A Dow Theory Crash Course.

by Rasool Cunningham
Chief Trading Editor
Philadelphia, PA (DYDD)

The market is always to be considered as having three movements, all going on at the same time. The first is the narrow movement from day to day. The second is the short swing, running from two weeks to a month or more; the third is the main movement, covering at least four years in its duration.

That’s from a Wall Street Journal editorial published on December 19, 1900. The time frames Dow gave were specific for his time because time expands and contracts along with price. (As we’ll be learning here on DYDD in the future. Einstein also proved time expands and contracts with his theory of relativity.) So we’ve seen what he describes as “main movements” last longer, and less time than he looked for back in 1900. But the basic tenant that the market has three movements going on at the same time is still valuable info today. Traders get caught on the wrong sides of these movements because they’re either unaware of them, or don’t know how to determine what price action is a part of, or determines what movement. If we don’t know what action is part of what movement we can’t assign value, or importance to the price movements that deserve high priority.

When you can’t prioritize price action you don’t know what price action to ignore or pay close attention to. This way you can’t use price action to maximize profits. If a “narrow move” or day to day move isn’t important, yet you place a lot of importance on it, that movement may lead you to take on more or less risk than you should. We all know a time or a million times we’ve placed too little or too much importance on a price move and paid for it. So how do we know what move is which, and what price action is more important? To paraphrase Dow, he tells us that the most important price actions are higher highs with higher lows, or lower highs with lower lows. He said this tells us what the “main movement” or trend is.

He called a correction a “Secondary Movement” or “short swing.”. So named to imply the move wasn’t as important as the “Main Movement.” Here’s an example of how we use these movements today. Below is a chart with a main move and several secondary moves. A trader would have been better off to hold for the gains from the main move than to try to take advantage of all the short swing secondary moves:


When we hear the phrase “Dow Theory” we think of the indices and index theory that Dow Transports should confirm any major directional movement in the Dow Industrials. But this is only the tip of the iceberg. Beneath the surface, Dow’s theory is time analysis on top of a trend following/ trend determination system. Since Dow never compiled his work into a system, much of the credit for what we now call Dow Theory should go to men with names we don’t hear anywhere near as mush as we hear Dow’s. Men like Samuel A. Nelson, William P. Hamilton, Robert Rhea, and Richard Russell. Men who delved into Dow’s work and put together a comprehensive system based on Dow’s market theories. Dow worked as a partner for a company named Goodbody, Glynn and Dow. They held a seat on the New York Stock Exchange from late 1885 to mid 1891. Long enough for Dow to get an upclose look at the market. But he started and ended, as a newspaper man from Connecticut. He came to New York as a financial reporter. In this work he met a guy named Edward D. Jones. They went on to found Dow, Jones and Company; they published the Wall Street journal, and the rest is history.

The simplicity and staying power of what Dow left is awe inspiring. He said If you’re trading in a bull market a trader should buy on pull backs, and If trading a bear market we should sell on up moves.He said traders should scale into positions in case price goes against them, or takes longer than expected to gain value. He defined what a trend is with the phrase higher highs and higher lows or vise-versa. The old trading axiom “cut losses early and let profits run” comes from Dow. These are things we still heavily use today, and can be found in every trading system known. That’s a big deal to me. A big enough deal to revisit he and his disciples’ original work as much as possible.

It’s impossible to to even outline all the things Dow, and those who expounded on his theory have left us in one or two post. Luckily for you traders, I started a new service today where I’ll be pouring  the rest of my interpretations and applications of this timeless knowledge in a series called: A Dow Theory Crash Course. 

Each one will be titled A Dow Theory Crash Course and be numbered; should be easy to find once they start posting.  I’ll apply everything to current markets with easy to grasp examples and visuals. There will be lots and lots of visuals (so if you think there’s a such thing as too many pictures in a blog post, this probably isn’t for you.) I think a picture says a thousand words, so, they save us (me) time; they help us hack the learning curve. So get the June 2015 password here and check them out as they post!

Thanks for reading traders, and happy hunting!


