Yesterday’s Bank of Japan meeting has been the main driver of market sentiment over the last 24 hours. The Yen has been the strongest currency performer whilst US Equity markets closed on a new 5 year high, helped by better earnings from Google and IBM ahead of tonight’s very important Apple results. The news that the Asset Purchase Programme from the BOJ was less successful than expected has seen a large move down in the USD/JPY. Just after I posted my commentary yesterday European Markets were rocked by rumours that Germany’s Bank Regulator had ordered large banks to initiate a break up between investment and commercial bank operations. This was followed by more rumours which indicated that Bundesbank President Weldman had resigned, which was subsequently denied, helping European Stocks to recover some ground into the close. European markets were also helped by a better than expected German Investor Confidence reading with the ZEW rising to 7.1 in January from 5.7 in December, but were still lower on the day.
This morning we have UK Unemployment and the BOE minutes. At 10.00am we have the Euro-Zone Consumer Confidence followed in the US by the House Price Index and MBA Mortgage Applications.
March S&P 500
Unfortunately the S&P just missed my 1474 buy level with a 1474.75 low before having a nice 17 handle rally into the close. After the results from Google and IBM the S&P rallied to my 1491 sell level and I have taken profit this morning on this position at 1486.5 and I am now flat. The reason I have taken profit is because the market is too close to the important 1500 level for it not to be challenged. It continues to trade in a very overbought manner and today I am an aggressive seller from 1495/1500 with a 1503 stop.
March FTSE
The FTSE traded up to my 6170 target profit level over night and I took a nice gain on my 6130 long position and I am now flat. Today I will look to go short the market on any rally to 6180/6205 with a 6220 stop. I will also look to buy the market on any dip to 6120/6135 with a 6105 stop.
Euro/USD
The Euro worked really well and I was able to take profit at 1.3320 on my 1.3370 short position and I am now flat. I still believe the Euro is trying to put in a top and today I am a seller on any rally to 1.3345/1.3370 with a 1.3405 stop. If the Euro breaks and closes below 1.3260 it will be short term bearish as I will then look for a test of the very important 1.3150/1.3180 support zone.
USD/JPY
Just after I posted yesterday morning the USD/JPY dropped down to my 88.40 buy level and I took a nice gain at 88.80 and I am now flat. The market does not like the weak Asset Purchase Programme from the BOJ. Today I am a buyer on any dip to 87.50/87.80 with a 87.40 stop.
March BUND
Very unlucky here as I was stopped out of my 142.80 long position frustratingly at 142.60 and I missed the ensuing 90 point rally. As I have been saying for the last 2 weeks the Bund is trying to bottom in the 142.00/142.50 support zone. Today I will look to buy the market on any dip to 143.10/143.30 with a 142.90 stop.
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