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Posts by "stationdealer"
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This pair has now stalled twice at the big 50% retracement level around 72 and there is the possibility of a double bottom forming on the daily chart. In order to do this it will need to break and hold above 75.50, which might prove difficult in the current bearish environment. Nevertheless, the seeds of doubt have been sown and buying dips in the very short term might prove a fruitful strategy. Support levels on the hourly chart start at 73.60 (50% and TL), 73.25 (61.8%), and 73.00 (hourly lows). Initial resistance is at this mornings 75.05 high with 75.50 behind there.
US equities open on lows, recover for most of session
S&P Case Shiller home price index flat in March
US consumer sentiment rises strongly, to 63.3 from 57.7
ECB rumored to be preparing for 50 bp rate cut
North Korea severs relations with South Korea
Obama calls for nearly $200 bln more in stimulus
Geithner to advise European officials to perform bank stress test: CNBC
Greece announces privatization plans
Three Fed districts asked for discount rate rise in April
Feds Bullard: Expects bond purchases to be unwound over five year period
US equities pare losses sharply in US trade, recover all of 3% drop. US bond yields rise from trend lows as stocks reverse. 10 year note reaches 3.07% intraday, end at 3.17%
Markets were in turmoil when the US walked int he door this morning. Spanish banking jitters had triggered another round euro selling and concerns over banking woes were heightened enough for the market to entertain rumors that both the Fed and ECB would enact new liquidity facilities while talk of an ECB rate cut of 50 bp made the rounds late in Europe.
US markets bottomed almost as soon as they opened and the euro began to lift off lows early on. Buyers were seen in the 1.2180s, keeping EUR/USD just north of the London low at 1.2177. Short-covering accelerated as EUR/USD moved above the 1.2240 level and prices really never looked back. We reached the 1.2340 area late in the day as US shares turned positive. Trendline resistance on the short-term charts around 1.2335 and talk of Chinese sales into strength helped to slow the momentum of the powerful intraday bounce.
USD/JPY recovered sharply as well, triggering heavy stop-loss buying from short-term specs when we moved back above the 90.00 level; 90.25 as the late session high. EUR/JPY was turbo charged, rising from 108.83 during the US morning to end at session highs of 111.30.
Cablle, AUD and CAD all rebounded along with the euro late in the day but cable lagged as EUR/GBP rebounded from its early slide. The cross ends at 0.8573 from 0.8508 lows.
Ratings agency Fitch says that global credit default swaps are being driven wider again by the European debt crisis. CDS widened 12.8% last week despite recent European actions, they say in a report.
EUR/USD is getting a short-covering lift at the moment after the talk of a stress test for European banks. It worked in the US, so markets suspect it may work in Europe. Well reserve judgment on that.US banks raised hundreds of billions in fresh capital after the banking crisis; European banks have done much less of that.
EUR/USD traded up to 1.2290 and trades now at 1.2277. Small stops are seen above 1.2300 as stocks trim losses.
Feds Bullard: Not Ruling Out More QE, But Not Seeing It
If the US economy got into another bad downturn the Fed could conceivably do more quantitative ease, but St. Louis Fed president Bullard, a relative hawk, does not see that. He sees QE being unwound over the next five years, which he calls a reasonable time frame.
Anyone want some of the Feds mortgage-backed securities?
2-Year Notes Sell At 0.769%; Bid To Cover 2.93
Not a great auction but in turbulent times investors may prefer to buy on their own terms rather than to take what they are given at the auctionMarkets already have tons of bonds on board
Stock Rebound Sputters
Not sure if the lackluster 2-year note auction is hitting stocks or were just selling off after an intraday bounce sputtered.
The S&P is down nearly 2% again. Weve lost a quick 6-8 S&P points in the last 30 minutes or so.
EUR/USD has dipped back to the 1.2271 level, EUR/USD has steadied at 89.85.
While Greece Announces Privatization Of State Owned Firms
Greece will start the privatization process for a state nickle producer, state-owned railways and real estate. They look to sell gas and water companies as well as the Athens airport down the line, Reuters reports. No word on whether any of the Greek Isles are on the block
Three Little Fed Districts Wanted To Hike Discount Rate In April
Minutes of the discount rate meeting which is held every two weeks showed that Dallas, Richmond and St. Louis all wanted a hike to 1% from 0.75% last month.
European contagion will postpone any hike, but if markets stabilize, it looks as though pressure for higher rates from within the Fed is building, a long-term plus for the dollar.
Says ECBs Current Monetary Policy Stance Is Appropriate
BRUSSELS (MNI) Avoiding a vicious cycle is the biggest challenge
facing policy-makers, and that is the key aim of the bold measures taken
recently, European Central Bank Governing Council member Ewald Nowotny
said on Tuesday.
The big challenge is to prevent a vicious circle, he said, adding
that the bold measures should be seen exactly as a way to avoid such a
vicious cycle.