Old School Stock Valuation Tools, Gann, Fibonacci, and Elliot; Plus, a new DYDD Journey.

by Rasool Cunningham
Chief Trading Editor
Philadelphia, PA (DYDD)

After going up for six years in the face of constant ZeroHedge articles, and every bear in the woods rooting against it, this stock market seems invincible. I get that, but we know stock markets aren’t invincible, don’t we? We know what happens when people start thinking stocks are invincible… don’t we? Maybe this time is different? Maybe all these metrics saying stocks are overvalued are wrong. Maybe Fed Chairperson Janet Yellen is wrong. Maybe I am wrong. There’s a lot of information out there. A lot of “metrics” and “data points.” The thought is some of this stuff works sometimes because: “even a broke clock is right twice a day. With all these broken clocks they’re bound to be right once in a while.” Well, what’s not a broken clock are the traditional metrics used for stock valuation. Looking at some, one could conclude that stocks are overvalued. Take Warren Buffett’s favorite stock market valuation tool: The Market cap to GDP ratio. Dshort wrote about this on May 1st. It says stocks are overvalued. Another great stock guy, Peter Lynch says this about stock valuation:


Long term bonds currently yield 2.93%. The $SPX dividend is now yielding 1.93. I didn’t need to do the math to see that this indicator says stocks are overvalued. But I did the math anyway, and it said long term bond yields exceeded the $SPX yield by 33%. More than five times Mr. Lynch’s caution threshold. But that’s ok, It points to tremendous opportunities.

In the coming days, months, years I’ll be trying to capitalize on these tremendous opportunities. First and foremost, with my own trading of currency markets. But since no market trades in a bubble, and all other markets effect, and are effected by the currency markets; I analyze stock futures, leading stocks, bonds, gold, oil, and nearly anything with a price. I’m doing the work anyway, I mine as well try to capitalize on this work any way possible. I think I’ve found a way. This isn’t new for me. I’ve failed in past attempts to capitalize on my analysis. I think I failed because I wasn’t offering enough value. Maybe I was too one-sided, or just not enough dimensions.

I’m a price guy. So nearly all my analysis is price based. We know price, time, and volume form the stock technical analysis bedrock. For a truly comprehensive approach you need a solid understanding of all three. I’m proficient in volume analysis (although if I come across a good volume heavy analyst I’ll try to recruit her to add to what we’re doing here.) But I’m lacking in the time department. I understand the basic concept, but I don’t know how to apply the best available tools for time analysis, which I think are Elliot Wave theory and Gann theory. I have a new friend who is a time analyst who is talented in the application of these tools. I think we make a good team. So, along that “capitalizing on opportunity” theme:

Starting today she and I are offering a monthly subscription service here on DYDD. June 2015 is free. 

It will consist of her full understanding of Elliot Wave and Gann theory. She will build an archive of lessons from her understanding. I will expound on the lessons, as well as apply my price, volume and fundamental analysis to her time analysis. She has a lot to offer. I think I have a lot to offer also. So we’re combining forces. It will be a simple password protected post.

Every month the password will change. Which means you’ll have to tell your browser to remember each monthly password. For that inconvenience you’ll get Pauline’s posts, lessons, and all I have. Including info like what you see above with the Buffett and Lynch valuation insights, plus a lot more. Fx trades, levels, and risk reward profiles all given in an easy to understand manner and format. Also:

  • A full archive of my understanding of Fibonacci retracement theory.
  • A full archive of my understanding of price theory and index theory.
  • A full archive of my understanding of Soros’s Reflexivity/ Fallibility theory.

I’ve been studying the markets very hard for more than eight years now. I’ve touched on a lot of things along the way. Hours and hours of pouring over books digging diamonds out of the history of everything from politics, to markets, to technical analysis. Up until now I’ve been giving away my thoughts on current events in the markets, but holding back the most precious info; using it to trade. I’m not a big enough trader to take full advantage of this precious info/ skill. If I were I wouldn’t be offering anything. This is going to be a lot of work for Pauline and I. She’s been trying to recruit people to help her with the writing. She asked people who have bought her book and have been in contact with her. People who know the system and can do the writing easier. One said no, another never got back to her. It’s a lot of work. But I enjoy sharing and helping people. I also understand Pauline when she says she’s done too much work to just give it away. I’ve done enough work to say the same. So we will charge something. But the first month is free. June 2015 is free and will be free forever. Instead of the first month being free for any new sub, June 2015 will be the only free month.

