EurAnalysis

H^8 looking for W formation i think . take a look

I agree. I am currently long, looking to complete the double bottom W.

It is a low news day. I think NY will pull the price Up and your W will be completed.

Looking for a lower move before the bounce back up

Good morning everyone.

I hope you all had a pleasant weekend and have had plenty of rest & relaxation, because this week is going to be very interesting for risk sentiment... especially in the EuroZone.

This week (I believe by Thursday) the Spanish government is due to present its budget for 2013 and at the same time there is supposed to be some joint announcement from Spain and the Euro-group about the economic reforms that they have been working on ahead of any aid request that may (or may not) be made by Spain to the EFSF/ESM/OMT. The results of the banking stress test are also due to be released this week which should give us some indication (provided the results aren't fiddled with) as to how large the banking bailout will have to be. The key figure to watch for here is €100 bln because that is what has already been approved. A figure close to that (especially more) should send the markets free falling.

On top of that we are also looking for a report from the Troika regarding the state of affairs in Greece and how far behind the eight ball they are in their bailout program. There are reports that Greece has gone from a €5 bln budget gap earlier this year to a 13.5 bln gap to what now looks to be a €20 bln gap. However, this morning Greece denied that the gap is €20 bln. I believe them. How can it possibly be €20 bln. I think it's more like €30 bln.

To add some spice to the pot, Italy will be auctioning off 10 Year bonds on Thursday.

All this plus the usual verbal diarrhea from the talking heads should really bring some volatility to our charts and thus provide quite a few trade setups.

Today we start off the week with a relatively slow news day with just one high impact item at 8:00 GMT from Germany. The data we get today is the German ifo Business Climate index which is based on surveyed manufacturers, builders, wholesalers, and retailers. It is expected to be around 102.6 which would be a slight improvement from last month's 102.3. This index has been on the decline since it peaked out at 114.5 in June 2011 after hitting a low of 82 in February 2009. The last time it was at these levels was back in June 2010. After the dismal PMI numbers out of the EuroZone (with the exception of the German ones) as a whole last Thursday, it seems even more important now that Germany produces a good number today. Failing that, I feel that confidence will erode very fast. A good number would be expected at this stage so the risk is more to the downside.

From a technical perspective, The Euro bulls (Actually the risk bulls as a whole) are having a very hard time maintaining control as they have failed to keep price above the psychological 1.3000 level on a daily close basis, but more importantly on a weekly close basis. 1.3000 is not only of psychological importance but is rather also an important technical level area as it represents the neckline of the head and shoulders we had in Feb/Mar/Apr earlier this year. When the neckline was broken to the downside before the persistent decline to the 2012 lows at 1.2041, price failed to go back up and retest the broken support. That is what I call unfinished business and I can now say that it has been taken care of. If price manages to stay below, and further break below the 1.2920-1.2888 support area, that will put the bears in firm control in the short term.

The move up from the lows was a large persistent extended one with hardly any retrace to speak of since 1.2590 and has sliced through all the resistance levels as if they weren't even there. As such, I don't see much significant support between current levels and the breakout level of 1.2650 area which has yet to be re-tested as support. If the bears manage to maintain control of this market into the end of this week (which is also the last Friday in September), then I see a very good chance of seeing those orphaned levels very soon.

Best of luck today and trade safe.

Pete Jackson's Order Board:

EUR/USD: Offers 1.2980/00, likely buy stops through 1.3010 ahead of more offers 1.3040/50. Bids 1.2920/40 and 1.2900/10 sell stops below ahead of more bids 1.2855/65 and tech support at 200 day MA at 1.2828

Option Expiries @ 14:00 GMT:

EUR/USD: 1.2925, 1.2950, 1.3000, 1.3050, 1.3100, 1.3125

E/U Daily

GM PT - whilst 20 / 30 years ago it was normal for businesses to keep two sets of books - one to show to Hacienda - the tax ministry and the other the real picture - this is no longer possible due to much tighter controls and a legion of inspectors of all types making it impossible for any operation with employees to fly under the tax radar.

Additionally, the banks now report any cash transaction above €5,000, so whilst small scale cash payments still take place, IMO the shadow economy is now just a shadow of its former self.

Best regards and thanks for your hard work during the last year in keeping this excellent thread so active and such an outstanding forum for us all.

Islander

Good morning Islander,
Thanks for your response. I suspected as much. The shadow economy is probably now limited to undeclared casual or low pay employment and small cash businesses which really goes on in most countries anyway. Media like to hype things up. It keeps readers' attention to the fancy display ads beside the articles.
Best of luck today my friend. I am glad you find this thread of value.
Cheers
PT

Draghi wakes up or why there is a spike up??? :-)))

Low News day, buyers are suppose to counter

oh yeah. Germa IFO...it will be 0.4 better and we go up by 200 pips :-))
EU is safe! :-)

You're absolutely correct when it comes to BARCELONA only. Barcelona is waay different "from Spain". I have literally heard comments from Barcelona's residents that they do NOT consider themselves as being spaniards.

You are also correct that i have never worked in Spain. My comments are based on general knowledge, news and stories from people closer to the matter. Thus, i could sometimes jump into BIASED conclusions (By not being very thorough about Spain).

I'm glad that people (like you) very close to the matter can point to such events which, i'm sure, are educative to many of us.

Hmm, not sure about a 200 pips move, but surely it has some support behind and enough room for Up.

There is talk that the ESM may be leveraged 4:1
However, there is a catch.
The EZ governments will only be responsible for the 1 part and the other 3 parts will come from private investors. I am sure they are just lining up to invest money in junk bonds.

My vote goes to Lumesh, I don't always agree with him, but he has a good understanding of the underlying fundamentals.

That's quite funny. I told him that very same thing way back when I vouched him

No worries, CM, i fully understood it was a referred text.

I just THOUGHT at the beginning that it was your opinion but when i read further i got the message. All is good

So, it's clear - Thijs IS Piptrapper !


Other than that thanks for the support

yeah, i heard about that. All things being equal it would be an awesome hopium. However, it seems like we are left with an awesome catch...

German Ifo Business Climate 101.4 vs 102.6 expected and 102.3 prior.

...to IFO drop.