William McChesney Martin, Jr.

William McChesney Martin jr.jpg

The job of the Federal Reserve, he famously said, is “to take away the punch bowl just as the party gets going,”that is, raise interest rates just when economy reaches peak activity after a recession.

William McChesney Martin, Jr.

  • Increasing sign of volatility and low volume trading taking control
  • Equity market tumbled – raising questions about the current rally
  • Commodities glut continue with no respite

Dollar Index

Daily

The dollar bull raised up a notch and take the index higher to the second sell zone that we highlighted. Now, it has to make a decision of either consolidating higher or fail to retest the lower end of this megaphone pattern. Time will tell but given the timing of this price action, it seems to favour holding dollar long with bulls firmly in control.

Vix

Weekly

Technically, the VIX could head lower and retest the blue dotted support line. There is a potential fractal of Dec 2014 – Jan 2015 at play but we will continue to monitor.

US Oil

Daily

We added Crude Oil as part of our observation purely for technical reason. There are certainly signs that the selling may have abated but it does not discount the possibility of further sell-off due to liquidation. At the moment, the structure continue to point south but a dead cat bounce is possible. Certainly one to watch out for in 2016.

Gold

Daily

Sell-off post FOMC as the dollar strengthen further but buyers appear near 2015 low. Sellers are in full control and a break of 1045 will open the door to test psychological level of $ 1000. Support also comes in at 1033 while only a break above 1080 will relieve the selling pressure with upside capped at 1100.

Euro

Daily

Euro support stands at 1.079 and a break lower could dictate a much lower retest. With current trading session, traders may not positioned for big directional move but once cannot rule out a minor bounce off the mid bollinger band. Watching how the US dollar play out.

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