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Good day koalas.
In the last review, i spoke about the concerns with regard to ECB’s low interest rates for the Euro Zone. A prolong period may reduce the economic “attractiveness” of the zone, dampening growth.
Furthermore, Home Sales in the US is getting bogged down by the unemployment problem and the outlook remains bleak.
Now let us take a look at the EUR/USD midweek.
Red Alert! All hands to battle stations. We have breached 1.3455 and more!
The S&P 500 is slightly bearish for now. Having said so, it is no where near the breakdown of the EUR/USD.
Oil is hovering around $79+.
Gold is affected by the stronger US Dollar and is now trading at $1091+. Despite the breakdown, gold has not fallen very much. This suggests demand as gold is a popular investment when it comes to times of uncertainty.
Reports stated that Portugal’s debt was downgraded by Fitch Ratings. With increasing concerns over Greece and the possibility of a default, the last thing the market needs is another troubled country. Confidence towards the Euro Zone is slipping away and we can see such indications all around. For example, today’s German Ifo Business Climate came out better than expectations. Yet it failed to prevent the break down of the EUR/USD. Look at the S&P 500. Despite the storm, it is holding up pretty well. This suggests that investors have a problem with the Euro Zone in particular. Not the US, not Asia, JUST Euro Zone.
Watch out for the developments of other Euro Zone countries. If more problems surface, we may be in for a ride.
Now, no news doesn’t mean good news. In a less sensationalised report, the US New Home Sales came out lower than expected. As Home Sales is a good stimulant of the economy, a depressing figure may have wider impact on the economy. A poor job market continues to weigh on the property market.
On a technical front, the break down of 1.3455/400 opens up a new range leading up to 1.3200.
A number of speeches tomorrow and important releases such as the US unemployment claims. Practice proper money management!
If the bulls arrive to save the day, 1.3400 may be next.
Should the relentless assault of the bears continue, we may see a test of 1.3285+.
14 hours work today for me. Woah. This is not the koala way! I just want to hug the tree and eat all day long
Trade Safely ( Oh! L4D2’s new DLC is coming out soon. Am soooooooo excited! )
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