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Charting Key Breakdown Levels In The EURUSD, The S&P, The VIX And The Spanish 10 Year
Looks like John Noyce's prediction, who among the Goldmanites, has long been bearish on the EUR, is about to be proven right. Below we present his latest technical observations not only on the key FX pair, but on the VIX, The S&P, and, perhaps most importantly, the Spanish 10 Year. In brief: if today's weakness is not contained, there could be a very signficant downside risk breakdown in numerous market indicators.
EURUSD – The underlying signals of a significant top in place look clear, but a few levels to watch.
- 1.4166 – Uptrend from the January ’10 low
- 1.3968 – Interim low from 23rd May
- 1.3810 – 200-dma
- 1.3571 – Uptrend from the June ’10 low
Since sending the bigger picture piece on EURUSD last Sunday/Monday a number of clients have asked about potential MT-LT (multi-week/-month) targets. The first real weekly chart support comes in 1.3558-1.3528 where the 55-wma and uptrend from the June ’10 lows are converged. Ultimately however if this is as big a topping structure as it appears to be, a move back towards 1.20 is something to consider.
VIX - For the first time since the drop in equities began from the 2nd May high the VIX is attempting to make a meaningful push through the highs of the range. This likely has important implications for risk appetite correlated FX pairs which are still in a “stretched state” in trend terms. USDMYR is the clearest example, it having spent a similar extreme period below its 200-dma to EURSEK prior to its recent sharp upside correction (further details below).
S&P – First good support below here 1,257-1,241. This is where the 200-dma, interim low from March and the primary uptrend from the March ’09 lows are converged. Although there are further meaningful supports down to the 55-wma at 1,217, a break of this support region on the daily chart would be the first warning of a more meaningful downtrend beginning, as opposed to the drop from the May highs being a correction within the broader uptrend. Again important for FX from a broad risk appetite perspective.
Spanish 10-year yields – Is the market about to break from the triangle that never seems to end? Since the November ’10 high at 5.58% Spanish 10-year yields have been forming a tight triangle consolidation, making repeated attempts to break both higher and lower. While it’s been incredibly frustrating, technically the greatest risk has continued to look to be for an eventual upside break, i.e. toward higher Spanish 10-year yields and also very likely (taking into account the setup on the spread chart) wider Spain/Germany spreads. The pivot to watch at this point is 5.53%, a break above there would give a triangle extension target in the region of 6%. As previously highlighted there’s still a relatively strong inverse correlation between the Spain/Germany 10-year spread and EUR/Crosses such as EURCHF. Overall, a break higher in Spanish 10-year yields would therefore quite likely have significant negative implications for the EUR.
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Let'em rip.
When will they listen to John Maynard and I????
We need stimulus. We need to print more money so we can fund all of those shovel ready jobs that need to be filled. This will save or create many millions of jobs by my caculations. Never underestimate the Keynes multipler...the mor $ printed the better things will be.
OT: Not to be forgotten, everyone's favorite black swan...
Flashes of Cherenkov radiation and recriticality at Fukushima going entirely unreported
http://hawaiinewsdaily.com/2011/06/apparent-explosion-and-fire-at-fukushima-4/
Probably transitory.
In any case: bullish !
Magical levitation all afternoon as the DOW reaches -200.
I have a serious question:
Can the movement in the EUR/CHF and USD/CHF FX pair be regarded as the inverse of what the movement of the gold price in € or $ would be, if it was only driven by supply and demand and not distorted by COMEX short positions ?
Both qualitatively and quantitatively ?
I mean gold is a scarce resource and the Swiss Franc is too.
The SNB, after unsuccessfully trying to print like crazy and buying Euros by the boatload which now rot on their balance sheet, has now given up on that and can only watch the Franc rise with despair as their Euros become ever more worthless.
Or is this comparison too far fetched ?
I have the same impression
Add oil to the picture, and the three seem to dance a tango...
If you have to ask, you can't afford it...
Sure it can and it has acted the way you describe. The reason has to do with "risk-on" vs. "risk-off."
The Swiss franc is now considered the world's most reliable currency and the action it is taking reflect an inverse correlation between risk and less-risk. It used to be the job of the US Dollar to be the safe-haven currency but that is no longer the case.
As the global perception of the US as "saviour to all economies" plants its feet firmer in cement, as illustrated by the pieces Tyler had at the week-end indicating that the US taxpayer has surreptitiously supported European banks to the tune of some $600 billion, the further the US dollar will decline. It has lost its safe-haven status because no one is sure what the Fed will do to shore up Greece, Portugal, Spain...you get the picture.
