EurAnalysis

Hey traders,

August was a cruel mistress to me, my confidence is quite down. The result = not following plan due to fear of taking another loss.

Simple chart:

http://www.forexfactory.com/attachme...1&d=1346470354

Geezzz, not only me...

don't lose confidence, either take a break or keep following your plan

ATTENTION ALL LURKERS AND NEW POSTERS

BEFORE POSTING ANYTHING IN THIS THREAD, YOU MUST READ AND AGREE TO ALL THE RULES AND OBJECTIVES POSTED ON PAGE 1

CURRENT POSTERS WHO HAVE MADE SIGNIFICANT CONTRIBUTIONS TO THIS THREAD ARE GIVEN A FRIENDLY NUDGE WHEN THEY STEP OUT OF LINE.

HOWEVER, NEW POSTERS DO NOT GET A SECOND CHANCE. YOU ONLY GET ONE SHOT AT MAKING A FIRST IMPRESSION, SO MAKE IT A GOOD ONE.

THANK YOU
~

I'm assuming thats me PT. Posting charts on something other than Euro? Although I have seen you do it as well in this thread so I thought no big deal.

If not me, never mind then.

Seems PT having his weekend fun

Edit: On the second thought PT is closed to his 10,000 post

No it is not you.

PT is posting that warning post to let any trolls who want to disrupt this thread know they would be quickly dispatched with a trip to the "IGGIE" list without warning.

Anything that may effect the EUR/USD is fine to post, and it is open discussion on the weekends until markets re-open.

You have not violated any rules of thread.

Keep up the good work!

I see you down there sneaking up on me kinky!

Hope you are having a great weekend!

What Gopher said
Signed: PimpTrapper


ADD: Top of page

ADD2: only 4 more posts to 10,000

PT- your even a pistol on the weekend!

Make the 10,000 one any post you want to post.......that does not violate thread rules!

since its weekend, we should make a prediction when it really starts to fall

in my opinion 7 september gonna be very important date for bears, before that it will probably rise very slowly.

also Non-Farm Employment Change expectation is 121K, last month was 163K, what if NFP goes worse and Unemployment Rate stays same ?

Can't wait to find out the speculation on Gold and Silver, long USD and Yen

What you say Gofer, inflation or fear

Markets Entering into a Crucial Month

After much anticipation, Fed Chairman Bernanke finally delivered his speech in the Jackson Hole Symposium. Did he disappoint? Judging from the reactions in the markets, he didn't. The biggest reactions were firstly found in treasuries where 10 year yield dived to close at the week's low at 1.562%, down from prior week's 1.678% and compared with August's high of 1.863%. 30 year yield also tumbled to close at 2.684%, also at the week's low. That compared to prior week's close of 2.792% and August's high of 2.984%. Secondly, gold rebounded strongly to close at 1687.6, comparing to intraweek low of 1647.1. Both are clear reflection of intensified expectation of additional quantitative easing from Fed. Stocks did rebound too but both DOW and S&P 500 were limited well below August's high, suggesting that investors might not be too convinced about the effect of another round of QE, and are hesitating ahead of an important month. In the currency markets, the weakness in USD/JPY was most apparent after Bernanke but Kiwi and Aussie were the weakest currency in the week as a whole.


Technically, dollar index's development last week affirmed the case of medium term reversal and raised the chance of falling back to 80 and below in near term. In other words, EUR/USD's rally will likely continue following broad based weakness in the greenback. But we'd tend to avoid European majors again based on the uncertainties ahead.

Meanwhile, further intensification of QE3, as triggered by economic data like ISM indices and NFP this week, should benefit yen most. And based on recent weakness, should disappointing economic data pressures stocks, Aussie and Kiwi will be hit hard again. Indeed, Aussie is vulnerable to a gap down opening as China PMI manufacturing released on Saturday showed deeper than expected contraction at 49.2 in August. So overall, we'd continue last week's strategy in preferring to short AUD/JPY in near term.


