IIFT Daily Note with Peter Brown

Bernanke

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Yesterday saw a good sell off in markets due to Greece. Follow that by a good gap close attempt. And then the bombshell by Bernanke. Low interest rates forever! and a possibility of QE3.

Dollar got blitzed and the equity markets loved it.

That blows the top of our ranges with Euro breaking through 1.3080 and S&P up at 1320. 1.3080 should be good support, however we need to see the market reaction in European time. Will we ignore Greece and just sell dollars. If so we have to target 1.33  and 1350 on the S&P. It’s going to be an interesting morning session.

On a note of housekeeping, for those of you in the West. Nick Leeson the famous Barings Trader and I are doing a one day bootcamp on 17th February in Galway. It’s the first in a country wide tour hopefully. Details are on the website. Hope to see you there.

 

3 Comments

Ross

January 26, 2012

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Hi Peter,

When I finished the Diploma before Christmas you said you saw precious metals selling off as Central banks liquidated reserves to pay down debts. Do you still see a sell off or with Bernanke’s infinite QE and low rates till 2014 and probably later. Are you still standing by your prediction? Just so you know I am on the other side of the fence and see much higher prices in PM’s, in both Dollars and Euros.

Thanks
Ross

    Elva Burns

    January 26, 2012

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    Hi Ross,

    Precious metals would be sold off if Governments needed cash to fund. Since the introduction of the LTRO 500bln which gave the banks funding at 1% for 3 Years it has stabilised the bond markets and with a further tranche available FEb 29th it is unlikely any Governments (except) Greece will be in funding trouble.So to this extent that danger can be removed from the PM price outlook

    Regards

    Peter

Paul

January 26, 2012

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Peter,
do you think there is a bullish candle forming on the EURUSD if you look at the monthly chart for that?

Paul