Need to gauge Asia's reaction from our sell off today for confirmation on tomorrows trade
For those that don't understand intermarket relationships. From left to right and can start at any point. Currency ------> commodities -----------> bonds -----------> Equity -------> currency --------> commodities ---------> bonds -----------> equity.
Huge markets reacting to one another, all interconnected, all correlated globally.
Given the circumstances, Spy is sitting in no-mans land right now with a straight shot to 316-317, but given that the DXY and OIL is looking to bounce off support/resistance means its bullish for SPY(meaning a relief bounce is probable, but will only be able to tell at tomorrows open, we need to see how asian markets will react to our sell off today)
The Dollar had a textbook breakout to the upside. When the Dollar rises, equity falls.(not all the time). When Oil loses value ----> spy loses value)
My chart merely shows that OIL is near a support line and that Dollar is near a resistance = Probability of Spy having a relief bounce.
The Risk vs reward is still heavily favored to the bears.
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relief bounce playing out nicely from yesterdays call.