September will be an important month to the markets considering the key events scheduled. Starting with US first. Bernanke didn't hint on when will Fed implement new stimulus program, and what to do in his speech Monetary Policy since the Onset of the Crisis in the Jackson Hole symposium. But he did somewhat set the stage. He noted that there is "no net improvement in the unemployment rate since January." And, "unless the economy begins to grow more quickly than it has recently, the unemployment rate is likely to remain far above levels consistent with maximum employment for some time." And more importantly, Bernanke said that the "stagnation of the labor market in particular is a grave concern not only because of the enormous suffering and waste of human talent it entails, but also because persistently high levels of unemployment will wreak structural damage on our economy that could last for many years." "Grave concern" was cited by some analysts as the strongest word Bernanke has ever used regarding the dire situation in employment.


Remember that in the minutes for August FOMC meeting, "many members judged that additional monetary accommodation would likely be warranted fairly soon unless incoming information pointed to a substantial and sustainable strengthening in the pace of the economic recovery". The overall situation makes this Friday's August payroll report even more important. Markets are expecting the US job market to grow 127k. And it's speculated that a sub-100k number will tremendously add the odds of Fed easing in the FOMC meeting on September 13. Also, Fed will release revised projections at Bernanke's post-meeting press conference.


There are also a number of key events in Europe in September. At this point, we're still facings the many questions. Will ECB restart the bond buying program? Will ECB target to cap yield, or in what form the bond buying would be? Will Spain apply for a sovereign bailout eventually. And, could Greece secure the next tranche of bailout fund and successfully seek extension to its fiscal adjustment program? Hopefully, we'll get clear answers this month.


The first key events in Europe will be this Thursday's ECB meeting. Expectations are high on Draghi to deliver the details of the prospective bond-buying program as he cancelled his trip to Jackson Hole Symposium for "heavy work load". In an article titled "The future of the euro: stability through change", Draghi pointed out that fulfilling the central bank's mandate "sometimes requires us to go beyond standard monetary policy tools." Current financial markets are "fragmented or influenced by irrational fears". And, that affect the transmission of ECB's monetary policy. He also said that such "blockages" need to be fixed to "ensure a single monetary policy and therefore price stability for all euro area citizens."


However, we'd like to point out again there have been talk that ECB could announce the program only after Germany Constitutional Court's ruling on legality of ESM on September 12. Meanwhile, ECB could cut the key interest rate by another 25bps to a new historical low of 0.50% this week. Then, after German court ruling, Eurogoup and finance ministers will meet on September 14/15. Using EFSF/ESM to purchase bonds should be discussed there. There would also be discussion on Spain as well as on Greece. Talking about Greece, troika will deliver the final report on Greece's reform efforts. The report would be crucial in determining whether Greece could at least get some easing on program requirements ahead.

http://www.actionforex.com/action-in...0120901173413/

Even this seal had to laugh at all the precious metal price management non-believers.

http://www.caseyresearch.com/gsd/sit...OL-470x299.jpg

Reader Scott Pluschau sent me the graph below...along with the comment..."Nothing is ever certain in the charts, but let me just tell you that if I was a bear or a short in gold, I would be praying for intervention over the weekend looking at this chart."

Above From Ed Steer - Thanks

VERY VERY VERY IMPORTANT !!!

http://www.prudentbear.com/index.php...w?art_id=10702

Risk #3

 

1. by Doug Noland
2. August 31, 2012

August 30 – Bloomberg (Mark Deen): “Yale University professor Stephen Roach said Federal Reserve Chairman Ben S. Bernanke shouldn’t be given a third term because of his role in managing the U.S. economy before the financial crisis. ‘I think Bernanke tried his best post-crisis, but he’s part of the problem pre-crisis,’ Roach said… ‘He and Alan Greenspan condoned asset bubbles at a time the economy needed more discipline.’ …For Roach, Bernanke’s work to calm markets following the financial crisis doesn’t mean his part in inflating asset bubbles in previous years should be overlooked. ‘To reward him for post-crisis, very valiant efforts of public service completely overlooks the role he played in getting the U.S. asset markets and an asset-dependent economy into this mess in the first place…”

Chairman Bernanke titled his 2012 Jackson Hole presentation “Monetary Policy since the Onset of the Crisis.” His review begins with the Fed’s initial response to the unfolding mortgage crisis in August 2007. The paper then details five years of policy measures, with section headings “Balance Sheet Tools,” “Communication Tools,” “Economic Prospects,” and “Making Policy with Nontraditional Tools: A Cost-Benefit Framework.” Dr. Bernanke concludes with coded dovish messages, including “grave concern” that “high levels of unemployment will wreak structural damage” – after earlier signaling support for the Draghi Plan (“recent policy proposals in Europe have been quite constructive in my view, and I urge our European colleagues to press ahead…”).

