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GU is getting really close to hitting that 55 right now. almost all pairs have to be getting near exhaustion imo
I see EU keeps taking it's Viagra
that's what money will do to ya
well it sure isn't far away now.
Dollar Poised for Further Losses After US Data
Forex traders have continued to dump the dollar after the first set of U.S. economic reports showed additional weakness in the U.S. economy. Weekly jobless claims increased less than expected but the rest of the numbers are very dollar bearish. Continuing claims increased materially, the Empire State manufacturing survey fell to a one year low while producer prices dropped 0.5 percent. Excluding food and energy costs, PPI increased but that provides little relief when food prices dropped by the largest amount since April 2002. On an annualized basis, PPI growth decreased from 5.3 to 2.8 percent, reinforcing the deflationary fears of some FOMC members. Industrial production increased by 0.1 percent but the rise was not strong enough to offset the other weaker reports.
The rally in euro and British pound indicate that the dollar is trading on fundamentals and not risk appetite. Following a day where retail sales fell short of expectations and the FOMC minutes showed more dovishness within the Fed, U.S. fundamentals is making the dollar less attractive to investors. In fact, euro and sterling extended their gains following more good news from Europe. The price action in the markets suggests that investors really want to move on from the fiscal problems in Europe. As a result, they have shrugged off yesterday's bad news to focus on the good. However this improvement in sentiment will face a big hurdle next week when the stress test results are released on July 23rd.
Strong earnings from JPMorgan and another successful 15 year bond auction in Spain should help the EUR/USD hold onto its gains. The bid to cover ratio was 2.57 compared to only 1.79 at the previous auction. The yield was higher, but CDS spreads have compressed which indicates that investors are more relieved than concerned by the auction results. Meanwhile USD/JPY appears to poised to test its year to date low below 87.
congrats great job "The Last Wave Counter" lololol
at this rate you could be right
yeah I agree which is why I have stayed away from it, it's a crazy pair to play right now
That sucks I hate waking up like that
there is always another play around the corner
Top Stories
* Successful Spanish Auction Fuels Euro Rally
* Chinese data misses forecasts but not as bad as feared
* NIkkei of more than -1.0% Europe lower by -25bp on open
* Oil at $76.80/bbl
* Gold rallies to $1214/oz.
Overnight Eco
* AUD MI Inflation Expectations 3.3% vs.3.4%
* AUD New Motor Vehicle Sales m/m -1.2% vs . -3.9%
* JPY Overnight Call Rate 10bp
* NZD Business NZ Manufacturing Index 56.2 vs. 54.0
* CHF ZEW Economic Expectations 2.2 weakest in 12 months
* GBP Housing Equity Withdrawal q/q -3.2B vs. -3.3B
Event Risk on Tap
* CAD Manufacturing Sales m/m expected at 0.4%
* CAD New Motor Vehicle Sales m/m expected at -5.2%
* USD PPI m/m expected at -0.2%
* USD Core PPI m/m expected at 0.1%
* USD Unemployment Claims expected at 453K
* USD Empire State Manufacturing Index expected at 18.9
* USD Capacity Utilization Rate expected at 74.2%
* USD Industrial Production m/m expected at 0.0%
* USD Philly Fed Manufacturing Index expected at 11.4
Price Action
* USD/JPY 88.00 tested in early Europe but bids prop so far
* AUD/USD tumbles to .8750 on weak Chinese data but recovers in Europe
* GBP/USD fresh swing high at 1.5340 as risk flows supportive
* EUR/USD rallies to 1.2800 as depand for Spanish bonds goes well
Risk FX rallied in midmorning European trade on the back of a strong Spanish bond auction that allayed fears over the financing of Southern European sovereign debt. Euro took out the 1.2800 figure while cable finally broke through 1.5300 handle as both currencies set fresh eight week highs. Spain was able to auction off nearly 3 Billion of long term bonds attracting a healthy 2.57 bid to cover ratio versus only 1.79 during the previous auction on April 22nd. Although demand for Spanish paper was robust, the yield on the 15 year bonds was sharply higher at 5.12% versus 4.43% previously. In a sign of further calm in the credit markets the Spanish/German spread compressed to 194bps in the aftermath of the auction from 205bp before the event.
