Intraday Market Thoughts

Archived IMT (2010.10.25)

by Ashraf Laidi
Oct 25, 2010 1:53

THE 1st PART OF THE G20 came and went as Finance ministers agreed on the notion of setting maximum targets on current account surpluses/deficits, but neither sign of what is too excessive nor how it will go about it. We already know IMF economists view 6% as the ceiling for current account imbalances, beyond which it deems as unsustainable for economies and currencies. G20 leaders will emerge on Nov 12 and announce whatever agreements their Fin Mins have ironed out. TIME TO LEAVE THE G2 NOISE behind us for now and focus on the role of US EARNINGS in driving S&P500 towards the 1200 target, especially that the Dow-30 has broken well above its 200-week MA. This could further reward AUDUSD towards parity, but I continue to see EURUSD resistance at 1.4050-80s. Yet my bearishness on GBPUSD and GBPJPY remains as we approach Tuesdays release of UK Q3 GDP, expected at +0.4% q/q from 1.2%. Just like I warned you last Sunday about an austere week for GBP, I am doing the same this week based on these GDP figures. Charts and analysis of GBPUSD is in the HotChart titled GBP Inflection Point?


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