Dec 31, 2011

Your forexlive.com ENewsletter

Your forexlive.com ENewsletter

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ForexLive North American wrap: Goodbye 2011!

Posted:

Spain forecasts 2011 deficit at 8% versus 6% target Spain announces € 8.9B in spending cuts EUR net short position falls to record in CFTC Commitments of Traders report IMF says USD share of global FX reserves +7.5% y/y in Q3; EUR loses ground Milwaukee PMI Dec 57.77 vs 56.7 prior US Congress delays vote [...]

S&P 500 closes infinitesimally down on the year

Posted:

If you bought the S&P 500 at the close last year, you lost 0.43 points on the year. The close was 1257.21 compared to 1257.64 in 2010. That’s just incredible. On the day, the index fell 5.5 points, or 0.4%. On the week, it lost 0.6%. The yearly is a massive doji. The AUD/USD and [...]

The drachma is not a good idea

Posted:

The head of Greece’s central bank says a return to the drachma would be disastrous; it would mean a 60-70% devaluation. He says he’s certain Greeks would not allow such a scenario.

EUR shorts hit record in CFTC report

Posted:

The Commitments of Traders report shows the EUR net short positions falling to a record at -128K compared to -114K last week. The data is for the week ending Dec 27. JPY -2K to +22.6K GBP -3K to -29.1K CAD +5K to -21.8K AUD +7 to +37.2K NZD +1K to +1.4K The resulting USD position [...]

S&P 500 falls to almost unchanged on year

Posted:

US stocks have turned lower heading into the final hour of trade. The S&P 500 is at 1258 compared to the 1257.64 close of 2010. Risk aversion is spilling into FX with EUR, AUD and GBP at the lowest since early in US trading.

Four trades for 2012: #1 sell the euro

Posted:

Wait for a bounce, sell the euro, make money. Repeat. That will be 2012 in a nutshell. In the past two days, EUR has hit long-term lows against JPY, USD, GBP and a record low versus AUD. It’s a technical disaster. The year ahead will be one crisis after another in Europe: The economy will [...]

Delayed Wht Hse Debt-Hike Request Allows Symbolic Hill Vote

Posted:

By Denny Gulino WASHINGTON (MNI) – Secure in the knowledge that Capitol Hill ultimately cannot withhold $1.2 trillion in additional borrowing authority, President Obama Friday postponed his request for the increase of the government’s debt limit. Eager to record their votes against the inevitable increase, many congressional Republicans had asked their Capitol Hill leadership to [...]

Four trades for 2012: #2 sell the Swiss franc

Posted:

I bought EUR/CHF shortly after the 1.20 peg was introduced and have held it ever since. My only regret has not been trading the range more aggressively. At this point everyone has an opinion of the SNB so I won’t try to convince the bears. Personally, I see no signs of a lack of SNB [...]

Bonds closing early

Posted:

The US bond market will close in a few minutes (at 2 p.m. ET). It’s already looking like US stock market trading volumes will be the lowest of the year so things may get especially wonky here.

Four trades for 2012: #3 buy gold at $1350

Posted:

I wake up every morning at least a little bit long gold. I’ve tried staying flat but I start to lose my sanity and start buying every dip. This year, I’m waiting for the big dip and I’m loading up. Next year will be an “inside year” on the chart, meaning gold will not exceed [...]

Four trades for 2012: #4 USD/CAD to hit 1.12

Posted:

I am stalking this trade like a tiger. Watch the wedge on the daily chart in USD/CAD. When it breaks, expect a 600-700 pip move. For confirmation, check the similar chart in copper. My bias is to the upside because my base case for 2012 is disappointing growth. A multitude of political pitfalls remain and [...]

US holds off on raising debt ceiling, because they just don’t feel like voting

Posted:

Officials say Congressional leaders have requested to delay the vote on hiking the debt ceiling, due to scheduling They say the Treasury can avoid hitting the ceiling with accounting shuffles The laws were changed to make the upcoming a hike in the ceiling automatic. Congress would have to vote to disapprove it, which Obama said [...]

US DATA: Dec farm prices -4.3%…………………..

Posted:

US DATA: Dec farm prices -4.3%.

That could be all for 2011

Posted:

As New York heads to lunch (will they even come back?) and London signs off for the year we are seeing some retracement. I expect we’ve seen the full ranges for the day and the rest will be consolidation. EUR/USD fall to 1.2970 after failing to break 1.30. It’s time to start making some 2012 [...]

European stocks close for the year

Posted:

DAX closes up 0.9% today to end year down 14.7% CAC-40 up 0.8% to close year down 17.8% The FTSE 100 closed earlier, up 0.1% on the day and down 5.7% on the year. More stocks annual stock performance numbers here. Here’s a chart on asset returns in 2011. EUR/CHF and USD/JPY are wrong (maybe [...]

Wicked moves at the top of the hour

Posted:

EUR/CHF just fell to 1.2148 (a great level to buy IMO) USD/JPY plunged below 77.00 AUD/USD surged to 1.0246 EUR/JPY back below 100.00 It’s clearly fixing demand/flows USD/CAD has held steady at 1.0182 but if this holds up, it should fall.

The daily indicator to watch next week

Posted:

It’s not non-farm payrolls, retail sales or the ISM surveys. The market goes through phases where it decides to focus on one thing or another. Right now it’s daily overnight lending at the ECB. The data is published on the ECB website at 8:10 GMT from Monday to Friday on the line “use of deposit [...]

Rumors of the USD losing its reserve status greatly exagerrated

Posted:

IMF data shows the buck’s share of global reserves up 7.5% y/y in the third quarter. The euro lost ground. Another reason to be short EUR/USD in 2012.

US DATA: Fed has released Maiden Lane updates the….

Posted:

US DATA: Fed has released Maiden Lane updates showing the latest paydown amounts. See http://www.newyorkfed.org/markets/maidenlane.html#tabs-1

Milwaukee PMI 57.77 vs 56.7 in Nov

Posted:

The next person to make a trade based on this indicator will be the first. On manufacturing, the latest forecast has Tuesday’s ISM at 53.2 vs 52.7 in Nov. Non-farm payrolls forecasts are being revised higher with the consensus now at +150K.
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