June 22, 2011
Greece vote of confidence comes up short, Gold & Crude Oil tumble on lack of demand, and traders prepare for FOMC Day
All eyes overnight were on the confidence vote out of Greece, which was supposed to calm our nerves about moving forward with a solution for the Euro. Last night the PM of Greece won by the narrowest of margins, and basically ‘beat the vote’ straight down party lines…a true political move to save his skin, but in the process he killed the confidence we had earlier in the week, resulting in higher concerns over insuring the debt that is about to be absorbed by the EU. It will be interesting to see how the US Dollar reacts to this news today.
Traders around the world are expecting another low demand reading from crude oil inventories, which is pushing down prices on crude oil this morning. Many news reports this morning site traders assuming that prices will remain quite choppy (read as…sideways) for the medium term. Sounds good to a day trader buying the lows and selling the highs.
Gold futures also declining today for the 4th day in a row as the strengthening US Dollar Index has taken the pressure off long term investors to take shelter from the ‘storm’ which is giving Gold selling pressure on the lack of fear. News reports this morning talk about how the confidence vote in Greece actually killed the confidence in the EU, which is giving the US Dollar Index a boost higher, causing the Gold Futures to lose their ‘appear’ to fearful investors, causing prices to drop overnight.
Looking forward at the news this morning…
All eyes on are two main things. We have FOMC Day today, which has an FOMC Announcement at 12:30pm, then followed by a public Press Conference by the Fed Chairman Ben Bernanke to answer questions and read a statement of the announcement.
Trading on FOMC Day is a bit different than most days, so we need to know how to properly trade FOMC day. The key is simple…be selective, get in early, and get out early as traders take profit ahead of the release at 12:30. Expect volume to drop after 10:45am est this morning so im watching the speed closely.
We can’t forget about crude oil inventories at 10:30 this morning, another very important aspect of today’s price action. When I think about Wednesday I think about 3 phases of Crude Oil Inventories, so this will be on our minds all morning today.
And finally, once price action slows down after 11:30am this morning we have our private members training, so we will plan on watching the FOMC release together with members at 12:30pm EST today.
Working on charts now..
