US markets were little changed yesterday taking a breather after the strong rally in recent days and ahead of the key central bank meetings and economic data later this week. But European markets continued their gains amid ongoing speculation that the ECB will take action to ease the debt crisis and largely dismissing the weak economic numbers that came out yesterday. Eurozone confidence figures were dismal. The Business Indicator fell from -0.95 to -1.27, leaving this indicator the weakest since 2009. The fall in the broader Confidence Index is consistent with a quarterly GDP contraction of around 1%. Spanish GDP fell 0.4% in Q2. In the US, there was another weak indicator with the Dallas Manufacturing Index falling to -13.2 in July.
Later today, we have a lot of US news with the Employment Cost Index, Personal Income, Chicago Purchasing Managers Survey and Consumer Confidence reports all due. However this data will probably be largely ignored ahead of the Fed meeting announcement tomorrow.
Sept S&P 500
The S&P worked well as we dropped into my buy zone with a 1376 low. I went long at 1377 and took profit at 1384 with 1387 being the high before we traded back down to 1377. I am flat now and I will use any weakness to 1375/1379 to go long with a 1373 stop. Again if I see 5-7 handles I will take profit as I want to be flat ahead of the Fed announcement tomorrow.
EURO/USD
The Euro is lower despite all the speculation around ECB and ESRF bond purchases and their promise to do what it takes to support Europe. I was stopped out of my 1.2260 long at 1.2235 and I am now flat. I am going to stay flat as I have no great feel ahead of tomorrow’s Fed meeting and the ECB meeting on Thursday. If the market manages to trade back to 1.2370/1.2400 I will go short with a 1.2430 stop but ottherwise I will leave the Euro alone.
USD/JPY
Unfortunately this currency pair could not sustain any rally and I was stopped out of my .7820 long for breakeven and I am now flat. Today I will look to go long on any weakness back to the .7750/.7780 with a .7740 stop.
EURO/JPY
Similarly I will look to go long any weakness in Euro/JPY back to the .9520/.9560 with a tight .9495 stop.
Sept DAX
The DAX is still at the top of its Bollinger Band but not its Williams Index and I will leave my sell order the same at 6820/6850 with a 6870 stop. Despite the really weak economic news from Europe, the Dax refused to go down and that is why I am leaving my sell order above the market. Again, given the importance of Wednesday and Thursday I want to be flat ahead of the these very important meetings as their outcomes will determine a lot of my trading decisions going forward.
Silver
Silver has finally had a large breakout and I want to go with this momentum. The 27.70/28.00 which has capped Silver for the last 6 weeks has been breached and I want to go long from 27.90/28.30 with a tight 27.65 stop as I look for a move back to the 30.00 level over the next few weeks.
Recent Comments