EurAnalysis

German 10y Bond Auction and USD 10y Bond Auction both are in the same day. Today market may have a bigger range and choppy for sometime?

Evening everyone. Seems like its mixed out there between bulls and bears (for todays move)

I'm a bear but it's taking forever. London usually takes care of it though.

He is hotlinking the site, free advertisment and impression are the other reasons.

If I am not wrong I should read it as "German 10y Bund Auction" instead "German 10y Bond Auction"?

All our family gathered together in front of the screens - morning update is about to begin..

Good morning everyone

Here we sit... once again at yesterday's opening levels. This pair has gone absolutely nowhere. No bull follow-through and not enough interest from the bears either. Yesterday I pointed out how certain key instruments were at key levels and that if those key levels were broken, that I would be inclined to turn bullish from neutral on this pair in the short term. Yesterday the SP500 managed to break up through its 1400 psych level, but as anticipated, there was no follow-through and price closed the trading day back below 1400. The AUD/USD likewise spiked above the 1.06 level by 2 pips and fell back down almost 70 pips to close the day at 1.0533. Also the E/U pair never managed to get above the all important 1.2440 level. There just doesn't seem to be enough interest. Wondering why? Well I have a theory...

In Draghi's bold announcement last week, he said that the ECB may engage in short term dated sovereign bond purchases in the secondary market in order to help reduce the bond yields as long as those particular EZ nations (Spain and/or Italy) applied for aid from the EFSF and met the conditions associated with such aid. Spanish officials were quite quick to release official and semi-official statements saying that they would not be looking for any EFSF aid if there were any conditions in addition to the conditions agreed to for the previously pledged aid to the Spanish banks. Furthermore, yesterday and this morning, there were similar statements released from Italian officials saying that they will go it on their own and that they do not require any aid. So, what does this mean? This clearly (at least to me) means that there will be no bond purchases by the ECB.

Nothing has really changed in the EuroZone as far as the economy is concerned. Yesterday's economic data has pretty much confirmed that and the additional data to be released during the rest of this week will most likely further confirm where we are headed. One positive thing that came out of Draghi's pledge is that the EZ sovereign bond markets have started to adjust the yield curve from flat to normal. In essence, the extreme fear of a Euro breakup has been tempered. So now we can focus on the economic factors and therefore expect calmer markets (at least for the month of August anyway).

From a technical perspective, nothing has really changed in the mid to long term outlook. We are still in an indecision zone and will most likely maintain the range between 1.2440 on the high side and 1.2040 on the low side... A perfect 400 pip range. For anyone looking for a juicy RR trade , a short from these levels seems like a nice one, targeting the low end of the range with a stop above the high. So far since early Monday, we seem to have made an unconfirmed triple top pattern. The neckline of the pattern comes in around 1.2350. So if breached, sets a target of around 1.2260

Anyway, as always, I wish you all the best of luck in your trading and many green pips.

E/U H4

cool I put him on iggy list - his charts are unreadable and hard to follow his text without the chart

Today’s orderboard

Written by Pete Jackson
August 8, 2012 at 06:32 GMT

EUR/USD: Bids 1.2370/80 larger down at 1.2330/50, sell stops below. Offers 1.2400 layered up to 1.2450 buy stops above on a break of the 1.2450 barrier. Also talk of another barrier at 1.2500 (supposedly part of a 1.20-1.25 DNT)

GBP/USD: Offers 1.5630/50 and 1.5690/00. Bids 1.5600/10 some sell stops down through 1.5580 ahead of more bids 1.5540/50 and 1.5500/10, sell stops below through 1.5495.

EUR/GBP: Strong offers 0.7960/70 and tech res 0.7967 (55 day MA) stronger again up at 0.7990/00. Bids 0.7900/10, sell stops just below.

USD/JPY: Bids 78.35/50 and 78.00/10 (semi official, Kampo, importers, Japanese lifers), large sell stops through 77.90 and 77.50. (barriers noted at 77.75 and 77.50). Offers 78.80/00 (exporters) some buy stops mixed in through 78.85, and more stops through 79.00 just ahead of tech res at 55/200 day MA’s at 79.09 /17

EUR/JPY: Bids 96.90/00, 96.50/60, and tech supp 96.35/40 (96.36 Tenkan line). Offers 97.40/50 and stronger up at 97.75/8580

AUD/JPY: Bids 82.50/60 (Japanese names) sell stops below. Offers 82.90/00 and 83.15/25

EUR/CHF: Bids 1.2000/10(SNB), Offers 1.2025/30

USD/CHF: Tech supp 0.9660/70 and 0.9630/35. Offers 0.9700/10 and 0.9730/40

AUD/USD: Offers 1.0580/00 (model funds, importers), larger 1.0630/50. Bids 1.0530/40 and 1.0500/10 sell stops through 1.0500.

EUR/AUD: Offers 1.1760/70 and tech res 1.1845/55, likely buy stops above. Bids 1.1735/45 and tech supp 1.1695/05

NZD/USD: Offers from 0.8155/65. Bids 0.8120/30 and 0.8170/75

USD/CAD: Bids 0.9950/60 (funds, Canadians). Offers 1.0000/10 and 1.0020/30

Today's Euro FX option expiries at 14:00 GMT

1.2400
1.2410
1.2475
1.2495
1.2500


Hmmm. I haven't found any suggestion or indication that there are option expiries below 1.2400. However, I am almost sure there are. Perhaps they will be published later in the day. Until then, this is all I can find.

Yeah 1.2400 and 1.2410 are so close. 1.2410 is more relavant to me.

So... How's everyone this European morning? Are you all excited that we may finally be heading back down? At the minimum, it already seems that the upside is well capped. Therefore, according to the addage, what cannot go up, must go down. Right? Well, I'm hoping coz if we get another day of comatose Euro, I'm seriously considering the 5 minute walk to the beach

...and here's the US Dollar index. Still holding strong. Bless her little heart

DXY Daily

But there are German 10Y Bund Auction and USD 10Y bond Action, dont you think these may effect the exchange rate?

I knew it. Here are the sub-1.24 option expiries for today...

1.2250
1.2300
1.2320

I don't think so. Both Germany and the US will be seen as safe havens for capital and both auctions will be seen as equally successful. Obviously there will be a fluctuation in exchange rates as the results of each is released but I doubt very much that they will be market movers.

5 mins to beach, nice. i am 5 metres lol but i admit its much nicer where you are. i am off to olympics protecting someone later. I have my triggers sorted and as you let it go down, thats my preferance. Take care say

Spain raises its central government budget deficit target for 2012 to 4.5% from 3.5%

Europe had set a deficit target for Spain of 5.3 percent of G.D.P.

There is 0,8 % left for social security and regions.

Never gonna make that target !

Hahah That's good.

Good morning to you too PT. That walk to the beach sounds nice. But I think E/U will be fun today

good idea....

First half hour of LO: