Central Banks and the Bund
This week we have to contend with a whole flurry of central bank meetings - BOE, Fed and ECB...these tend to lead to quite stagnant markets beforehand and a flurry of excitement afterwards. Having a quick glance around the markets, the Bund has caught my eye this morning.
Why the interest? Well from a longer term perspective we are convinced that a major top is being built, but here we are in mid-December having seen a 6-week bull run that has triggered a 5 big figure rally. So where does that leave the chart now?
Well firstly it is important to note that even though we have seen an aggressive rally, it is viewed as corrective only and is failing just ahead of the 78.6% Fibonacci correction at 175.55. Secondly last week we saw a fairly decent key day reversal BUT this did not break the uptrend....at 173.51... So how do we trade this?
While we are still in an upmove, it is seen as now unstable (the key day reversal) and the failure at the 78.6% retracement is more than worrying. If holding longs in this I would tighten up those stops and start looking into selling into strength....would seem to be a reasonable strategy.
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The information posted on Trading View is for informative purposes and is not intended to constitute advice in any form, including but not limited to investment, accounting, tax, legal or regulatory advice. The information therefore has no regard to the specific investment objectives, financial situation or particular needs of any specific recipient. Opinions expressed are our current opinions as of the date appearing on Trading View only. All illustrations, forecasts or hypothetical data are for illustrative purposes only. The Society of Technical Analysts Ltd does not make representation that the information provided is appropriate for use in all jurisdictions or by all Investors or other potential Investors. Parties are therefore responsible for compliance with applicable local laws and regulations. The Society of Technical Analysts will not be held liable for any loss or damage resulting directly or indirectly from the use of any information on this site.
Why the interest? Well from a longer term perspective we are convinced that a major top is being built, but here we are in mid-December having seen a 6-week bull run that has triggered a 5 big figure rally. So where does that leave the chart now?
Well firstly it is important to note that even though we have seen an aggressive rally, it is viewed as corrective only and is failing just ahead of the 78.6% Fibonacci correction at 175.55. Secondly last week we saw a fairly decent key day reversal BUT this did not break the uptrend....at 173.51... So how do we trade this?
While we are still in an upmove, it is seen as now unstable (the key day reversal) and the failure at the 78.6% retracement is more than worrying. If holding longs in this I would tighten up those stops and start looking into selling into strength....would seem to be a reasonable strategy.
Disclaimer:
The information posted on Trading View is for informative purposes and is not intended to constitute advice in any form, including but not limited to investment, accounting, tax, legal or regulatory advice. The information therefore has no regard to the specific investment objectives, financial situation or particular needs of any specific recipient. Opinions expressed are our current opinions as of the date appearing on Trading View only. All illustrations, forecasts or hypothetical data are for illustrative purposes only. The Society of Technical Analysts Ltd does not make representation that the information provided is appropriate for use in all jurisdictions or by all Investors or other potential Investors. Parties are therefore responsible for compliance with applicable local laws and regulations. The Society of Technical Analysts will not be held liable for any loss or damage resulting directly or indirectly from the use of any information on this site.
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