Make 2026 your best trading year ever by joining the VTP Trader Accountability Group: https://bit.ly/VTPTAG
Hello Traders,
Thanks to those of you who joined us today. I should reiterate that the Monday Market Update is just that. A big picture overview of the markets, with a few ‘charts of interest’ thrown in. There are no trade recommendations, this is not a signal service – just what I am looking at and interested in.
Today we looked at; FX STAM, the Irish Stock Exchange ($ISEQ), The Emerging Markets Fund ($EEM), UK 10 Year Gilt Yields ($GB10Y), Ondas Inc ($ONDS), Wix.com ($WIX), and Oklo Inc ($OKLO).
You can follow my charts on TradingView at FXTraderPaul: https://bit.ly/FXTPVIEW
We also covered the usual suspects: $DJIA, $NDX, $SPY, $RTY, $DAX, $FTSE, $N225, $WTI, $XAUUSD, $XAGUSD, $BTCUSD, $USD, $DXY, $JPY, $AUD, $CHF, $NZD and $GBP.
Have a great trading week.
***There will be no Monday market Update for the next 2 weeks – we will return in two weeks on Monday 1st June.***
Trade well,
Paul
https://linktr.ee/tradingbeliefs
If you’re happy with your trading methods and just want to be part of a community then join the Free VTP Skool community: https://bit.ly/VTPSKOOL
If you want help with becoming the best trader you can be, then you can join the VTP TAG – Trader Accountability Group: https://bit.ly/VTPTAG
AI Generated Key Outcomes from the session:
Key Outcomes
Paul Wallace delivers his final Monday Market Update before a two-week break, analyzing FX strength/weakness, indices at all-time highs, and key earnings plays amid volatile geopolitical conditions. Markets flip between risk-on and risk-off as Trump declines Iran’s counter-proposal over the weekend, reversing Friday’s peace deal optimism. 123
Market Strength & Positioning (STAM Model)
FX Rankings (Week 20):
- Strongest: Aussie dollar remains top, Kiwi dollar surged from bottom to second place (reflecting risk-on sentiment end of last week) 14
- Weakest: US dollar at bottom, Canadian dollar rolled over and fell away 1
- Mid-tier: Swiss franc nudged up, Japanese yen bumped on BoJ intervention comments, Euro middling, Sterling weakened from second place two weeks ago 25
Monday Reality Check:
- All major currencies weakened against USD as Trump rejected Iranian counter-offer, triggering risk-off mode 36
- Most Aussie/Kiwi pairs in STAM 1 or STAM 2 buying configurations, confirming continued strength 6
Indices:
- S&P, NASDAQ, Russell closed weekly at all-time highs 78
- Dow coiling under 50,000 level, hasn’t pushed to highs like others 9
- FTSE only major index not in STAM 1 buying; showing weakness 7
Commodities:
- Silver in strategic buying, VIX supporting bullish action, Bitcoin in STAM 2 Bravo with nice daily trend 7
- West Texas crude trading just under $100, reflecting geopolitical tension 9
Political & Economic Backdrop
UK Political Instability:
- PM Starmer delivered 30th “reset speech” (under 2 years in office) following election losses, doubling down on unpopular decisions 5
- Markets in “strange place” – Sterling shows weakness from political instability but also strength because markets fear who replaces Starmer/Reeves (quality falls off a cliff after them) 35
- Speech failed to inspire; gilt yields pushed up 1.3% today instead of drifting down 1011
Geopolitical Volatility:
- Flip-flopping between war-on/risk-off and peace deal optimism creating market whiplash 12
- Trump meeting Chinese President Xi from position of strength, potentially part of Iranian negotiating strategy 6
Charts of Interest & Earnings Plays
ISEC (Irish Stock Exchange):
- Weekly chart shows strong uptrend with bounces off 50-period MA, but topped out at 13,000 twice 1213
- Closed below 20-period MA last week (first time in 9 months); 20 turning down while 50 spinning up – coiling between the two 13
- Sensitive to ECB commentary, Euro strength, US tech sentiment (many tech companies have Irish real estate) 1314
- Banking/construction names sensitive to ECB rate expectations and eurozone growth 14
- Watch for: Catalyst to break above 13,000 or below 50-period MA 14
EAM (Emerging Markets Index Fund):
- Weekly chart on strong move, closed at weekly highs despite tariff tantrums and dollar swings 15
- Benefiting from elevated defense/energy/infrastructure spending, rebuilding in Persian Gulf, capital flows as traders price in less aggressive Fed 1516
- Risk: Stronger dollar could reverse inflows quickly and pressure risk assets 16
UK Gilts 10-Year Yield:
- Weekly at 5% level – Paul sees double top and bearish engulfing/key reversal candle (rolled over and closed beneath previous candle low) 1017
- Historical context: August-September 2022 spike driven by Trussonomics emergency budget (Truss lasted 44 days) 1617
- Current positioning: Markets lack confidence in Starmer/Reeves to deliver on promises; yields up 1.3% today post-speech 1011
- Watch for: Will 5% hold as hard level or push higher as economics wreaks revenge on politics 1118
ONDA (Ondas):
- Small-cap AI/drone/defense technology play; earnings Thursday morning 1819
- Speculative name benefiting from autonomous systems and military drone capability interest 19
