Hope everyone enjoyed the long weekend, I most certainly did with great friends that I have not seen in quite some time, family and a little time on the golf course. Were you surprised by the job number and the reaction in the markets, I was not, it is the same old story. A tad better than expected and the US equities roar higher and GOLD takes it on the chin. Bottom line is the number is not what the headlines say and the US is not creating quality high paying jobs to keep pace with its growing population and it does not take into account how many individuals have dropped out of the labor force!
3 sessions later the DOW JONES is 300+ points higher, the US dollar is on the verge of an upside breakout and GOLD is back up to $1250. For now the only market I feel worth trading is the US equity markets to the downside. I stand by my earlier prediction that the highs are in for the year in the US equity markets. Currently the DOW has traded up to resistance and I feel it does not have much higher to go! Have a look
I believe she starts to roll over from here for several reasons. Whether it be rising interest rates here in the States, slowing growth in Europe, Japan, China or even the runaway Oil price above $100. Something has got to give here. Look at this chart on OIL
The currencies may just be telling us something, I would love to show charts but I'll skip that because I do not want to overwhelm you. However, the Euro is below 128 and looking like it is going to break lower, I cannot come up with a reason for it to immediately reverse to the upside. The 2 commodity currencies that I follow look absolutely putrid with the CAD trading below 95 and the Aussie on the brink of breaking below 90. These 2 currencies are not in favor right now because global growth is coming into question. Take a look at this Copper chart, another barometer for global growth, all I can say is ughh!
Lastly, please read this story released today on the IMF's global growth predictions. Do you really think equities are the place to put your hard earned money? Please read this link
http://www.fxstreet.com/news/forex-news/article.aspx?storyid=33865409-a9e9-46b4-9c3c-e241785fbeac
Be Smart and Very Careful, I do feel that we are on the cusp of something huge!
Thanks for reading
TraderMartin
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