The Monday session has almost nothing in the way of economic announcements, with the 11 exception that we will pay attention to, the Industrial Production month over month numbers coming out of America. The economic announcement is expected to release a 0.3% number, so any surprise could have an effect on the stock markets in general during the US session.
However, we do find interesting is the fact that the GBP/USD and the EUR/USD Forex pairs have formed hammers on the weekly chart. Because of this, it’s likely that we will see a bit of a bounce from current levels, as the US dollar might find itself a bit exhausted at this point in time. After all, it has been a fairly parabolic move in favor of the US dollar for some time.
The S&P 500 continues to grind sideways, so if we can break above the 2010 level, we think at that point time we can continue to go much higher. Pullbacks of this juncture are by far our favorite entry method, as we have no interest whatsoever in selling US stock markets. In fact, most stock markets around the world look to be rather vibrant, so as a general rule we are “long only” when it comes to stock markets.
The markets in general should start to see a little bit more along the lines of stability, after all the larger firms are coming back from holiday. Because of this, we feel that sooner or later we are going to see a change in the action that we see overall on the marketplace, and hopefully some type of trend. Going forward, we are looking at the market is one that’s trying to make its mind for the rest the year, as we normally see during the month of September. All things being equal though, we feel that the US dollar is going to take a bit of a break.