We have been able to prevent a meltdown of the world economy,
Nowotny told delegates at a conference here.
The ECB slashed interest rates and deployed a range of
unconventional measures to help shore up the Eurozone economy during the
financial crisis, including generous lending and buying bonds on the
secondary market.
Some market-watchers say the most recent round of extraordinary
action, particularly the purchase of government debt, has dented the
central banks credibility and undermined the perception that it is
politically independent.
Nowotny said the ECB was a fiercely independent central bank.
From our point of view, our present monetary policy stance is
appropriate, he said, adding that the central bank wasnt engaging in
any form of quantitative easing, because it was sterilizing its
purchases of government bonds.
Nowotny also highlighted the challenge facing Europes public
finances.
In general, the good times were not used to build up reserves for
the bad times, he said, and this is something that has to be taken up
now.
This has been an important pair to watch over the last week or so and there might be more to come. If a move is almost vertical in either direction, I find there to be an increased liklihood that the 38.2% retracement will suffice. That level is 1.4870 and that was the overnight low. If a low starts to form near there then I expect another short-covering squeeze towards 1.5600 approximately.
AUD/USD has just made a fresh low for the year at 0.8066 and is now down 200 pips for the day. The pair in line with EUR/USD has shown no inclination to bounce which suggests that selling is consistent whilst buyers are simply not interested. The hourlies technical readings are oversold but everything else points to further downside.
A break of 80 cents looks a no brainer in this environment. The trouble with these markets is that nobody has any idea where the bottom is so they wont step up to the plate this exaggerates moves but that is the market we are in at the moment.
For those expecting the currencies to hit the "teen's" or "below 80" on Aussie with in hours or couple of sessions, let me assert here, risk to downside is limited and capped at 12180 and 8080 on Aussie. We might see one or more further dip as it would give opportunity to buyers in new options. While liquidity continues to reduce on defaults I suspect and have a pretty good guess, that Hedge funds, brokers, and most financials will sell Gold contracts and assets to gain margins, take profits and add liquidity to their portfolios in-order to go back into the market with buy backs, to show profits in their 3Q into 4Q where growth will be reflected back in form.
Dow futures are showing a 260 point loss whilst the S&P is down 33 points. European bourses are also extending their losses the CAC is down nearly 4% whilst both the Dax and FTSE are down over 3%.
Liquidity remains very low Libor still extending ask risk in financial markets remain high. And i stress again this is only a financial problem, do not confuse it as a economic problem. Wall Street brokers will remain busy today, have all their good clients today buying, and I wont be surprised if they get them start buying into Financials again, that might lift confidence for the financials and if they see this they will definitely not take another chance for turn around and will cash their Gold to raise some leverage and continue to gain all time trading contracts. I mean obviously they certainly dont want to wreck a market that's giving great business and all time new records of buyers/sellers. To hold competition within the market is a greater positive for financials, in order to continue making money and keep business alive.
This has been an important pair to watch over the last week or so and there might be more to come. If a move is almost vertical in either direction, I find there to be an increased liklihood that the 38.2% retracement will suffice. That level is 1.4870 and that was the overnight low. If a low starts to form near there then I expect another short-covering squeeze towards 1.5600 approximately.
AUD/USD has just made a fresh low for the year at 0.8066 and is now down 200 pips for the day. The pair in line with EUR/USD has shown no inclination to bounce which suggests that selling is consistent whilst buyers are simply not interested. The hourlies technical readings are oversold but everything else points to further downside.
A break of 80 cents looks a no brainer in this environment. The trouble with these markets is that nobody has any idea where the bottom is so they wont step up to the plate this exaggerates moves but that is the market we are in at the moment.
For those expecting the currencies to hit the "teen's" or "below 80" on Aussie with in hours or couple of sessions, let me assert here, risk to downside is limited and capped at 12180 and 8080 on Aussie. We might see one or more further dip as it would give opportunity to buyers in new options. While liquidity continues to reduce on defaults I suspect and have a pretty good guess, that Hedge funds, brokers, and most financials will sell Gold contracts and assets to gain margins, take profits and add liquidity to their portfolios in-order to go back into the market with buy backs, to show profits in their 3Q into 4Q where growth will be reflected back in form.
Dow futures are showing a 260 point loss whilst the S&P is down 33 points. European bourses are also extending their losses the CAC is down nearly 4% whilst both the Dax and FTSE are down over 3%.
Liquidity remains very low Libor still extending ask risk in financial markets remain high. And i stress again this is only a financial problem, do not confuse it as a economic problem. Wall Street brokers will remain busy today, have all their good clients today buying, and I wont be surprised if they get them start buying into Financials again, that might lift confidence for the financials and if they see this they will definitely not take another chance for turn around and will cash their Gold to raise some leverage and continue to gain all time trading contracts. I mean obviously they certainly dont want to wreck a market that's giving great business and all time new records of buyers/sellers. To hold competition within the market is a greater positive for financials, in order to continue making money and keep business alive.