Last week feels like 2 years away. We had the Presidential debate, The President contracted Covid, Stimulus hopes, Stimulus hopes destroyed. Needless to say that Risk-On/Off has been all over the map. Let's look at one of our favorite pairs to see if we can see some actionable trades.
Looking at the chart above you will notice that volume on the down days is outpacing volume on the up-days as noted by the three white arrows. Also, we see the RSI bumping up again 50 and being rejected. Our short-term moving average is converging with the long-term average which could be a sign of a possible move lower in the next couple of days.
Presently, the price of this pair is below the rising trendline dating back to June. As long as its stays below this line, we favor short trades. With the U.S. Presidential election less than a month away, our base case is a risk-off in markets in general, at least until the election is decided.
Thanks for reading, have a great day and Happy Trading!
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