The futures market has been an interesting one lately. That is a big reason why I love futures, because one market can be going up while another one going lower. This week I want to highlight three markets. Mainly, because I daytrade the S&P futures, and want to grab a swing trade into the Australian Dollar or the Aussie as I refer to it.
Trading is not easy, but I prefer keeping my risk small. This means if I want to enter a swing trade I need to do it from a daytrade perspective.
The futures market provides many opportunities. Analyzing the charts provides us with possible trades, and the daily action provides setups for those trades. A risk-off move is happening at the moment, and the real question is how long will it last. There is a higher target, and the downtrend is over.
Future of The Futures Market
I believe that price is getting close to the end of the down move, but is not quite over yet. However, noone can predict the market with 100% accuracy. The key is to find pockets of space on the chart where we can predict it well enough to find trades. This is all any trader needs.
Another thing to remember is that no correlation last indefinitely, and no correlation is 100%. That is why I tend to stay away from talking about correlations in public. The one correlation that will be close is the US Dollar versus other currency pairs. The US Dollar has majority Euro in its holdings, so naturally the correlation to EUR/USD will be the highest. We can view this when looking at other currencies. Usually a risk-off market has the US Dollar rising and the AUD/USD heading lower.
These intricacies are part of what makes trading fun. Keep an eye on this the next few months. I expect a bottom is very close.