IIFT Daily Note with Peter Brown

G7 Talk or Action

Posted by:  |  Time: 7:21 am  |  Topic:
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Overnight the G7 have tried to talk the Spanish situation up. All sorts of deals on the table designed to give Spanish banks capital without Spain entering an official bailout. Good luck. We have seen this situation before, after each of the 18 emergency leader’s summits. Market bounces on expectation than falls on failure to act. I think this is the same here.

So how far can we bounce? on the extreme 1300 on the S&P and 1.2625 on the Euro. These would be great levels to sell. Unlikely to reach there though. More likely is the 1.2525 level holds on the Euro and 1293 on the S&P.

This is a bear market and the action at the moment is only a correction to that. It is a difficiult market to trade because we don’t know how far we will bounce.Keep the trading tight untill a defined bear market returns.

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