Pauline has been asked to present a webinar for the IFTA (International Federation of Technical Analysts)


She’s so busy preparing for that she couldn’t get started on the archive in a meaningful way. So this month will start off with me and my Lessons. I will begin posting tonight. June 2015’s password is: vision9538 


That will be the password for any password protected post you see on this site with a June 2015 date on it. Pricing details will be forth coming. First, I want to see and show how much value one month has in it. My first post will be about drawing Fibinacci retracements and using short term trend lines to trade fibs. I have a great example in the price action of the USD/JPY pair. My twitter DM’s are open for any comments or questions regarding anything from my or Pauline’s future posts. If you’re not on twitter, sign-up, because I will not be checking the comments on posts here. Twitter has more functionality. I think that makes it more inducive to building a community. That’s what we’re trying to do here: Build a community of profitable traders by offering actionable info and educational info. So if you don’t know anything about trading you can come here and hack the learning curve. If you’re a long time trader that needs a new system or a refresher you can come here and get your fix. We’re trying to build a place where you can get info and perspectives that you can’t find anywhere else delivered in a simple, straightforward way. Time will tell if we succeed or fail. The journey should be interesting to say the least! We hope you will join us!

Thanks in advance!

Pure Technical: Are Elliot Wave & Gann Signals Pointing to an Emerging Bull Market in Gold? $YG_f #gold #trading #nerd #alert #math

by Rasool Cunningham
Chief Trading Editor
Philadelphia, PA (DYDD)

This is a re-post from Pauline Novak-Reichs facebook page, and a sample of what she’s offering starting June 1st here on DYDD. It’s pure technical. She doesn’t care about fundamentals. I love her machine like process. She’s my polar opposite. I care a lot about fundamentals. I’m a technical guy, but I’m a “price guy”, she’s a “time gal.” Not in this post, but she said “Price is a function of time, and time is a function of price.” I couldn’t agree more. But I lean more toward the price side, meaning I understand price more than time. As you will see below, she barely mentions price. Short, succinct, and valuable to people who understand Elliot wave theory and Gann theory. Which aren’t a lot of people relative to the amount of people who are like me, and love price. That’s because price is easier. Time is more time consuming and math intense. For that reason lots of people shun it, and even ridicule it out of hate of what they don’t understand. But that’s cool. I think that’s an opportunity for my girl Pauline to teach us all. She tells me Elliot and Gann are just time representations of the Fibancci concept. If you know me you know I’m also a “Fibonacci guy,” so I’m really looking forward to learning more about time analysis.

Anyway, Check her out, and stay on the lookout for more details on the upcoming Pauline Posts. Thanks!

GOLD – an emerging bull market:

The following is based on a chart I discovered at:

The period of 1492— 2001 formed the largest bear market’s Grandsupercycle known in history.

• Apr. 4, 2001 — Mar. 17, 2008, minor wave 1 of intermediate (i) of primary [I]
= 2539cd (2555 north-east)
• Mar. 17, 2008 — Nov. 19, 2008, wave 2 of (i) of [I] = 248cd (249 south)

• Nov. 19, 2008 — Sep. 5, 2011, wave 3 of (i) of [I] = 1020cd (1025 south-east)
• Total calendar time Apr. 4, 2001 — Sep. 5, 2011, = 3806 cd (3814 south) =
360º with Nov. 19, 2008 and 180º with Apr. 4, 2001
End of minor wave 3 of intermediate (i) of primary [I]
(Incomplete bull market phase)
• Sep. 5, 2011 — Jul. 17, 2012 = 316cd south
Waves 5 of 1 and 5 of c terminate at 360º
• Jul. 17, 2012 — Oct. 4, 2012 = 77cd north = 180º
• Oct. 4, 2012 — May 10, 2015 = 949cd (946 NC) = 360º
• Sep. 5, 2011 — May 10, 2015, total calendar time = 1280 (1279 South)
End of wave 5 of (a) of [I]

• Upward wave 1 of (b) of [I] is currently underway


Time Analysis, $SPX & $YM_f Levels, Why I love Trading Currencies, and the $DX_f Bounce. #FX #stocks #trading

by Rasool Cunningham
Chief Trading Editor
Philadelphia, PA (DYDD)

The $SPX is coming off new highs. One of these new highs will be the last one for some time to come. Some think trying to pick a top is fools play, and I agree, for the most part. But there is a thing called time analysis that a guy by the name of W.D. Gann mastered. I don’t fully understand Ganns system, but I know someone who does. She told me that this is a turn around time for the markets. Added to my own macro fundamental, and price analysis; I’m inclined to believe her. If this is true, and we looked at a weekly $SPX chart; these are the levels we would look for price to break first:


The 2117.66 area down to the 2110.3 area has been breached. If this areas break holds, these other levels will come into play: (this chart is from 5-18-15)


I drew these levels just by looking at recent price action. I didn’t draw a short-termed fib yet, but I’d bet some will coincide. I do have a long term Fib drawn on this weekly chart (the red line.) We won’t need those levels before these levels break.

