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The Market Giveth, The Market Taketh Away

ByJoel Kruger
Published 10/21/2013, 03:05 AM
Updated 07/09/2023, 06:31 AM
USD/JPY
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NZD/USD
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THE MARKET GIVETH AND THE MARKET TAKETH AWAY – It is just remarkable how risk assets have been so well supported in recent weeks despite some unnerving headwinds. Unfortunately, I have been forced to cut most of my losses and reduce exposure both in my Kiwi and S&P shorts. The past few months have been challenging to say the least, and I have done a good job eating into a chunk of profits. Still, this is the way markets go, and overall, it has been a good year. The best part is, the year is still not over and I believe there will be some great opportunities in the final weeks.

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STACKED CALENDAR – I am still looking to re-establish some meaningful short risk asset exposure, but at a very minimum, we will need to see a break and close back below NZD/USD 0.8440 and S&P 1730 to encourage these prospects even a little bit. I am also looking to reestablish a meaningful long USD/JPY position, but would like to see one more short-term pullback to buy into. USD/JPY has been in a contracting range over the past few months that has resulted in a triangle formation. When this thing finally breaks, the market should easily surge back above the yearly high at 103.75 and towards 110.00 over the coming months. Looking ahead, the economic calendar is stacked this week courtesy of the recent US government shutdown. I would be on the lookout for this economic data risk to potentially act as a catalyst for a surge in volatility.

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