Markets, having been very quiet yesterday on the back of the Veterans Day Holiday, are a lot weaker this morning on European woes and the 0.9% contraction in Q3 GDP for Japan. At the latest summit in Europe EU Finance Ministers have given Greece until 2016 to cut its deficit to 2% of Gross Domestic Product and they have put off until next Tuesday a decision on how to cover additional Greek needs of as much as €32 billion and left unclear
whether the IMF will continue to contribute. The head of the IMF, Christine Lagarde, took issue with a decision by the EU Chiefs to postpone the goal of getting Greece’s debt down to a sustainable level of 120% of GDP by two years until 2022. Largarde said that debt sustainability has to be measured in 2020.
Of more concern on the macro front today will be Germany’s ZEW Survey due at 10.00am. This data has been disappointing of late and the current situation is expected to soften further. Before the ZEW is released we have CPI and PPI from the UK followed later in the US by the NFB Small Business Survey and the Monthly Budget Statement.
Dec S&P 500
After a very quiet day yesterday the S&P is a lot lower this morning on the Geek funding news. It has entered my buy level and I have gone long a third of my normal size at 1367 and I will look to buy the rest from 1361/1365 with the same 1356 stop. We now have a nice Gap down from last nights close and I will look to take profit from 1374/1378. If we break 1356 the next big support comes in at 1341 and I will be an aggressive buyer from 1340/1345 with a 1336 stop. I am looking for the market to bottom between 1335 and 1360 before we have our year end rally.
Dec FTSE
The FTSE has also entered my buy level and I have gone long at 5710. I will leave a 5680 stop on this position and I will look to take profit in front of 5750.
Dec DAX
The Dax has dropped into my buy zone and I have gone long in very small size at 7110. I will leave my stop the same at 7050. I have only a small position due to the ZEW Survey which is due at 10.00am. I will look to take profit from 7145/7165.
Dec BUND
Despite the weak equity markets, the Bund is struggling to go up and I will adjust my sell level this morning to 143.60/143.80 with a 144.05 stop
Euro/USD
The Euro continues to fall and is now very oversold and at the bottom of its Bollinger Band and Williams Index. I will leave my buy level the same as yesterday from 1.2640/1.2660 with the same 1.2620 stop. If I am taken long I will look to take profit from 1.2700/1.2730 which is now resistance.
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