I talked about $YM_f in a recent post. Here’s an update: Price was holding near the trend line mentioned. Here’s how it looked on May 19th:


Here’s how it looks after today’s close:


These levels mattered more: 18.270 – 18.250 – 18.227 – 18.200 – 18.159.. But now they’re all resistance.  

Looking for more downside action, but if we see new highs I wouldn’t be surprised. Sometimes price will float around above an area of resistance. We call it price overshooting. I wouldn’t be surprised if we saw new high prints because of what we call “the human factor,” or: people are capable of some pretty irrational things. We usually see how irrational it was after the fact, or in hindsight.

The trend line that’s giving $YM_f hell is upward sloping, (red trend line below) so new highs aren’t out of the question:


New highs become more, and more improbable when/ if price closes under the lower trend line that price is bouncing off now. Call it today’s low at 17,964. The bottom can fall out of this market at any moment. it can also see new highs at any moment. Very exciting times to be a trader. Very scary times to be a trader. I love it.

Currencies are my favorite instruments to trade. to me they have longer, truer trends. I don’t share much of my currency analysis in blog posts. I mostly tweet my thoughts and charts. That’s about to change. Starting June first we’re starting a service here on DYDD featuring Pauline Novak- Reich (the Gann expert mentioned above.) She will be doing a monthly premium password protected Gann analysis post. To my knowledge it is the first of it’s kind here in the U.S. The password will change every month. Under that same password I will be dropping all my best FX analysis. I’ll also throw in my my best stock and commodity work. To top it off, I’ll also be explaining how I draw Fibonacci retracements and how I use them to trade. But wait, there’s more! (haha, I like when they say that on infomercials) I’ll also be dropping macro market thoughts underpinned with Soros Reflexivity/ Fallibility theory! If you follow me on twitter you’ve seen some of my work, but here’s a sample of what you can expect:


Here’s the original picture of the $DX_f coming off that support line:


Here’s what price has done since then:


Looking for more $DX_f bounce.

In the first $DX_f picture above the 93.273 line is thicker to denote it’s importance. I’ve drawn more Fibs since then; I think they’re equally important and valuable. Starting June first I’ll be sharing it all. In combination with what Pauline is bringing to the table I think this service is going to offer a tremendous value. Pricing for this service is still being debated, but the value is un-debatable methinks. Look for an official post marking the launch of the service with full details on pricing and what’s being offered in the coming days. I’m excited to bring this to the trading community. I hope you will all join Pauline and I on this journey to help others on their travels through these markets. We can’t promise riches beyond your wildest dreams, but we can promise an honest market perspective you won’t get anywhere else!

Thanks for reading! And stay on the lookout for the new service!

P.S. Please share this!


Bulls: Calling All Chasers.. $SPX #stocks #macro

by Rasool Cunningham
Chief Trading Editor
Philadelphia, PA (DYDD)

4.4159278091The Bulls have to keep pushing higher and higher. They need to gain back the momentum lost as price range traded the whole first half of the year. It’s not easy to do, I don’t think it will happen, but it could. There is a very viable scenario where stocks go up until they blow their own tops off. If the Fed doesn’t raise rates, stocks are not only not overvalued, they’re undervalued. Because there is nowhere else to put all the money that’s been created. It could go into new construction, or business innovation, or some other productive use. It does go to those uses a little, but for the most part people don’t seem willing to put their money into any of that. They just want “safe” assets (gov. bonds.) This would say they don’t believe there are any good places to put their piece of the printed pie. This puts upside pressure on stocks, even when there should be little or none. All this money will begin to distort markets even more than the Fed intended, so the plan is to take it out before that happens.

The Fed raising rates is their way of taking that money out of the economy. This excess money in the economy starts to distort things too much if left in the economy too long. It makes people buy assets at ever more inflated prices. This in turn makes the downturn that much more severe. Or at least makes it feel that much more severe. A 20% correction from here would seem like the end of the world. It wouldn’t be, but that’s how the headline would read to the public. And at that time it would probably be a good time to buy stocks.

