Global growth concerns have accelerated following Fridays almost universally poor economic data, the highlight of which were the US Payroll Numbers . FX moves have been relatively limited compared to the weak Equity and Commodity markets with Bond Yields at all time lows in Germany and the US. FX markets may be lagging as they await a policy response to the weak data. A wholesale global easing cycle is a possibility but from current levels it is difficult for the G10 to do a great deal. The USD is subdued under the threat of QE and GBP is hesitant, awaiting more asset purchases. This is a week filled with Central Bank meetings and all eyes will be on the the ECB on Thursday to see if they cut rates. Spain just released better than expected Jobless No’s and the UK is closed until Wednesday for the jubilee celebrations.
June S&P 500
The S&P did indeed break and close below the very important 1290 level on Friday after Non Farm Payrolls. I did not trade the S&P on Friday as it is very difficult to short when you have a big gap down after important economic data. Today the market is off again as it looks to close the gap left from New Years Eve at 1253/1260. I want to buy in this area with a 1249 stop. The market is very oversold but as we have seen with oil we can get more oversold. I will only go short on a move back to 1285/1290 with a 1293 stop.
June Cable (USD/GBP)
The Cable worked out great on Friday as we tested the 1.5295 level twice before rallying all the way to 1.5440. I took nice profit here and I am now flat. The market is still oversold and I will buy from 1.5310/1.5350 with a 1.5280 stop.
June Euro
The Euro came very close to having a key day reversal as we traded down to 1.2290, after the economic data, before rallying back to 1.2450. I bought the Euro here on Friday at 1.2400 in small size and I will leave a 1.2350 stop. A break of 1.2450/1.2480 will be short term bullish.
June Gold
Gold had a huge move up on Friday and just missed my 1540 buy level with a 1545 low before trading all the way to 1630. The 1600/1610 is crucial and I will buy any dip to this level with a 1590 stop.
June DAX
I have not mentioned the DAX for a long time as I have found this market very difficult to trade over the last few weeks. The Dax is very oversold and outside its Bollinger Band and I will look to buy in small from 5920/5960 with a 5880 stop. If I get into this long trade I will look to take profit from 6020/6050.
Recent Comments