News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
Wall Street
Bearish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
More View more
Real Time News
  • Looking for a new way to trade reversals? One of the most used reversal candle patterns is known as the Harami. Like most candlestick formation patterns, the Harami tells a story about sentiment in the market. Get better with trading reversals here: https://t.co/rfwUWJfbz9 https://t.co/Q3Yfe6TMLw
  • The non-farm payroll (NFP) figure is a key economic indicator for the United States economy. It is also referred to as the monthly market mover. Find out why it has been given this nickname here: https://t.co/yOUVEEqhc5 https://t.co/6inC94w5K4
  • All eyes on the Fed on Wednesday as investors weigh on chances of a taper announcement. Get your weekly equities forecast from @HathornSabin here: https://t.co/Cv06XcvldF https://t.co/I12g2YPkdE
  • Knowing how to accurately value a stock enables traders to identify and take advantage of opportunities in the stock market. Find out the difference between a stock's market and intrinsic value, and the importance of the two here: https://t.co/QszmdZFxlk https://t.co/KsPiWBysiR
  • GDP (Gross Domestic Product) economic data is deemed highly significant in the forex market. GDP figures are used as an indicator by fundamentalists to gauge the overall health and potential growth of a country. Learn use GDP data to your advantage here: https://t.co/Yl9vM7kO6a https://t.co/iUvhLfQgcK
  • The US Dollar caught a bid in the late part of last week to set a fresh September high. FOMC is around the corner, are bulls going to be able to push for another fresh high? Get your weekly US Dollar forecast from @JStanleyFX here: https://t.co/ZkDHyV1VhM https://t.co/w5sPChKdNx
  • The Federal Reserve System (the Fed) was founded in 1913 by the United States Congress. The Fed’s actions and policies have a major impact on currency value, affecting many trades involving the US Dollar. Learn more about the Fed here: https://t.co/ADSC4sIHrP https://t.co/bde30KM8OE
  • The Australian Dollar remains vulnerable to most of its major counterparts, with AUD/USD and AUD/JPY resuming losses. Did AUD/NZD bottom? AUD/CAD may consolidate. Get your weekly Australian Dollar forecast from @ddubrovskyFX here: https://t.co/sjh91mjtXs https://t.co/dGT067zKnH
  • Technical analysis of charts aims to identify patterns and market trends by utilizing differing forms of technical chart types and other chart functions. Learn about the top three technical analysis tools here: https://t.co/KDjIjLdTSk https://t.co/VLZQhrQTAf
  • The ISM manufacturing index plays an important role in forex trading, with ISM data influencing currency prices globally. Learn about the importance of the ISM manufacturing index here: https://t.co/Xr3xtoFpZy https://t.co/j5xDAG6LLb
S&P 500: August and the Beginning of Rising Volatility

S&P 500: August and the Beginning of Rising Volatility

Paul Robinson, Strategist

What’s inside:

  • August kicks off the beginning of the most volatile three-month period of the year, however...
  • August can still be a tough month as volume is often low without a catalyst
  • S&P 500 working on breaking its historically tight trading range

Today kicks off the first trading day of the month, and also the beginning of what has historically been the most volatile three months of the year. We pointed out recently that volatility hasn’t been this low in quite some time and that the CBOE Volatility Index (VIX) not long ago hit the lowest levels since August 2014. Not only should it pop sooner rather than later, but the general level of volatility is set to rise between now and October. Since 1950 – August, September, and October rank as 3,4, and 1, respectively, in terms of the average level of volatility in the S&P 500.

This is the good news. The bad news?

Trading in August can be difficult, because just as volatility is set to begin rising, volume tends to slump during the month as summer unwinds and people enjoy the last of the summer vacation months. This is generally the case barring a major catalyst, such as last summer’s swoon on fears stemming from China. So keep in mind, while volatility is on the verge of rising, we will want to reserve our excitement if the market doesn’t have a good reason to move. But, with that said, if you are in front of your screens then you need to stay alert and ready to act even if the market action at the immediate moment is ‘boring’.

On Friday, we noted the historically small trading range, and that we need to be careful not to get caught into any traps once it moves out of the range. In overnight trade the S&P moved above the top-side of the range set at 2174/78, but is now falling back to retest. A hold here will be important as a drop back inside will increase the likelihood of seeing a move to the low-end of the range in the 2155/60 area or worse.

Be mindful the market could whipsaw as it breaks the extended range, and shakes off the rust. Traders may want to wait until the market clearly extends away from the range with momentum before becoming involved at this time.

S&P 500: August and the Beginning of Rising Volatility

Learn more about how to utilize technical analysis with one of our many free trading guides designed for traders of all experience levels.

---Written by Paul Robinson, Market Analyst

You can follow Paul on Twitter at @PaulRobinsonFX.

He can be reached via email at instructor@dailyfx.com with any questions or comments.

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES