thursday brainstorming

1. The Euro has reached now our target zone around 1.28 and is showing technical evidence for a short term bottom as we count the second daily 12 ( final 13 tomorrow) within a weekly 9 count. This makes it a strong case for a short term rebound from my 1.27/8  level starting next week. Help will rather come from the USA as the Full Moon in 4 days implies some USA specific financial trouble. Also will the USA not like the appreciation of the US Dollar since it kills a substantial part of the profits the SPX companies generate on the one hand and makes a very attractive case for foreign bondholders to sell.

Stockmarkets in USA are still due to test the SPX 1300 level the next days before a more severe pullback can be expected. Early next week around the Full Moon should be a good time for a top and a pullback in the 5-7% magnitude thereafter. Once the real top is set which can extend to end Jan not necessarily with new highs but overall the target area is 1310-30 a substantial drop should follow to the 1000 level. First indication for such a move will be a weekly close below 1200 which is the level I expect to be tested after we reach 1300-10.


Euro Slumps To 15 Month Lows As BTPs Crack 7% Yield

Submitted by Tyler Durden on 01/05/2012 – 04:45Consumer Confidence Copper Deutsche Bank European Central Bank France Sovereigns Unemployment

UPDATE: EFSF said to get EUR4bn of orders for 3Y issue is providing some cover (at what rate? We offer to buy 1tn at 300% yield…)

With plenty of time left until France unleashes its supply (and a dismal consumer confidence print earlier), there is a plethora of notable market moves: Unicredit is halted down 7.9% (seems to be the culprit for the initial risk-off turn in Europe), but DeutscheBank is down over 5% on liquidity problem rumors, EURUSD traded under 1.2850 at its lowest level since September 2010, 10Y Italian bonds have pushed well above 7% yields and 510bps spread to Bunds as Unemployment rises to 8.6%, Belgian 10Y yields are over 4.5% – highest in 3 weeks, and the rest ofEuropean Sovereigns are all leaking wider (near wides of the year). Risk assets (CONTEXT) broadly are under pressure but ES (the S&P 500 e-mini futures contract) is holding off yesterday’s early morning lows for now. Commodities are all dropping fast with Gold (actually outperforming in this slide) back at $1615, Oil at $102.50, and Copper approaching $340. Treasuries are bid but trading in line with Bunds’ movements so far in general. Some chatter of ECB buying in the last few minutes is stabilizing things a little here.


~ by behindthematrix on January 5, 2012.

One Response to “thursday brainstorming”

  1. Gold will continue to do well but could slump again suddenly at any time. The market has never been so volatile. Great article. I look forward to reading more of your analysis.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: