brainstorming tuesday

1. This week will be split again as towards the second part a distress pattern with Venus square Pluto ( bad timing for a royal wedding) though it will mostly impact bond markets as more default distress is due. The rumor that Greece would default this weekend did not come true. I suspect that France and Swiss banks do not like that idea anyway since they hold the biggest chunk of their debt and the Germans will not get it done that quick. Stockmarkets are poised to rise further as the DOW should reach the target area of  12800 as we made the weekly 11 count last week 2 higher weekly closes. As NDX will test the gaps towards 2390 we can expect a minor pullback later this week. Crucial is also the FED as they will hold their first press conference after a meeting Wednesday. A rumor was claiming they would announce the exit of QE2 but instead we rather got the QE3 light hints from Bernanke and the Chinese announcement to divest up to 2 tril US Dollar assets will put that into jeopardy anyway as they will at best case match those sales while the government will do more borrowing anyway.

2. Volatility is on in precious metals with the big mover being silver as it hit the Hunt high as expected at 49.50 and dropped almost 10% from that level after margins were raised.


Silver Undergoes 10% Correction As Dollar Poundage Resumes; Dollar-Backed Swiss Franc Now Flight To Safety

Tyler Durden's picture

Submitted by Tyler Durden on 04/26/2011 04:25 -0400

And so the proverbial correction in silver may have well been completed in the span of 24 hours. As the attached chart shows from its Sunday night peaks to its Monday night bottom silver has dropped over 10%, what some call a mini bear market (which takes it to those depressionary lows seen on Thursday of last week). Is the climb now set tp resume, although not so much due to anything else (and there is plenty else) but because the USD pounding is back in full brokeback style. The EURUSD is about to break above the Sunday night heights in the mid 1.46s and while weak hands are vacating gold and silver, everyone is scrambling to load up in CHF. We wonder how long until those same people realize that Hildebrand is just as mortal as any other central banker with a balance sheet behind him, and as recently as 12 months ago underwent a failed campaign to halt the surge of the CHF in the process contaminating his assets with some seriously ugly currency assets (if one may call $220 billion of dollars on the left side of your balance sheet assets and thus implicitly “supporting” the SNB liability – the Swiss Franc) whose eventual unwind will not be too kind on the Swiss currency.


Dollar basket:


~ by behindthematrix on April 26, 2011.

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