Irish Institute of Financial Trading » Market Blog

Looks like a quiet day

Peter Brown — Fri, 17 May 2013 06:34:01 +0000

No news and the markets fairly calm. Looks like a Friday off! Market this week has been nicely volatile but we faded out of making a new high yesterday on the S&P, so today we may go sideways.

Technical trading ahead for today. Levels are S&P 1660 1646 Euro 1.2900 1.2840 USD/JPY 102.7 101.80 Gold 1400 1325

Slow trading day ahead I feel.

Inflation data up this morning.

Peter Brown — Thu, 16 May 2013 06:41:35 +0000

Euro zone inflation up at 10.00 am. 1.2% expected. If this figure comes in below expectations we could see a sell off in the Euro. 1.2840 is the key level and a close below there will bring 1.2750 (the Cyprus low) into play.

Elsewhere we saw the usual rally on the S&P. Reaching 1660 before a slight profit take.

Yesterday morning we saw bad growth figures in the Euro zone but the market mostly ignored them. We are in a strange market. Rallies with no correction and bad figures being ignored! We have to live with what the markets are doing and although it does not make a lot of sense to many, fighting the trend is useless.

Elsewhere Gold looks very soft and has broken 1400, there is little reason to buy gold when Equities are charging.

USD/JPY 102.50 may be a short term top and we may get a correction to 100.50 area.

S&P levels 1660 1644 Euro 1.2900 1.2890 1.2840 support.

No growth in Europe.

Peter Brown — Wed, 15 May 2013 06:44:00 +0000

Releases this morning for German and French GDP are very poor. The Euro area is close to returning to recession. The Euro is lower but stock markets are not. This is a result of the cash dynamic we have discussed all year. People are reluctant to sell equity markets because of the excees of cash available in the global market. Yesterday we saw another high in the S&P 1650.

The market is very relaxed about this data. And is hoping for a return to growth in the second half of the year.

We may see a small sell off this morning but not a major reaction to these figures as we would normally expect. The pattern has been for Europe to be negative and the US to bounce.

So we are still on the buy on dips strategy. Worked great yesterday.

Levels today are S&P 1633 1650 Euro 1.2940/50 is now a top 1.2900 support 1.2750 is the target.

Gold may find support at 1400/1410 USD/JPY looks a bit toppish at 102.50

Another new high.

Peter Brown — Tue, 14 May 2013 06:31:04 +0000

Same again in the markets yesterday. Most products trading sideways and the US making a new high. Market is trading slower but the fundamentals remain the same. Today we have had German CPI, as expected and no surprise there. We are facing a day of range trading and probably a buy on any dip in the S&P.

It is important to understand when the markets are not offering major profit opportunities and now is such a time. Outside taking 20/30 points jobbing the only other opportunity is buying the dips on the S&P. Same again today.

Levels are Euro 1.3040 1.2940 major support. S&P 1620 support 1635 on the topside but not major.

Dollar strength, equities look tired.

Peter Brown — Mon, 13 May 2013 06:31:06 +0000

Dollar is still strong this morning, Euro at 1.2975 USD/JPY at 107.75. Equity markets however seem to have stalled a little. We are now well into May and the confidence to drive this market higher is fading slightly. We may be in for some side ways trading on the equity markets for a while. We lack any decent economic stats toady with only Retail sales at 1.30pm set to add any direction.

Concerns that the single banking supervisory will require a treaty change may soften Euroepen equity markets this morning.

All in all not a lot to go for early in the week. Range trading and few serious profit opportunities.

Levels are S&P 1630 1622 Euro 1.3060 1.2940 Gold 1485 1425 USD/JPY 102.15 101.20

Dollar Strength abounds

Peter Brown — Fri, 10 May 2013 06:34:39 +0000

Good jobs figures and a surge in the dollar have dominated overnight trading. USD/JPY finally put to bed the 100 resistance level. The economic releases in the US of late will bring back discussions on ending QE. This should cause the stock market to pause and put some serious strength back into the USD.

Trading should be interesting today, expect some profit taking in Euro and USD/JPY but the medium trend is clear. 105 then 110 for the pair. Moves as always will be fitfull and pullbacks will be large. 100 should be solid support so buy on dips

Euro 1.3000 1.2980 are major support 1.3100 is a sell level. S&P 1630 1620 S&P may find it difficult to find new highs against this backdrop. Be careful on that one today. If it starts to sell off in US time the correction may be substantial. I don’t think the trend it over but being a Friday we may see a profit take.

Getting fed up saying the market is higher!

Peter Brown — Thu, 09 May 2013 07:00:11 +0000

But it is. Up and onwards we go. No end in sight to this historical rally. Buy anything, it would seem is the strategy. I am not going to become a bear and start to predict the top of this. The rally is based on the desperate need for yield. This market would buy a burnt out caravan if they thought they could yield 3% on it!

From a technical point of view it is hard to call levels as we are at new highs everyday.

The market is simply a buy on dips.

S&P support at 1622 1617 Euro at new highs after a break out yesterday 1.3125 support 1.3250 resistance

Elsewhere we are range bound on USD/JPY and Gold. DAX and IBEX will likely just follow S&P.

Don’t be a seller.

Market slowing down

Peter Brown — Wed, 08 May 2013 06:32:01 +0000

We could be in for some range bound days after the hetic first 4 months of the year. Everything outside the S&P is starting to find a range. Euro, USD/JPY, Gold, DAX and IBEX are all moving sideways. The S&P keeps punching new highs but is starting to look tired. The sell in May and go away might just take the sting out of the market. I am not expecting a big correction but the upside could becoming limited.

Today we have German industrial production at 11.00am. Outside of that it could be very quiet. Market could stay in these ranges for some time if there is no big news. Value trades are at the edges of the range.

Levels are Euro 1.3240 1.3060 USD/JPY 99.30 98.70 Gold 1485 1425 S&P 1622 1608

Rally continues apace.

Peter Brown — Tue, 07 May 2013 06:29:27 +0000

Low interest rates and Central banks printing is keeping the buying spree in stocks intact. No sign of a correction in sight. We have never seen this dynamic in the markets before and it is hard to see where this will all end. One thing is sure, the market will not go negative without some very bad news to drive it. It will be hard to convince stock holders to sell their positions without a very good reason. As yet there is nothing in sight to cause a turn around, so buy on dips.

Elsewhere the Euro is range bound as is USD/JPY. Euro stocks are taking their direction from the US so DAX and IBEX are heading higher also.

Mood this morning should be set by the French figures due out in 15mins.

Levels are Euro 1.3240 1.3140 S&P 1615 1607

Looking for a top in this market will cost money. Just buy the dips.

Non Farm Payrolls.

Peter Brown — Fri, 03 May 2013 06:58:48 +0000

After yesterday’s damp squid where the market showed some volatility after the ECB, only to end back where we started. The US market is pulling everything with it. Despite the Euro market attempting to sell off after Draghi disappointed it was the surge in the S&P that caused the rally late on.

Today is NFP and we expect 140k (a low number) Normally we have to have a number 20k + or – to cause a stir. Today however I think any number at 150 or better will result in a new high for the S&P. We need lower than 130 to result in a sell off. This US equity market is teflon, and right across the globe the hunt for yield is driving a ‘buy anything policy’. This will end in tears but not yet. There will have to be a major shock to the market to force hedge funds to exit the market. As yet there is no shock in sight, so we keep buying the dips.

Trading levels are : S&P 1596 1576 NFP will dictate. Euro 1.3240 1.3180 1.3100 1.3045 is the major support.