The news sparked a rally in high beta FX which earlier had come under pressure from weaker than expected Chinese data. Chinese economic releases all missed their mark with GDP printing at 10.3% versus 10.5% eyed, Retail Sales coming in at 18.3% versus 18.8% forecast and Industrial Production sharply lower at 13.7% versus 15.2%.
As we noted earlier, “Risk FX initially rallied in the aftermath of the news on the assumption that the data was not as bad as feared. Traders were also heartened by the lower than expected CPI figures which suggested that Chinese monetary authorities may not have to resort to further tightening measures as the year progresses. However, the early enthusiasm faded as the realization sunk in that Chinese growth is likely to slow in the second half of the year and could contribute to the overall slowdown in global demand.”
Despite the rally in euro and cable in overnight trade we believe that further gains will be considerably more challenging as the day progresses. Today’s North American calendar will have US PPI data which we think will miss to the downside given the decline in import prices. Also on the docket will be reports on Industrial Production, Empire Manufacturing and Philly Fed with market expecting generally lower results. If the data disappoints to the downside, equities are likely to cap their recent seven day streak. If risk flows turn negative, both euro and sterling are vulnerable to some profit taking and could tumble during North American trade.
One report that could help maintain the risk rally rally today will be the weekly jobless claims numbers due at 12:30 GMT. The market expects a small improvement to 448K form 454K the week prior. However, if the data surprises to the upside, it may overshadow all other gauges with investors becoming more confident that labor markets are finally showing some signs of pick up. A strong print could negate our bearish view and extend the equity rally, forcing another short squeeze in the euro with the pair targeting 1.2850 as the next objective of the longs.
FX Upcoming
Currency GMT EST Release Expected Prior
CAD 12:30 8:30 Manufacturing Sales m/m 0.4% 0.2%
CAD 12:30 8:30 New Motor Vehicle Sales m/m -5.2% -4.7%
USD 12:30 8:30 PPI m/m -0.2% -0.3%
USD 12:30 8:30 Core PPI m/m 0.1% 0.2%
USD 12:30 8:30 Unemployment Claims 453K 454K
USD 12:30 8:30 Empire State Manufacturing Index 18.9 19.6
USD 13:15 9:15 Capacity Utilization Rate 74.2% 74.1%
USD 13:15 9:15 Industrial Production m/m 0.0% 1.3%
USD 14:00 10:00 Philly Fed Manufacturing Index 11.4 8.0
EU wow where is the top for this bad boy
NJ out at 63.25 for 100 pips
chart looks beautiful to me
I second that motion
NJ is looking sweet
well so far so good for it
NJ just took a short at 64.25
Expect Slow Grind Lower after US Data
For the second month in a row, U.S. consumers cut back spending as the government led recovery slows. The U.S. economy has come a long way since entering into recession in December 2007 but the path to the exit has been long and exhausting. Unemployment rolls remain very high and most people have only found part time government work, forcing all consumers to be more conservative. There may no breadlines, but frugality has become a way of life.
Retail sales fell 0.5 percent in the month of June, which was slightly more than the market had anticipated. The number could have been a lot worse considering that most clothing retailers posted a decrease in revenue last month. However the selloff in the dollar was limited because the details was not as ugly as the headline number thanks partially to a late Memorial Day weekend which added approximately 1 percent to spending. Retail sales excluding autos and gas also rose 0.1 percent. Contrary to the ICSC and Redbook reports which showed that retailers were struggling, Americans bought more clothing and electronics last month. The biggest cutbacks were made in furniture, building materials, sporting goods and gas station receipts as gas prices fell to a 3 month low. At the same time, the retail sales report was far from positive for the dollar, particularly after you factor in the downward revision to the prior month.
Meanwhile the change in import prices is extremely dollar bearish and will probably lead to a slow grind lower in USD/JPY. The cost of imported oil, business equipment and consumer goods fell 1.3 percent in June, the largest decline since January 2009. Weaker demand from China, softer commodity prices and a strong data has kept a very tight lid on inflation. In fact, the import price numbers flash deflationary signals which will keep the Federal Reserve at bay.
The minutes from the most recent monetary policy meeting are scheduled for release this afternoon. The latest comments from Bernanke suggests that he is still very worried about the outlook for the U.S. economy and therefore we expect the minutes to contain a very subdued tone, which could weigh on the dollar.
wow never heard of that yet, great allstar cast in it
I find it amazing at how much that stuff that looks like junk is worth
bigtime
EU I can't believe it keeps going straight up.
your post is spot on to a T
AU is looking good to go short soon
WOW look at the huge spike on EU just now
US and Canada Trade Show Strength Beneath Headlines
Strong earnings from Alcoa, a sufficient bond auction for Greece and weaker trade numbers from the U.S. and Canada have basically left currencies not far from yesterday's levels. The rise in stock market futures and the resilience of pairs such as the AUD/USD and GBP/USD suggests that investors still want to be long risk. Moody's downgrade of Portugal did not faze investors because they were simply bringing their ratings in line with S&P and Fitch.
Both the U.S. and Canadian trade numbers failed to live up to the market's expectations but the pickup in exports and imports in the U.S. and Canada tell a very different story from the headline numbers, which is why risk appetite did not recede after the reports.
The U.S. trade deficit climbed from -$40.3B to -$42.3B, the widest level since November 2008. The dollar shrugged off the release because exports increased 2.4 percent while imports rose 2.9 percent. The details of the report showed a pickup in external and internal demand that had nothing to do with commodity prices. Instead, Americans imported more than they exported, causing the trade deficit to balloon. Demand was particularly strong for cars and pharmaceuticals.
The Canadian dollar also disregarded its weaker trade number to rise to a fresh month to date high against the U.S. dollar. After a downward revision to trade numbers for January to April, Canada is now left with a trade deficit for the third consecutive month. In May, Canada reported a CAD$503M deficit compared to April's CAD$330M deficit. However like in the U.S.' report, strength beneath the headlines help to lift the currency. Exports rose 4.2 percent while imports grew 5.7 percent. The increase in volumes indicates that the wider trade balance is a reflection of stronger not weaker domestic and external demand.
Top Stories
* Moody's downgrades Portugal
* UK CPI hotter than forecast at 3.1% vs. 2.7% eyed
* Asia mildly lower but Europe up more than 1%
* Oil at $74.86/bbl
* Gold rises above $1200/oz. to $1204/oz. last
Overnight Eco
* AUD NAB Business Confidence 4 vs. 5
* JPY Household Confidence 43.5 vs. 42.4
* CHF PPI m/m -0.4% vs. 0.2%
* EUR German WPI m/m -0.2% vs. 0.3%
* EUR German ZEW Economic Sentiment 21.2 vs. 25.2
* EUR ZEW Economic Sentiment 10.7 vs. 16.8
* GBP RICS House Price Balance 9% vs 20%
* GBP CPI y/y 3.2% vs 3.2%
* GBP Core CPI y/y 3.1% vs. 2.7%
Event Risk on Tap
* CAD Trade Balance expected at 0.4B
* USD Trade Balance expected at -39.4B
* USD IBD/TIPP Economic Optimism expected at 47.9
* USD Federal Budget Balance expected at -81.6B
Price Action
* USD/JPY breaks below 88.50 on downgrade news
* AUD/USD .8700 holds for now as equities bounce
* GBP/USD rallies above 1.5050 after hotter CPI data
* EUR/USD below 1.2550 after downgrade and weaker ZEW data
High beta currencies went their separate ways in early morning European trade with euro falling below 1.2550 after Moody’s downgraded the debt of Portugal while cable rallied towards 1.5100 after CPI data printed hotter than expected. The euro was pressured after Moody’s lowered its rating on Portugal by 2 notches as it cited concerns that the country’s growth prospects could suffer if the structural reforms do not work as planned.
