Volatility (VIX) is so stretched right now that when it pops to the upside I think we’re going to see a sharp selloff that is going to surprise a lot of people. With that being said, I think it will be a good idea to buy this next dip because the charts suggest we’re going higher, at least that is what my timing signal is suggesting. The scarier the selloff looks/feels the better. The key will be to ensure that during the climax of the sell-off that my timing signal remains bullish. If so it will be a great buying opportunity for those (like myself) who have missed out on the meat of this move.
Currencies look like the US Dollar could move higher with the Canadian Dollar at key resistance. This channel on the US Dollar isn’t a given at this point, but if the markets do sell off then it makes sense for the Dollar to rally….potentially back to the $81.50 level (which I’ve noted at R1). Resistance 2 would be near $83.
After breaking out of a wedge and nearly hitting resistance, I could see this moving back to the apex of the wedge near .9750, where it could find support and make a run at $1.01 again.
February 7th, 2012 at 6:14 pm
I think we are all too occupied with Greece debt and afraid to trade. Taking risk is necessary in this business so don’t get distracted by market noise too much. Just as Bernanke start to take the mic, I am long on ES and just as he about to finished his speech, I am already out with 4 points gain. Thank you Mr.Chairman. Then I went into Wheat futures and make some there too before market close at 2.15 EST and thanks to news on weather condition in Ukraine and Argentina. I will continue to monitor wheat again. By the way I am using 100 and 300 tick charts for wheat and 300 – 900 for ES. Cheers.