IIFT Daily Note with Peter Brown

Markets , thin and skittish

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Yesterday’s 300 point rally on the S&P came about on scant news regarding the fiscal cliff. This is the type of market we experienced in August 2011 with the TARP negotiations. Big moves and little long term direction. I fear this will be the trend until year end. We are a long way from agreement and will experience politicians commenting on the process driving markets up and down.

On the S&P 1420 is massive resistance 1380 is support. Our ranges are going to get wider. The only way to trade this market is to give yourself a daily budget say 50/75 points. Try to go with the move, if you get it wrong you will survive but your good days can yield 150+ points.

Euro is more stable  1.2960  1.2880 range.

USD/Jpy still moving sideways while the overbought position unwinds. Should be a buy shortly.

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