Right now stock bulls need chasers. They need people to buy this market at the top. This recent range trading we’ve seen all year says that’s all the bulls have been missing. People with money, that believe stock prices can go higher. Despite the fact that artificial stimulus largely caused stocks to get this high, and the fact that that stimulus is about to be put in reverse. They need people to believe that you can print your way to prosperity. At the moment, people are getting new credit card offers and pre-approved auto loan offers (I am anyway, so others are also methinks.) So it looks all fine and dandy, and it could look fine and dandy for some time to come. Again, I don’t think it will, the Fed didn’t mention a rate hike for nothing.

It’s a necessary part of the QE process. It’s like bringing the patient back from an Anesthesia induced coma. If you never bring the patient back, is it a successful surgery? No. The same can be said of the Feds’ QE. They have to take this money out of the economy so that the opportunities that lower stock/ asset prices bring can be realized. If not, the distortions like negative interest rates and astronomically high asset valuations will get worse. Lip service, or “the management of expectations” has run its course. Fed Chair Janet Yellen’s recent warnings of high stock valuations went ignored. She made this warning because the recovery is so uneven that there are actually places in the economy that need more Fed accommodation. She’d like to leave rates this low as long as needed, but stock prices could get to a level where unsuspecting people could easily be throwing money away paying too much for stocks. On the flip side of high stock valuations are the psychological effects of a crash. These effects are a great drag on the economy. This recovery is the slowest ever partly because of the effects from the last crash. The Fed wants to avoid another trip on the economic roller-coaster, or at least not have the downturn be so steep. But if stocks keep going up we should all keep our barf bags in arms reach methinks.


Price Lessons from History, $ES_f’s 2011 Trend Line Shelf-life, $YM_f @ Resistance, Crowds Fighting The Fed.

by Rasool Cunningham
Chief Trading Editor
Philadelphia, PA (DYDD)

Price is my favorite market metric. Its movements are effected by so many different variables that you will never stop learning about price. Time and Value also matter a LOT, we know this. But to me, price is more important than both; it effects everything much more strongly than either, or anything else. Price makes people act. If price is going up for a long time the time factor, or even the volume factor, won’t effect peoples decisions much. Price will over ride all else. We’ve seen this time and time again in history. One example I came across re-reading Robert Menschel’s Markets, Mobs, & Mayhem. It was about the South Sea and Mississippi Companies out of the U.K. back in the 1700’s when the U.K. was thee shit. Here’s how he started the chapter off:


My point is made clearest in the story of one man who spoke out against the companies, but wound up buying in himself and losing a lot in the crash. His name was Robert Walpole. He went on to become the U.K.’s first Prime Minister. He was presumably a smart man. A capable man. He became Prime Minister, so, a serious man. Yet, he still fell victim to a scheme he himself had warned people against falling for.

This brings me to the $ES_f trend line that is holding this market up like a champ, and has been fighting off bears at every turn. Here’s what it looks like on a weekly chart:


That large dip below the line was in October of last year when QE ended. Other than that price has held this line. If we zoom in on the weekly chart we see the fight seems to be coming to a head, and the bulls seem to be winning. Here’s how it looks:


This looks like a rising wedge breakout here. We could have a false breakout here. Or, we could have the real thing. Volume wasn’t what you’d like to see on a real breakout, but again, price matters more. This price action could get people to buy here. The question is: Are you getting a good price here? Some smart people and good traders say yes. I say no, because you don’t have a big enough margin of safety in the markets right now. Stocks are going down a lot more than they’re going up. Earnings misses get 20% hits and earnings estimate beaters get 6% pops. I can remember when it was the other way around. Still, price is king. Until price breaks this line (which will make us look for another trend line off the October 2014 lows.) bears are gonna have to be smart. They have to know how not to chase:



If you were short $ES_f from 2017 you could have, should have, booked some gains May 12. At any rate, you really shouldn’t have been shorting on that day. Postmortem learn from my mistake moment: I sold 3 contracts at 2017.50 and covered one right before I tweeted this tweet. I should have covered them all because I went on to stop out at 2018.50 with a small gain that could have been bigger. I held because of ego. I did well trading AUD/USD and USD/SEK so it felt like I could take more of a risk in $ES_f. This is true, but I have to book gains everywhere. I can’t afford to not get the largest gains I can at any given time. Us traders can’t afford to miss opportunities for good gains. But it’s spilled milk now.

So, to know when to get out of the way, or when to not chase, or when to take gains is crucial. Price gives us the clearest signals of when to do these things methinks. I look around at other indices to look for confirmation. Like Dow Theory expanded beyond Dow indices, but including Dow indices.

