IIFT Daily Note with Peter Brown

US showing solid improvement

Posted by:  |  Time: 7:39 am  |  Topic:  |  Comments: 2
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Two distinct stories yesterday. Firstly the heavy buying of Euro’s against the Yen and then good economic data from the States in the afternoon.

The JPY selling took me by surprise and the solid buying of Euro throughout the day put pay to my 1.3000 medium term target. Euro is now close to 1.3400 major resistance but for direction we need to look at Euro/JPY where all the action is. We are now over 120 but are overbought on the Weekly chart! We need a correction so although the sentiment is strong the JPY is oversold against the Euro and the USD. Today we need to see if the buying will continue or will we profit take.

On the stock market good figures caused a rally and the fiscal cliff is now been ignored. We know the fundamentals are strong for the S&P the only danger is the cliff talks. When they will impact on the market is impossible to tell. For the US investor this rally is a must. Safe haven bonds are a waste of time (no return) This market can do some more upside before the cliff dominates.

Levels this morning  1.3400  1.3350    1480 on the S&P support is hard to find 1472 on the pivot is the best  1460 major support

2 Comments

Yuvraj

January 18, 2013

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On daily EUR/USD it looks like and uptrend. May be an oppurtunity to Buy on DIP say around 1.3000 for long term.

For short term its very confusing to look for an entry.

    Elva Burns

    January 18, 2013

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    Hi Yuraj,

    Fundamentally I do not like the Euro. I think it is overvalued against the dollar in particular.
    1.3300 is daily support but I am short and going to run it unless 1.3400 breaks
    You could get a day trade being long but I fancy it through 1.3000

    Peter