Intraday Market Thoughts

Archived IMT (2010.09.20)

by Ashraf Laidi
Sep 20, 2010 19:07

S&P500 RUNS AWAY WITH IT, breaking well above the previous resistance of 1131-2 while pushing farther away from its 200-day MA of 1120. So what next? 1140 is the 61.8% retracement of the decline from the 1220 high (Apr 26) to the 1012 low (Jul 1st). But is this enough? WEEKLY OSCILLATORS are firmly pointing towards upcoming advances, which makes 1140 a temporary barrier before moving onto the 1155-58. How could such a positive scenario for stocks be interpreted alongside the Feds actions? Perhaps a decision to not announce any QE2 tomorrow would be interpreted as the central bank is not in panic mode. With a little help from the US data and say acceptable bond auctions, all of these could trigger fresh rallies in equities as well as EUR. On the auction front, Greece & Irelands auctions are on Tuesday (Greek 13-week T-bills and Irish 4-year & 8-year IGB), while Portugals auctions are on Wednesday (4-year& 10-year OT). So for equity bears expecting stocsk to have topped out at 1130s, be careful for a run-up to higher levels based on the aforementioned scenarios. The forex implications could well likely be lower USD (mainly against CHF, CAD and AUD), while EUR would have to retest 13240s to convince us of any tangible comeback. Yet, support seen standing at 12920s. Today's GBPCAD is already 90 pips in the money w/ more details found here


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