- Small-cap liquidity brittle, easily swayed by sentiment swings 19
- Weekly chart: Coiled/pivoted around $10 for 2 months since early February (flew to $15, came back) 20
- Catalyst potential: Persian Gulf situation could drive volatility – war-on/risk-off pushes up, peace deal pushes down 20
WIX (Wix.com):
- Reporting this week; Paul has website exposure via Wix subscription 21
- Benefiting from AI integration, website creation automation, digital infrastructure 21
- Investors focused on margin expansion and subscription revenue rather than pure growth 21
- Software sector sensitive to US yields and NASDAQ risk appetite; guidance on enterprise spending key 2122
- Weekly chart: Strong downtrend with double bottom forming at $60; 20-period MA acting as resistance for 9 months 22
- Currently at $80 (big round number) with 20-period MA overhead 22
- Watch for: Earnings catalyst to break above 20-period MA; if so, $100 becomes magnet (50-period MA converging there); failure means drift lower 2223
OKLO (Small Modular Reactor/Nuclear):
- High-profile speculative nuclear energy/SMR theme play; reporting Wednesday evening after close 2324
- Feeds into AI electricity demand and energy security narrative 24
- Weekly chart: Paul’s first position around $20 off 50-period MA bounce; flew to $190, crashed to $50, now coiling between $70-$80 (between 20 and 50-period MAs) 25
- Lots of wicks top and tail showing volatility; expect continued volatility 25
- Watch for: Earnings/guidance as catalyst for next move; regulatory process and government support key factors 82425
Index & Commodity Technical Views
US Indices:
- NASDAQ, S&P, Russell: Weekly closes at all-time highs – “everybody’s getting green and giddy” 78
- Dow: Coiling under 50,000; hasn’t followed others to highs – watch if it follows or leads reversal 926
European Indices:
- DAX: Above weekly 20 and 50-period MAs but not inspiring; started year with double top, now forming lower high – concern about rolling over 26
- FTSE: Fantastic 2025 trend stopped by big bearish engulfing/key reversal candle; formed lower high, last week’s candle shows bearish rejection/high wave/spinning top – expect drift back to 10,000 level 2728
Gold:
- Weekly: Last couple weeks show wicks providing buying support, but ranging; not exciting 28
- Daily: 50-period MA rolled over, acting as fantastic dynamic resistance; significant level at $4,400 28
- Descending triangle potentially building with 50-period MA pushing price lower 29
Silver:
- Pushing between $70-$80; daily chart back above $80 29
- 4-hour: Pushed up last week, pivoting around $80 – reflects risk-on move (industrial demand driver) 29
Bitcoin:
- Weekly: Above weekly 20-period MA after coiling up; at $82,000 level 30
- Daily: STAM 2 Bravo; nice 6-week uptrend above 20 and 50-period MAs, now running into 200-period MA 30
- Coiling up with 200 coming down, 20 and 50 rising – awaiting catalyst or “sell in May” exhaustion after volatile first 5 months 3031
Oil (West Texas):
- Trading just under $100; lots of weekly swings; Iranian counter-proposal rejection will impact 9
FX Pair Analysis
US Dollar Index:
- Daily: Closed lower but current week showing indecision candle; nobody excited or full of vigor 32
- 4-hour: Bounced beautifully off 200-period MA, 50 acted as dynamic resistance; gapped up on Iran rejection but didn’t flow higher – waiting for Trump commentary and US market open 3233
Sterling:
- Paul executed 7 trades across Sterling pairs Monday morning (5 wins, 2 losses), all short side given daily/4-hour/sentiment bearishness 3435
- Cable: Just coiling up; no clear direction 3336
- Pound/Yen: Sat on 50-period MA – awaiting Sterling movement or more BoJ intervention 36
- Sterling weakened vs Aussie and Kiwi, strengthened vs CAD (but everyone has), weakened vs Euro, mixed vs Swiss franc 37
- Very mixed picture; no clear trend; political and geopolitical instability not filling traders with joy – tread carefully in swing trades 3738
Kiwi Dollar:
- Strengthened against USD, Euro (Euro weakness), Sterling (Sterling weakness), CAD 39
- Kiwi/Swiss franc in range; vs Aussie in range (1v2 situation Paul doesn’t trade) 39
- Kiwi strength visible across enough pairs to justify second place in STAM rankings 3639
Upcoming Events & Data
- This week: Fair bit of US data coming out; UK GDP release 34
- Active Trades webinar: Monday 2pm London time on “how to debrief your trading” 40
- Next Monday Market Update: June 1st (two-week break for travel) 3841
Risk Management Reminders
- Critical to stay on top of risk management, news flow, and order flow during volatile times with frequent sentiment swings 2
- Markets flipping between risk-on and risk-off; expect continued volatility over next 24-48 hours as US markets price in weekend developments 27
Paul’s Trading & Resources
- STAM model (Strength, Trend, Momentum) updates every 4 hours for Stage 2 VTP members; helps prioritize time, energy, resources 434
- VTP Trader Accountability Group available for discipline, accountability, consistency building 40
- Monday Market Update is not signal service or trade recommendations – Paul sharing his watchlist for educational purposes
May 11, 2026
0 Comments