Not much change since yesterday. The Fed’s ‘Operation Twist’ extension and the promise of more QE later has switched market attentions to the next instalment of Europe’s economic saga. The Fed extended the duration of asset purchases until the end of the year, which initially disappointed the markets, but then Bernanke said they would do more if conditions deteriorated and risk markets rallied again. Greece formed a new government with Samaras as PM. The negotiations are likely to come after the Troika visit in July so things should calm down on that front for a while. Today all eyes will be on the ECB to see whether they will cut rates. Later at 1.30pm we have the Weekly Jobless No’s from the US. In other news, ECB member Soeure says ESRF should buy secondary market Sovereign Debt, Merkel says it is not being discussed but may be possible.
Sept S&P 500
The S&P just missed my 1357 sell level as the high was 1356. I am still flat and today I will look to sell from 1353/1358 with a 1361 stop. The 1360 is a crucial level for the Bulls. I do not want to be long as we are very overbought and I don’t want to chase the market down so I will wait to see what the ECB does first.
Euro
I am still flat the Euro which has had a very narrow range over the last 24 hours. 1.2570/1.2600 is good support and 1.2750 is strong resistance and we need a break of one of these levels to get the market moving. Today I will use these levels and I will look to buy from 1.2580/1.2610 with a 1.2560 stop. I will also look to go short from 1.2720/1.2750 with a 1.2770 stop.
Sept Bund
I was stopped out of my 141.00 long position at 140.65 yesterday. I still like the Bund and I have gone long again this morning at 140.70 with a 140.40 stop. I will look to take profit from 141.40/1.4160.
Sept FTSE
I sold the FTSE yesterday at 5570 and as we did not close over 5590 I am still short. We are very overbought and a the top of the Bollinger Band and I will leave a 5580 stop on this position. I will look to take profit on any move back to 5480/5500.
August Crude
I have not mentioned Crude for a few days but the market is well lower this morning. As we are way oversold I want to go long from 79.60/80.10 in small size with a 79.10 stop. If I am taken long I will look to take profit in front of 81.50 which is a strong resistance level.
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