As noted above by the astute Stephen Roach, Dr. Bernanke played an instrumental intellectual role in crafting policy with Chairman Greenspan that fatefully nurtured the mortgage finance Bubble. In arguably history’s greatest monetary policy misadventure, the Greenspan/Bernanke Fed purposely ignored the unfolding Bubble, choosing instead to commit the Federal Reserve to aggressive post-Bubble “mopping up” strategies. Five years into the crisis, the extent of required “mopping up” remains an unfolding saga that will be analyzed and debated for decades to come. To be sure, the Federal Reserve’s framework for monetary policy cost-benefit analysis during the post-technology Bubble reflationary period (2002-2007) was an abject failure. Most of us strive to learn from our big mistakes.

Chairman Bernanke, not surprisingly, made it clear in Jackson Hole that he is prepared to move further into the uncharted waters of “non-traditional” monetary tools. His review came out on the side of benefits outweighing “manageable” costs, although perhaps to placate the hawks he cautioned, “The hurdle for using nontraditional policies should be higher than for traditional policies. At the same time, the costs of nontraditional policies, when considered carefully, appear manageable, implying that we should not rule out the further use of such policies if economic conditions warrant.”

Before delving into his cost-benefit framework, it is worth mentioning that the word “Bubble” is nowhere to be found in Bernanke’s paper. I strongly argue that the issue of whether the Fed is once again accommodating a Credit (“government finance”) Bubble is today’s prevailing – potentially catastrophic - policy risk. The possible role that non-traditional policy tools might be playing in nurturing Bubble dynamics should be the focal point of any cost-benefit analysis related to the Fed’s experimental policymaking endeavor. Regrettably, it’s completely disregarded - hear no evil, speak no evil, and see no evil.

Dr. Bernanke highlights four potential costs of large-scale asset purchases (LSAP): 1) Impairment to the functioning of securities markets (“Fed dominance” “degrading liquidity and discovery”). 2) Substantial Fed balance sheet expansion could reduce public confidence (i.e. exit strategy and inflation expectation issues). 3) Risks to financial stability (i.e. “could induce imprudent reach for yield by some investors”). 4) “The possibility that the Federal Reserve could incur financial losses should interest rates rise to an unexpected extent.”

I take exception with those calling Bernanke’s presentation “balanced.” He again misjudges and woefully understates risk. My analytical focus is directed at Risk #3, with the view that the Bernanke Fed is again disregarding myriad risks to financial stability associated with marketplace interventions and manipulations. Indeed, it would appear that risks to financial stability are escalating in concert with the escalation in the course of global monetary management. Dr. Bernanke’s “imprudent reach for yield by some” contrasts with my fear of the greatest financial Bubble in the history of mankind.

PLEASE READ ON ...

http://www.henryliuforex.com/7302/fo...mber-3-7-2012/

Market remained in a tight range once again this week, as traders hoped for the much anticipated Fed’s Jackson Hole Symposium to provide a sense of direction. However, market could only be described as “confused” towards the end of the week, after Bernanke’s speech, as the Fed Chairman provided no confirmation for a September QE3, although he did reiterate that:

“Cannot rule out more use of non-traditional policies, negative risks of more stimulus are manageable”,

Markets initially took this as hint of more easing, but soon realized that Bernanke just ran a full circle around them… at the end of trading day, USD recovered some of the initial losses for the day as prospects for a potential QE (quantitative easing) in 2012 falls to all time low… Although this outcome has been well predicted ahead of the speech, as most analysts concluded in mid week that it’s highly unlikely for any new policy initiatives to be announced this Friday, traders still managed to push EURUSD above the 1.2630, breaching the psychological 1.2600 level and remaining above it even after the speech… Click here for the post Bernanke Jackson Hole Speech analysis…

Conclusion:


In conclusion, I believe we should exercise caution this week, not only because of the sheer number of high-impact releases scheduled this week, but because of the potential of these events to change the landscape of the market for the rest of the year. I would be looking to buy EUR on dips, on the fact that traders are expecting ECB to act. The fact that Draghi decided to cancel his trip to Jackson Hole speaks loudly, and when you also consider a press report released at the end of the trading day on Friday: ”ECB is said to be planning to hand over new bond buying plans to member central banks on Sept 4th, central banks to have 24 hours to review and digest the plans ahead of ECB policy meeting”, I believe the market will be pleasantly surprised as ECB announced new SMP program to be activated after the German court decision… In any case, even if the ECB Press Conference turns out to be uneventful, market should still buy EUR ahead of the meeting, thus I see no reason not to buy EUR on dips.

