IIFT Daily Note with Peter Brown

Another power finish to US stock markets.

Posted by:  |  Time: 7:46 am  |  Topic:
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S&P performed again. This market is rubber. Every fall is followed by a strong bounce. Alcoa results after close were ok and supported the rally. We are close to the highs of 1568 and given a fair wind we should test 1570 today. I know I keep repeating buy on dips, but sometimes the market is simple and does not require much thinking. This is such a market. If a turn around comes it will be based on some serious bad news. That is likely to come from Europe as we have seen bad NFP figures have been ignored. I do not see anything on the medium term horizon to cause this.

USD/JPY is stunning. When you give a call of 100 you expect it to take a while to reach. Especially on a traditionally slow mover like USD/JPY. We hit 99.65 overnight! Now 100 may hold it for a while but we now have to set for 105. There will be pull backs but as lately these have been shallow. Buy on all dips,

On the Euro I am still a bear but as the flows leave Japan, the euro is getting some strenght. We might see 1.3200 based on these flows but longer term I see the Euro a lot lower. I am switching to jobbing mode until this technical flow dinimishes.

Levels today are S&P 1568   support at 1555  1552 1545

Euro 1.3065 1.2990  USD/JPY 100  98.80  98.40

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