Intraday Market Thoughts

More Spanish Doubts, Homes Sales Next

by Adam Button
Sep 26, 2012 14:28

Spanish GDP to continue falling; Greek 24 hour strike; UK CBI sales rose; Italian auction. German CPI; US new home sales and oil inventories are next. EURUSD, USDJPY, AUDUSD, GBPUSD, gold and silver trades from Monday's Premium Insights are in progress. See below for details

USD consolidated Asian session gains in the ongoing session. European equities are losing over 1.5% and the relative strength winner is GBP while EUR lags.

Spanish 10 year yield continues to push higher, currently around 6.01%. The rise is attributed to Bank of Spain monthly bulletin that suggest that GDP continued to fall in Q3 at significant pace. Meanwhile in Greece a 24 hour national strike to protest against reforms and budget cuts in under way today. The government is expected to announce these in the days ahead. EURUSD trades heavy near session lows around 1.2865.

UK CBI realized sales rose in September to 6 from previous -3 as retailers reported rise in sales volume along with expectation that growth will strengthen next month. EURGBP is under pressure, trading around 0.7945.

German CPI is still being collected and final result should be announced at 8:00 am ET. Most states that already published results saw annual inflation rate easing to 2% or even below. General consensus is for CPI to slow to 2.0% from 2.1%.

Italy reached a full take up as it sold 6 month BOT totaling EUR 9 bln. The average yield declined to 1.503% from 1.585% but cover fell to 1.39 from 1.69. Italian 10 year yield rose to 5.18%.

The upcoming session will bring new home sales due at 10:00 am ET that are anticipated to rise in August to 380K from previous 372K. Considering how much oil prices have fallen over the past week (WTI currently around 90.70) traders will take clues for the next move from crude oil inventories that are due at 10:30 am. The inventory is expected to shrink to 1.7M barrels from last week's 8.5M barrels.

Monday evening's Premium Insights test the efficacy of integrating medium term oscillators into short-term momentum changes. These are show in the 3 charts of EURUSD (Monthly) and GBPUSD (Weekly & Monthly). Direct access to trades, charts and rationale can be found directly in here: Non subscribers can join here:



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