As far as USD is concerned, I believe it will gain against some currencies, such as the JPY, AUD, and CAD while lose against others, such as EUR, CHF, and GBP. The key focus will be on Friday’s NFP, which will seal the deal for the USD as an above 100K release would mean no QE3 for 2012, and I’d be looking to go LONG on USDJPY as this pair has the potential to move beyond the 84.00 level in the next couple of months. As far as GBP is concerned, I’d be looking to buy on dips, because it is likely to follow the direction of the Euro. Of course, Sterling should also get a boost from its July/August economic indicators as the positive effects of the Olympic Games keep UK’s economy afloat. CHF is likely to remain bullish, especially against the USD as EUR makes its way back to the 1.3000 level. My view is to sell the USDCHF pair on any significant rally. AUD and NZD should remain under pressure, as a strong USD drives both commodity and risk currencies lower. I am recommending to sell AUDUSD on rallies, as the break below 1.0400 marked a turning point for the pair both technically and fundamentally, and that’s not even considering the slow down in China and the stockpile of iron ore. JPY is likely to remain range bound, especially considering the amount of risk events scheduled for the week… All in all I’d recommend to short the JPY on rallies, or go LONG on USDJPY if the pair tests the 78.00 again. With Japanese government watching the pair closely, I believe we won’t see any sudden strength in the Yen unless there are new developments. CAD is likely to weaken on the back of stronger USD, although BOC may once again blur out hawkish comments and drive CAD stronger temporarily, I honestly don’t see CAD beyond the 1.0000 level for long…

We have a busy week scheduled, with 14 high-impact events, they are:

1. Mon September 3, 2012 – 4:28am EST – UK Manufacturing PMI
2. Tue September 4, 2021 – 12:30am EST – AU RBA Interest Rate
3. Tue September 4, 2012 – 10:00am EST – US ISM Manufacturing PMI
4. Tue September 4, 2012 – 9:30pm EST – AU GDP q/q
5. Wed September 5, 2012 – 4:28am EST – UK Services PMI
6. Wed September 5, 2012 – 9:00am EST – CA BOC Interest Rate
7. Wed September 5, 2012 – 9:30pm EST – AU Employment Change
8. Thu September 6, 2012 – 7:00am EST – UK BOE Interest Rate
9. Thu September 6, 2012 – 7:45am EST – EU ECB Interest Rate
10. Thu September 6, 2012 – 8:15am EST – US ADP NFP Employment
11. Thu September 6, 2012 – 8:30am EST – EU ECB Press Conference
12. Thu September 6, 2012 – 10:00am EST – US ISM Non-Manufacturing PMI
13. Fri September 7, 2012 – 8:30am EST – CA Employment Change
14. Fri September 7, 2012 – 8:30am EST – US Nonfarm Payroll (NFP) Employment

Key events this week are ECB Rate Decision/Press Conference and Nonfarm Payroll reports, as the market will undoubted try to price in sentiments ahead their schedules. I’d recommend to use caution.
Thanks,

http://www.henryliuforex.com/wp-cont.../henry-sig.gif

I understand there are gold bugs and precious metal traders out there. Let me get my crystal ball out:

They are in a bubble! Let me repeat, they are in a bubble!

These are commodities. Value is based on a fiat currency. There is not enough gold in the world to have a totally gold based monetary system. Period! If we did not have our government controlling currencies and rates, then the gold miners would control the monetary system through simple supply and demand.

You want to get rich with a commodity, then buy bullets, water and simple food that can be preserved for long amounts of time.

You cannot eat gold, so in common sense, it has no value to a hungry or desperate person. If things are as bad as the doomsayers say, gold would be the last thing I would consider buying. Why? Because if I have the biggest gun with the most ammunition and some supreme power said that gold was important to have.....I'd just go take what I needed or wanted.

