – It’s A Brave New World
Top 5 Trading Signals 09/08-15/2014 by the Geek
We start the week with a new looking CommuniTraders! If you haven’t noticed yet be sure to hop over to the forum and check out the new look and new features available on CT 2.0. Don’t worry though, the forum is still there with all the threads you have come to rely on. Getting back to the actual markets though the week started out kind of slow. Last week’s US NFP data was a little weak and left the global market wondering what it means. The expectation of a strong number, over 200K, was widely held and I in fact expected it to be higher. The low reading of 142,000 was well below the expected and raised questions of whether or not the economy was actually rebounding. The take, the market shrugged it off for a number of reasons. First and foremost the fact that August and even September are the slowest months of the year for hiring, have a high number of seasonal factors impacting them and are subject to big revisions. This has led many to raise expectations of revisions to this months number in the range of 200K or more. Adding to that is the fact that the unemployment rate fell. This has led me at least to think that job losses are less, counterbalancing a lower rate of new job creation.
This week the somber tone of the NFP report was countered by a weaker than expected trade balance reading from China. The numbers helped to keep Asian indixes mixed as well as those in the EU. European trade balance was surprisingly positive which leads me to think that the EU is recovering despite weak data this summer. Markets in Europe traded mixed, lifted in the late by the moderate open of US trading. US markets were mixed as well but early signs show that support was present. This is going to be quiet week for earnings and data but maybe not for trading. There are a few important releases but it will be a week or two before any major market shaking events take place. Near term geopolitical fears, the Ukraine, are on the back burner while the cease fire appears to be holding.
1. The Market Simmers
S&P 500
Call/Put = Call
Entry = Below 2005
Expiration = One Week
My Trading Advice
The market has been simmering for like two weeks now as we awaited the end of the summer, two major central bank meetings, geopolitical wrangling and economic data. The market is still doing this but seems to have gained a foothold on the 2000 level. The index traded above this level all last week, except for a brief dip below on Thursday that resulted in a strong push upward on Friday. Well, it was a strongish push up on Friday anyway. The SPX made it up above the 2005 level and set a new all time high. There is still some resistance in the form of all time intraday high but this I think is minor compared to the rising tide of support below the index.
The indicators are weakish at the moment but when you look at the index itself and see that it is holding firm above support this weakness is actually good. The market is relieving overbought and overextended conditions while maintaining positive, bullish, technical levels. This is setting the index up for break to new highs. I am trading a call on the SPX this week with a target entry below 2000 and one week until expiry.
2. The Tarnish Returns To Gold
Gold
Call/Put = Put
Entry = Above $1270
Expiration = One Week
My Trading Advice
Gold prices are falling. Now that the flight to safety that drove gold above $1300 is over prices are returning to trend. These trends are driven by positive economic trends and the imminent end of QE. My targets for gold are down near the $1200 level so I am trading bearish again this week. My target entry is above $1270 with one week of expiry.
3. Oil Wave Crashes
USO
Call/Put = Put
Entry = Above $34.50
Expiration = One Week
My Trading Advice
Oil prices continue to fall hard on demand issues and rising supply. The price of oil fell another dollar or more early on Monday with indications it could go lower. WTI and the USO, the oil tracking ETF, both dropped below support with strong bearish indicators. MACD and stochastic both point to lower prices so I am trading that way as well. I am trading a put on the USO with a one week expiry and target entry above $34.50. The break below support is very bearish but such a strong move is often followed by a retracement.
4. Have Faith In Germany
DAX
Call/Put = Call
Entry = Below 9750
Expiration = One Month
My Trading Advice
The DAX has been in recovery mode for the last few weeks but still has some room to move. US markets are trading at or above previous highs and that is where the DAX is heading. Today’s data suggests that exports from German remain strong, which is a good thing for them and for the global recovery. Indicators confirm my targets so I am trading a call this week. My target entry is below 9750 with one month of expiration.
5. Euro Has Great Technicals
EUR/USD
Call/Put = Put
Entry = Above 1.2945
Expiration = One Week
My Trading Advice
The euro has been losing ground to the dollar for months but last Thursday’s action was particularly bearish. The moves by the ECB pulled the rug out from beneath the euro and the all pairs responded accordingly. The EUR/USD fell below two key supports and is now consolidating for another drop. I am trading a put on the pair this week with a target entry above 1.2945 and one week until expiry.
More Tips by the Geek – 09/08-15/2014 Trading Tips On Forum.
___________________________________________________________________________________________
That’s it for this week; Michael will be here next week with fresh trading tips. Meanwhile, we will be testing Michael’s tips to see what kind of an “expert” he really is. All trading assets and expiry times featured in Michael’s trading tips are based on CommuniTraders Binary Options Trading Platform.
Think you know better than our experts?? Have a Second Opinion?? Post your trading advice on our Trading Tips Forum or at the bottom of the page! Join CommuniTraders and Start Trading, only on BOTS.com new growing community.