NO doubt RBA Governor Stevens would have a wry grin with the partial pull-back in the US Dollar yesterday with the AUD/USD the best performer among the majors popping back above 0.74 and where it sits this morning. It’s been an orderly 24 hours, bereft of economic news of note. Equities have been lower on both sides of the Atlantic, the Dow weighed down by IBM (-5.9%) and United Technologies (-7%) on revenue disappointments and revised down earnings expectations.
For anybody following my New Platinum Service it made 130 points yesterday and is now ahead by 1350 points for the month. Last month it generated a total of 3045 points.
In FX, the US Dollar was as expected the loser for once, the AUD out-performing despite somewhat lower AUD-related Commodity prices: Iron Ore prices eased somewhat (-0.55%), as did LME Copper (-0.46%), with Gold opening weaker, rallying back somewhat for most of the day only to relent back below $US1,100/oz, down 0.7% for the session. All of that was pretty much a side-show, as were the repeated comments in yesterday’s RBA Minutes that “further depreciation seemed both likely and necessary” (that saw the briefest of pull-backs in the AUD) to a painful squeeze down in the US Dollar. Against those now all too familiar comments on the AUD that saw the briefest of knee jerk dip in the AUD, the currency recovered, yesterday’s Minutes revealing a more positive official tone on the domestic economy, including the stabilisation in the Unemployment Rate over recent months.
There did not seem to be any particular trigger for the partial pullback in the US Dollar. It started roughly an hour after London’s open, picking up pace during the afternoon session, with the AUD/USD the big mover, up 1.45% at its peak. Bear in mind that the US Dollar has given back 0.5% after rising 3.9% from its 18 June low. The US Dollar lost ground against the CHF, the EUR, and the NZD was of course already bucking the trend over the prior 24 hours, rising an additional 0.75% yesterday as traders likely took the opportunity to book some profits ahead of the RBNZ announcement tomorrow morning. USD/JPY fell 0.55%. Sterling was steady against the USD, the GBP losing ground against the AUD (-1.45% at its 2.09 lows for the GBP/AUD, (likely a delayed “Lord’s” effect) and against the EUR with EUR/GBP closing 1.2% and back over the key .70 pivot point.
This morning on the economic front we have the UK Bank of England Minutes at 9.30 am. This is followed at 10.00 am by Euro-Zone First Quarter Government Debt/Deficit. At 12.00 pm we have the US MBA Mortgage Applications, followed by the FHFA House Price Index. Finally at 3.00 pm we have Existing Home Sales.
September S&P 500
The S&P was lower for most of the US Trading Session which saw me go long the market at 2109. This position looked good as the market rallied nicely into the close. However shortly after the markets re-opened both the NASDAQ and S&P got hit on the release of Apple’s results. Despite the fact that they beat expectations the market is selling off on these results. I am still long and I will leave my stop the same at 2102 on this position. If I am stopped out of this trade I will use my 5 Handle Rule’ to go long again with a stop below whatever new low is printed. I will also lower my sell level to 2120/2125 with a 2128 stop.
EUR/USD
My long 1.0845 Euro position from last Friday finally worked out yesterday with the market having a nice 100 point rally as yet again the Bollinger Band and Williams Index proved what a vital technical indicator that they both are. However I covered my position too early at 1.0880 as outlined earlier to my Platinum Members and I am now flat. Today I will again look to buy the Euro on any dip to 1.0850/1.0880 with a 1.0825 stop. I still do not want to be short the Euro at this time.
September Dollar Index
The Dollar is still having difficulty in clearing the now key 97.70/98.20 resistance area. Yesterday the market had a nice sell-off which enabled me to cover my 98.20 short position at 97.95 and I am now flat. Today I will again be a seller on any rally higher to 97.70/98.10 with a 98.40 stop.
September DAX
Thankfully I had no buy level in the DAX yesterday with the market getting slammed for over 260 points from Monday’s highs and I am still flat. Technically the market had a poor close with the DAX trading back below the key 11600 pivot point. Today I will lower my sell level slightly to 11670/11720 with an 11770 stop. My only interest in buying the DAX is on a dip to 11380/11430 in small size with an 11340 stop.
September FTSE
My FTSE plan worked very well yesterday as shortly after the UK markets opened the FTSE had a nice rally which enabled me to go short again at 6750 before the market had a nice sell-off which enabled me to cover this position at 6720 as again outlined to my Platinum Members and I am now flat. Today I will lower my sell level to6730/6760 with a tight 6785 stop.
Dow Rolling Contract
Thankfully just like the DAX above I am glad that I had no buy level in the Dow yesterday with the market getting hit hard on the back of IBM’s results with the stock closing down 6%. Remember this market can cave in at any stage especially with the five confirmed Hindenburg Omen’s already registered on the clock last month. I am still flat the Dow and today I will lower my sell level to 17960/18030 with an 18080 stop.
September BUND
No change as I am still a small seller on any rally higher to 153.50/153.80 with the same 154.10 stop.
Gold Rolling Contract
Gold is still trading heavy and so far is unable to mount any sort of rally. However Gold is very oversold and at the bottom of its Bollinger Band meaning a rally can start at any time. Today I will leave my buy level unchanged at 1078/1088 with the same 1065 stop.
Silver Rolling Contract
I am still long from last week at 15.05. I will leave my stop the same at 14.40 and if I am stopped out of this position I will be a more aggressive buyer in front of 14.10 with a 13.60 stop.
Recent Comments