As we noted earlier, “Tonight’s downgrade reopens the issue of sovereign debt default with respect to the weaker EMU members and puts fresh stress on the euro after a period of calm had returned to the markets over the past several weeks. The downgrade came at a particularly vulnerable time for the Eurozone just as Greece was about to auction of a series of Treasury bills today. Still, the news was not totally surprising to the market given the fact that Moody’s ratings were higher than those of Fitch and S&P and essentially reaffirmed the consensus view that financing conditions in Southern European economies will remain challenging for the foreseeable future.“
On the economic front the news from the Eurozone was of little help to euro longs as the ZEW survey missed its mark printing at 21.2 versus 25.2 eyed. However the current conditions gauge improved to 14.6 versus -7.9 in June. Although the data was weaker than expected the euro saw only a limited reaction to the headline as traders took solace from the fact that rate of decline in ZEW readings slowed markedly indicating that business conditions in the region are stabilizing. Still the euro remains vulnerable to further selloffs as the day progresses especially if risk aversion flows return in North American session. For now the 1.2500 figure appears secure, propped up by rumors of a large option expiry bid at that level, but another run lower cannot be ruled out after the New York cut at 14:00 GMT.
Meanwhile cable completely reversed its losses in mid morning London trade running through the 1.5100 handle after falling below the 1.5000 figure earlier in the session. Sterling was boosted by the hotter than forecast UK CPI numbers which rose 3.1% on annual basis versus 2.7% eyed. Inflation pressures remain sticky which will likely limit any further QE measures from BOE.
Over the past several weeks cable has been rallying on positive investor reaction to the austerity steps undertaken by UK fiscal officials, but in order for the unit to maintain its strength the currency market must become convinced that the reduction in spending will not jeopardize the country’s nascent recovery. To that end tomorrows UK jobless figures will be a key barometer of the economy’s health. If the data beats to the upside, the rally in the pound could extend beyond the recent swing highs of 1.5200.
In North America today the eco calendar is relatively uneventful with only US and Canadian trade balances on the docket. The market expects the US data to improve while the report for Canada is forecast to decline slightly. Overall however, the flow is much more likely to be driven by the news from the equity market where earnings season starts in earnest today. If equities continue to rally risk FX should remain supported throughout the day.
FX Upcoming
Currency GMT EST Release Expected Prior
CAD 12:30 8:30 Trade Balance 0.4B 0.2B
USD 12:30 8:30 Trade Balance -39.4B -40.3B
USD 14:00 10:00 IBD/TIPP Economic Optimism 47.9 46.2
USD 18:00 14:00 Federal Budget Balance -81.6B -135.9B
yeah can't argue with being honest lol
One day while driving in Nashville there was one homeless man who's sign said "I won't lie, I just want a beer" lololol everyone was giving him money
well it was a triple top it was a good one to hold on to if we were short which we were.
I think what the problem is that everyone thought the recession was over and we would climb back. well all we are is just stuck so we are back to doom and gloom. everything is not peachy which is why people are pulling their money out. all my opinion though
great job glad to hear it
Looks like GU finally hit your target. Gotta love the charts
well glad to have you back my friend
that's about right lololol
well it's all due to all of the people on this board. Before I came here I was a penny poppin trader who got tired of the lying and coniving going on. I didn't even know how to read charts until I came to Simple's board. I do now. All I need to learn now is these waves counts like my man Pennies has.
yeah just see what happens if we go to their country and do that and fly our American flag off of our porch. we will get booted so fast.
yeah I fully agree. i use to be an electrical foreman and there were I bet less then 1% illegals doing that job because it is not something you can slap a coat of mud on. you need skills to do that job.
out GU again with 100 pips. 215 pips on GU in 2 days is sweet.