someone mentioned here 1.34 by months end....let me tell you it is not a deranged idea
all things being equal if we continue in the same momentum, 1.3420 months end would be a fair call. assuming a linearity of price returns
best fit shows
intercept -.0005405 and slope .00005.349
seems to me that the downside momentum from 2011 reached its lowest in august and from there on price has undeniably been increasing. in other words the bearish downside has diminished. whether this will be a bull market or a ranging market is another story but key levels in my view are 1.25 and 1.34. However the coast is not clear yet 1.32 and especially 1.33 are big resistance areas.
so far there has been no significant systemic shocks....and Spanish bailout if anything will be seen as positive.
it is also positive that ECB has taken measures to step in and provide demand for sovereign debt due to this increasing liquidity of contracting economies in the EZ the M2 in the Euro area has been increasing and this has averted the monetary contraction.
as far as the fiscal cliff, has been avoided the debt ceiling might bring the markets down momentarily but generally high yields is what i believe continues to drive price. the big reversal will be in my opinion when the market starts pricing in FED rate hikes....so far the consensus is that ECB will not cut rates and this will continue to be euro positive.
all things being equal if we continue in the same momentum, 1.3420 months end would be a fair call. assuming a linearity of price returns
best fit shows
intercept -.0005405 and slope .00005.349
seems to me that the downside momentum from 2011 reached its lowest in august and from there on price has undeniably been increasing. in other words the bearish downside has diminished. whether this will be a bull market or a ranging market is another story but key levels in my view are 1.25 and 1.34. However the coast is not clear yet 1.32 and especially 1.33 are big resistance areas.
so far there has been no significant systemic shocks....and Spanish bailout if anything will be seen as positive.
it is also positive that ECB has taken measures to step in and provide demand for sovereign debt due to this increasing liquidity of contracting economies in the EZ the M2 in the Euro area has been increasing and this has averted the monetary contraction.
as far as the fiscal cliff, has been avoided the debt ceiling might bring the markets down momentarily but generally high yields is what i believe continues to drive price. the big reversal will be in my opinion when the market starts pricing in FED rate hikes....so far the consensus is that ECB will not cut rates and this will continue to be euro positive.
AVT INVENIAM VIAM AVT FACIAM
