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Good day Koalas!
Mid week. Are you totally GREEN
We last bearish action yesterday as IMF said that should a loan be needed for Greece, it will be on IMF’s terms. We know that the European Union leaders want control over the process and hence this caused concerns. Furthermore Iceland suffered a cut to its local-currency ratings. Something we don’t need more of.
The price was testing 1.3400 and a break could spell more bearish trouble for the currency pair.
Looking at the EUR/USD, it turned out that the support of 1.3400 held. You may be wondering. Hey it went below 1.3400! Remember, resistance and support lines are never a single pip!
The S&P 500 is holding pretty well despite the US ADP Non-Farm Employment Change coming in worst than expected. Relatively locked in the region of 1160-1180 for now, the market may be holding it’s breath for Friday’s US Non Farm Payroll.
Oil is currently around $81+.
Gold is trading around $1113, urged by the weaken US Dollar.
Looking at the movements today, one may presume that the risk appetite is once again strong. I beg to differ.
Looking at the bearish stance of the S&P 500 and the dismay release of the US ADP Non-Farm Employment Change, the current Euro “strength” maybe one of the selling of US Dollar rather than demand for the Euro. Being in the middle of an unemployment crisis, employment data is extremely sensitive in the US.
I mentioned a few times that nowadays, it is not a comparison of whether the Euro Zone or US is performing better but rather, who is worst off. This current play of momentum seems to suggest this.
Remember the markets were all so relieved with regards to Greece days ago? A report came out today discussing on Greece’s plans to sell a global bond in US Dollars in the next two months to help raise 11.6 billion euros. The recent bond sales by Greece resulted in a loss of money for investors, something very negative in outlook. The Greece deficit crisis is really beyond a simple fix and as the deadline draws near for debt redemption, the pressure will be on.
Tomorrow brings us important data again, including German Retail Sales and US Unemployment Claims.
Bullish pressure may take us above 1.3550 to 1.3600.
Bearish comebacks may target 1.3455/400.
I am glad many of you folks like the new H4 charts. Sincerely, i only want the best for you koalas. Nothing less.
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