No one will be willing to give credence to a currency that is just giving it away. In the meantime, the Swiss franc fills the role of risk-off currency of choice, while gold fills the role of risk-on (speculation...) trades. What happens to the USD from here is anyone's guess.
:D
As for today,I believe the magical ES levitation is just about to start.
The DJIA bounces as if by magic every time it nears the -200 mark.
Gentlemen, the hard deck on today's mission is 1263.
Yeah, cause I bought few stocks there :))
Keep selling.
Regarding the Spanish 10 year, this is not a triangle, this is going to be just an island gap that is going to be closed downwards pretty soon.
You know, transitory.
Todays closing on spanish 10 yr was 5,548%
http://www.bloomberg.com/apps/quote?ticker=GSPG10YR:IND
Don't you just get the feeling "someone" is going make a Canuck like "stick save" between now and the close and if not, most certainly before tomorrow's US open after some kinda roiling this evening. Come on now,,,,,,,we've been here before. On with the Greek party, geeze!
Well, spanish 10 year bond now at 5.548% now...plus serious rioting in Barcelona (regional parlament besieged by protesters, mps have to go in and out by helicopter or poclice vans) plus rumous of an general election in the fall etc etc
More on VIX here, from a long term perspective:
http://karrpool.blogspot.com/2011/05/diary-entry-2-no-brainer-trade-of-2...
"S&P – First good support below here 1,257-1,241."
Draw trend line from April 2010 to April 2011
And lower trend line (parallel) from JUL 2010 to
2011 and that my lower target for S$P 1170 and Not
freaking 1000, Where is the Silver Chart?
Cause it can drop to about 23/oz by your charting
theory as well.. Be fair.. You don't have to promote
collapse and create panic. We have enough of it in reality
already.
right on...shoot the messenger...
I've got a question.
WHAT THE HELL WOULD WE BE DOING IF TD & ZH WEREN"T STAYING ON TOP OF ALL OF THIS?
on top of what, dude? Yes, Market is down today
and you are happy, check back 2010 summer..
plenty room to move down.. Today your conspiracy
theory works, let's check back tomorrow.
Enjoy bearning Americans 401k's..
The world is full of stupid assholes. What else is new?
that's exactly my point.
bearning?
maybe a combination of bear and burning?
I get no pleasure from the pain of others, but we are so unbelievably fucked that a 401K account is inconsequential compared to the doom about to be visited upon us.
But maybe you're right. Maybe all that matters is whether or not we're green tomorrow.
That is something I do not want to even think about. Been here almost 2 years and this site sure helps me sleep well at night.
And, we got Robot as a bonus. :)
could someone please explain the vix for me
what is it and how is it measured
Basically Volatility rising as Markets go down..
Check VIX there is options you can play on it..
But the problem is: with rising VIX option premiums
goes up accordingly so when Market rebound you can
lose that premium.. No free lunch here. I was trying to
protect some investments today via options and it's simply
impossible, prices for the options too high..
you can simply sell...
There you go mate:
http://en.wikipedia.org/wiki/VIX
.
Not sure what you're asking - but if it is about VXX don't play with it or any levered ETF. They are mathematical scams built by the big investment firms to steal investors money. They are built to approach 0 and pretty fast too. VXX has gone from a split adjusted 480 to 24 in a little over 2 years. It is a one day trade only.
Short those ETFs.
thanks guys for the info
It's time for the CNBS anchorettes to ask every day : "But is this the bottom?"
Of course the more appropriate question would be "Is this a great bottom or what?"
Sorry, but this is all news-driven price movements, not chart-driven.
Once again financials and materials leading the way down...the Pandora selloff is getting serious
--deleted reason: duplicate---
May I add -
TD & ZH are working their asses off for us.
i'll take Charts for $400, please, alex.
and the answer is: Bearish. slewie?
uhhnhh...is it bullish or bearish if the S&P 500 chart reminds you of the Mountain Climber Game on The Price Is Right?
it's 3PM. Critical levels everywhere. Smoke em if you got em kids...this could get weird:-)
Look at that huuuge tick volume in EUR/USD 15 minute. Might bounce very soon.
Not once have the idiots on the idiot channel mentioned that gold is "green".
they were not just frivolously granted the moniker of "the idiot channel"...they earned it.
Bet the Bernank is staring at these charts all day, sweating his ass off
Such total bullshit price action on SPY... being completely propped up every time it tries to break through support. The lie of SPY.
What is your problem? Are you short?
Wait for QE3 then, Ben will take care of you :)))
Stay long. QE3 is coming, I promise.
