Well, since I spent the last couple days away from the market while working on my trade manager, I figured I'm probably past due for some analysis on these market conditions. There have been some good entries in the last few days, but I generally don't like these kinds of markets. All of the pairs I watch are in pretty much the same situation. The ranging market conditions from the end of last week have continued on into this week despite some decent days on some of the other markets and even some pretty bad news on the others, for instance the Italian bond markets. If I recall correctly, the Euro today traded in a range of only around 100 pips or so. Each pair, as shown on the charts below, remains in a consolidated, ranging pattern. The only reassuring factor in all of this, at least for me, is that all of the consolidation going on is favoring a breakout soon as the channels price is being contained in are not equidistant ones. At the moment I'm favoring breakouts to the topside on the Swiss Franc and the Loonie and favoring downmoves for the Aussie and Euro. I'm not quite sure what's kept the Euro afloat as of lately, but I'm hoping that we'll be in for some serious movement soon so that I can get on the train to wherever the currency is headed. If we experience a major breakout, which seems possible given the state of the market the last few trading days, I'm betting that the correlation between the pairs will hold pretty well and allow me to trade according to the general direction of just one of the currencies. The most convincing break that would most likely drive the others well would be the Euro, and with the Swiss Franc approaching the floor set by the SNB not long ago, I imagine the correlation would do well on concurrent trades between the pairs. Charts are attached showing the current conditions with some valid S&R levels.
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