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Tight Markets Define Late-Week Trade

Posted Thursday, January 17, 2019 by
Shain Vernier • 1 min read

From stocks to commodities, this week has brought tight trading conditions to a number of asset classes. The U.S. indices have posted a positive week featuring limited trading ranges. Gold and WTI crude have entered consolidation as traders debate the prospects of the coming months. Aside from Tuesday’s action facing the GBP, conditions have been modest, to say the least.

During the U.S. pre-market hours, two early January jobs reports hit newswires. Continuing Jobless Claims (Jan. 4) came in at 1.737M, above projections and the previous release. Initial Jobless Claims (Jan. 11) fell to 213K, beneath estimates and the numbers of late December. On a positive note, the Philadelphia FED Manufacturing Survey (Jan.) came in at 17.0, well above consensus projections of 10.0. 

U.S. Stock Markets Open Trade

It has been a light week on the economic news front. There have been no primary market movers scheduled, a viable reason that the markets have entered a rotational phase.

March E-mini DOW Futures (YM), Daily Chart
March E-mini DOW Futures (YM), Daily Chart

Overview: Tuesday brought a positive close to the March E-mini DOW, above the key 78% Fibonacci Retracement level (24110). This is a bullish signal and one that may be the precursor for a further rally north.

For the time being, I maintain a bullish bias toward the March E-mini DOW and the DJIA. With primary data releases scheduled for the remainder of the week, U.S. stocks are in a position to grind higher by Friday’s closing bell.

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