European and US Equity markets dropped after Treasury Secretary, Tim Geithner warned that failure to raise the Debt Ceiling would impose severe economic hardship. US Government borrowing limits may be breached as early as next month unless Congress raises the Debt Ceiling.The big move overnight is the rebound in the Yen after comments by Japan’s Economy Minister Amari stoked speculation that the nation won’t try to further weaken the currency. Amari said that if the Yen excessively weakens it would cause a spike in import prices which would have a harmful effect on peoples livelihoods. European Equities were not helped by Euro-Zone Industrial Production which fell 0.3% in November and – 3.7% on a year ago. There was no US data yesterday.
This morning on the economic front we have German GDP and in the UK we have PPI and CPI. Later in the US we have Retail Sales and PPI followed at 3.00pm by Business Inventories. The Fed’s, Plosser is also due to speak this afternoon.
March S&P 500
It is amazing with Apple Shares closing on a new low and below the low made on November 16th when the S&P was trading at 1340 that the S&P today is at 1462. I am beginning to think this market is running out of steam and having been long for more or less the last 2 months I am starting to change my tune. I was stopped out of my 1466 long yesterday at 1461 and I am now flat. Today I am a seller from 1461/1465 in small size with a 1473 stop. I do not want to be long at this time.
USD/JPY
At last the Bollinger Bands and Williams Index kicked as USD/JPY is 80 points lower this morning on comments from Amari. After I posted yesterday the USD/JPY traded up to my 89.60 sell level and I have taken a nice profit here this morning at 88.80 and I am now flat. This morning I am a seller again on any rally to 89.20/89.50 with a 89.75 stop.
Eur/USD
The Euro also traded up to my sell level and I went short yesterday at 1.3390. I think this Euro is way overvalued here and I am going to try and hold this position. I will leave my stop the same at 1.3420 and I will look to take profit on any dip to 1.3320.
March BUND
The Bund also worked well yesterday, as after I posted the market dropped to my 142.58 buy level. I have taken profit here this morning at 143.10 and I am now flat. Today I am a buyer on any dip to 142.60/142.85 with a 142.50 stop on any long position. I do not want to be short at this time.
March FTSE
The FTSE dropped down to my 6060 buy level and I am long here with a 6040 stop. I will look to take profit on any move back to 6075 and I will also look to go short from 6075/6090 with a 6105 stop.
Recent Comments