I like to look at the $YM_f big cap Dow Industrial Average these days. Because: big money has been going into them for a long time now, If the markets are going to go any direction at all, it will be big money that takes it there. Here’s how $YM_f looks on a four hour chart:


18,251 is resistance. A push higher from here would tell bears to get out of the way. But price needs to either got like 2% above it, float back to it and hold. Or gap up and never look back. Because a float up where price inches up above it is just a target for shorts on a bad, or good data print. Hyper sensitive markets like this move off almost anything. If price does get above it and hold it, it will be a big deal. A big move higher right through it is a bigger deal. Let’s zoom in:


We have trend line resistance right under Fib line resistance. If price shreds this area to the upside, it’s a big deal. It also tells the Fed that the crowd wants to fight. The crowd told Alan Greenspan’s Fed the same thing when he made his “Irrational Exuberance” statement.

We now know he should have been hiking rates a little bit when he saw stocks pushing higher. The stock wealth effect is so concentrated that risks outside “thee” inner circles are ignored. People automatically bought up the Greenspan situation and said:

He was wrong by two years!

But Greenspan let the world eat an extra two years too long on low interest rates. It lead to, or fueled the housing boom, and when he realized that rates can’t stay low forever he hiked in 2006; leading to the housing bust. By that time the myth of ever higher prices was set in stone in the brains of enough people to push the boundaries of ways to make credit.

None of this matters until after things have gone sour. In hindsight we see it all so clearly! Back to the big caps, though; It’s not finance twitter moving these markets (Unless you follow Carl Ichan or Warren Buffett on twitter b/c they’re big money.)  It’s big money that needs to see a good return in the near future, like, this year. But I think this will be the first down year in the stock market since 2008. I’m not big money, but I can think like big money because it’s not difficult. People want a favorable chance, or favorable odds of getting a good return this year, and I don’t see it. Not with a rate hike promised (people doubt a rate hike will come. I get it.)

But think of it this way. If the economy is creating 200k jobs a month, every month the Fed delays a rate hike could potentially lead to the creation of 200k unsustainable jobs. Jobs only created because some people, somewhere got business loans/ started business, or invested in business that will have a harder time after rates rise. The Fed changes the Fed funds rate that banks get charged. The banks and finance companies charge us a different price. That price, or rate, is floating. The market isn’t a machine the Fed can push buttons on and get the exact right outcome. Losing 200k jobs that people just got only a year or so ago is devastating to 200k people who have friends and family that see the pain. The Fed wants to avoid that. The Fed wants to slow the economy before it takes on jobs that are not sustainable. Big money understands this. People need to understand this, and be prepared for anything.

We don’t know who is swimming without trunks. Maybe everybody has shorts on, I don’t know. But I think we’re about to find out. But there are enough people who are blinded by greed, and have a lot of money to put to use; for stocks to still go higher from here. Although all year long new highs have been shorted, every time is different and must be respected differently. This time there is lots of money in the banks so it’s not Armageddon, but it is market discipline for people who took on too much risk. How many people do you think that is? I don’t know, but if people feel they have taken too much risk they will stop taking risk, and even take some risk off when they can. People who own stocks “can” take risk off right now at great prices methinks. At any rate, $YM_f will tell us everything we need to know. Give it a couple of days methinks..

Thanks for reading, good luck this week traders!

#FXblurb $USDCHF, the craziest chart in the world to me.

by Rasool Cunningham
Chief Trading Editor
Philadelphia, PA (DYDD)

The daily chart of USD/CHF is thee craziest chart in the world to me:


All the CHF pairs are crazy due to the SNB debacle. But I like USD/CHF the best because the currencies have such a stark contrast in terms of fundamentals and central bank actions, as far as rates. After the debacle I tweeted some mission impossible tweets about shorting the CHF after the snap back had begun. Price retraced almost the entire drop after the debacle! The Fibonacci retracement was good stuff, to say the least:



Now, we’re going through a price discovery phase where price builds a grid and tells us what it wants to do next from technical standpoint. Fundamentally, a lot depends on what we know about the Dollar, which is undependable right now. What we know is undependable because things are changing fast. The Dollar could be falling for too many reasons. It could firm up for too many more. But if inflation expectations are growing (rates sure are saying that) it should weaken more regardless of the fact that the Fed may raise rates, but because inflation is on the rise. The rate hike comes first, and then the strong dollar #methinks.

Thanks for reading, and I hope this was helpful.