OPex
it's not SPY it's the SPX 1260 that needs to break...the rest will follow.
And even more important.../ES 1250 break will really send things into a frenzy.
Check July last Year. On SPX 200MA broken and ? It doesn't mean it goes to zero then.. Buy.. :) Worse case 1175 and by the way SPX and SPY the same sh*t
just SPY is SPX/10, get a clue..
I know SPX and SPY are the same thing you fucking tool. But SPY reflects SPX NOT the other way around.
Guys like you I like to fuck your wives.
Watch you mouth son, I don't have a wife, but you can became one, for my dog, if you gonna talk too much.
They (your Plunge Protection Team) have successfully defended SPX 1263 THREE times so far today. That just so happens to be the 200 day exponential moving average. Anyone who doesn't think this market is completely fake needs to have their head examined.
"They (your Plunge Protection Team) have successfully defended SPX 1263 THREE times so far today." Perhaps you should check your head, because not only you can read the charts. And people do play Support and Resistance.. Enough conspiracy theories.. You wanna make all the money shorting? Not going to be too easy for you.. Bernank should fry your butts at the end of the September.. All conditions are lining up for massive QE3.. all speculation of course, we'll see.. I'll keep buying PM's FU, doomsters..
Held it on a closing basis, but closed below previous ST support. Just above the 200dma too, as well as the lower Bollinger on the daily, but that’s after a multi-session countertrend rally that’s basically gone sideways. The bulls would love this to be a ST “base”, and the bears want to see it turn into a bear flag. The NDX says the bears might get their way, but BKX says maybe not. I think we get an answer sometime tomorrow.
Look at gold on the Comex, tell me that doesn't have manipulation written all over it.
why
should it be going up or down, cos right now it seems to be the most stable trade there is
Gold manipulation: a number of large US and foreign banks intervene in the gold and silver markets several times a week and sell 'short' gold or silver they don't have. This depresses the price. The pattern is quite distinct on the daily charts, typically (but not always) during US market times. This is a long topic - for more information go to GATA (Gold Anti Trust Action Committee) www.gata.org.
Gold manipulation: a number of large US and foreign banks intervene in the gold and silver markets several times a week and sell 'short' gold or silver they don't have. This depresses the price. The pattern is quite distinct on the daily charts, typically (but not always) during US market times. This is a long topic - for more information go to GATA (Gold Anti Trust Action Committee) www.gata.org.
Gold manipulation: a number of large US and foreign banks intervene in the gold and silver markets several times a week and sell 'short' gold or silver they don't have. This depresses the price. The pattern is quite distinct on the daily charts, typically (but not always) during US market times. This is a long topic - for more information go to GATA (Gold Anti Trust Action Committee) www.gata.org.
Don't forget the AUD/JPY chart. Key support at the 84 level holding as is the 100 level on t he CDX IG 16 index....http://rosenthalcapital.com/blog/2011/06/credit-carrytrade-preciousmetals/
@F'Stein #1372018
Long Nutella
No, it's SPY... every algo keys off of it. SPX means nothing to the algos. Notice the giant amount of volume it's taking in this last half hour to hold SPY right where it is.
So Moody's now threatening to downgrade French banks. Mon dieu!
Banks caught in storm"The ratings agency has now set its sights on banks with exposure to Greek debt – particularly French banks BNP Paribas, Société Générale and Crédit Agricole -- putting all three on review for possible downgrade."
http://www.theglobeandmail.com/globe-investor/markets/markets-blog/banks...
PPT trying to stick-save the close
Thanks ZH, to pay attention to the 10yrs spanish bond, gonna be so important for entering in a high volatility regime,
Regards,
Hugo
Thanks ZH, for paying attention to the 10yrs spanish bond evolution, gonna be so important for entering in a high volatility regime,
Regards,
Hugo
Equity margins will be lowered due to higher volatility. Ironically margins were raised in other areas for the same reason. Another day at the crooked casino.
Very bearish price action today.
Is this being "coordinated"?
Pack bags. The games over. The back of the rise since July 2010 has been broken come what may. Too many countries shifting gears and too few shots in the locker. All those central bankers who speculated so hard and based policy on a wing and a prayer are now redundant. The only question now is how low the market will go and how long it will take to get there.
Italian 10 yr has also hard time to decide whether to make it or break it.
http://www.bloomberg.com/apps/quote?ticker=GBTPGR10:IND
Bang up day for the USD.
Big daily stick in a possible middle wave position (as in a 3 of 3).
"This is PIIGS to base... black swans approaching fast at 11 O'Clock"
It never crossed anyones mind that this is not the end of the can kicking? c'mon.