I am a firm believer....nothing holds value unless we say it does as a collective. We assign value to scarcity or abundance of what we say holds value.
So, as an exercise in thought........If I owned all the corn seeds in the world, and I have genetically engineered them that they can only produce for one generation, and I say the most valuable thing in the world is corn as it feeds our animals, used to produce energy, and is used to feed ourselves, I would bet I could take control of as much gold as I wanted.

Respectfully, and, IMHO, with this mindset understand that I find all the gold posts a waste of my time to read, so please do not take this as an attack on you or your views, because if we did not have different views that were counter to one another, we would not even have a market to trade in.

I see gold as a good value at around $800 and overpriced above $1300.00.
This is an opinion and I welcome any respectful, thoughtful debate.

I have enclosed a link about gold and the monetary system. I will allow the reader to draw their own conclusions.

http://www.wealthmoney.org/enough-gold-money-system/

Hi Scott Pluschau,

I see this as an opportunity to sell gold when demand is high. I will sell more if price is getting higher. As gold is commodity not leveraged the way I know as for currencies, maybe praying is not necessary. Also by using one of the dormant accounts will not disturb the cashflow. I will buy back when people needs to exchange it for cash at lower price. It could be six months or a year from now but hopefully won't take that long

Thank you CurrencyMan to relay this to Scott.

I am off to bed now. When I awake later this morning I will post my views on Gold and where we see things in a different way. I welcome the opportunity to discuss it further. Good night and thanks for your point of view.

CM

Reader Scott Pluschau sent me the graph below...along with the comment..."Nothing is ever certain in the charts, but let me just tell you that if I was a bear or a short in gold, I would be praying for intervention over the weekend looking at this chart."

http://www.caseyresearch.com/gsd/sit...rt-469x330.png
(Click on image to enlarge)

Being a Saturday and all, it's the day I get to dump the entire contents of my in-box into my column...and there are quite a few that I've been saving all week for just this moment.

Today 50 year veteran Art Cashin shocked King World News by speaking about the most disastrous economic event in the history of the United States. Cashin said, “The most disastrous thing economically that happened in this country, happened in August of 1971, when they came off the gold exchange standard.”



Cashin, who is Director of Floor Operations for UBS, which has $612 billion under management, also warned, “I’m not sure that the leadership is alert enough to be able to implement the gold standard again, but they should really consider, at least, returning to something like the gold exchange standard.”



But first, when asked about how long and brutal this cycle is going to be for the disappearing middle-class and people who are suffering around the world, Cashin responded, “We’ve got a couple of things going here. In the stock market, traders think of something called the 17.6 year cycle. The feeling on Wall Street is that you go through these 17.6 year cycles, where you have a ‘fat’ cycle, where you can pick almost any stock you want and it will go up.”







http://kingworldnews.com/kingworldne...peimage_22.png

http://kingworldnews.com/kingworldne...S_History.html

The most disastrous thing economically that happened in this country, happened in August of 1971, when they came off the gold exchange standard, whereby foreign governments and others could come in and present dollars and request gold.



When they went off that (the gold standard) there was no more discipline or control. That is what led to the huge inflation we saw in the 70s, and gave us a very spotty market. Volcker managed to wring most of that inflation out, very painfully. Now we are liquidating the debt of the housing bubble, and even some remaining debt from the dot com bubble.



These are difficult times. They’ve certainly proved that we need more discipline. I’m not sure that the leadership is alert enough to be able to implement the gold standard again, but they should really consider, at least, returning to something like the gold exchange standard.”



Cashin also warned: “This (Syria) could turn into a very ugly Lebanon, very quickly, and thereby destabilize the entire Middle-East. And I don’t think protection against that is priced anywhere in these markets, with the possible exception of the premium price for oil.”



This is an extremely powerful and timely interview with Art Cashin. Cashin spoke about the ongoing crisis in Europe, problems facing the US, Bernanke, as well as other central planners and what they are up to, the gold standard, geopolitical problems and more. He also discussed oil, global stock markets and what KWN listeners should expect going forward.



This is an interview KWN readers and listeners globally will not want to miss. The King World News interview with Art Cashin is available now and you can listen to it by CLICKING HERE.