MBO Issue 36 (Dec 2014) There Is A First Time For Everything
By Lawrence- Review
- Euro Facing 2012 December All Over Again
- S&P May We Live In Interesting Time
- Gold Potential Spring In The Making
- Big Picture Summary
Review
Euro struggled to form a bottom spending all month fighting to hold the 1.24-1.26 zone.
My bullish view of another week pushing higher materialized and helped S&P cleared the long term lower resistance zone. Since then S&P drifted higher towards its high resistance zone as of month end.
Gold broke lower and currently in the process of testing the original support zone (now strong resistance) from below.
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Comments
Speaking of volatility….Like someone turned on a switch this week, HSI volatility has been extreme right from the start on Monday when the opening minute did a near 450 tick range. It has been consistently high every day this week and the normal intraday seasonality has disappeared. Daily volumes have swelled with HHI doing more than 50% higher daily volume than HSI – times have changed and HHI is becoming the more liquid instrument on a consistent basis now.
Getting filled on any sort of breakout (even minor 1min chart breakouts) hurts a lot as the book gets swept so fast you cannot get a fill often even with a 5 tick slippage allowance. HKFE only has native stop limit orders so every other order type is simulated by the broker.
I do find it odd as to why the instant and persistent change of character happens and wish I understood why. Not understanding it does leave me in a slight state of confusion…
It was mainly caused by the central banks actions vs. the normal book closing activities in Dec. It will carry into 2nd week of Dec and likely settle down after as holiday mode kicks in.