EURUSD Melts Up But European Stocks Lag Into Weekend

Tyler Durden's picture


The week in Europe was a dispersed one. EURUSD is probably the story with its massive 1.6% rise against the USD (on what exactly? better PMI? come on? a totally useless summit that achieved nothing? or just good old repatriation as they sell out of their AAPL shares). Most European sovereign bonds ended the week unchanged - though Spain managed a modest 12bps compression in yield. Italy's equity market surged 3.6%, Spain's 2.78% but the rest are up less than 1% on the week. Today's trading was dead - almost totally flat in ever asset class with little volume - balanced between US markets sell off and China's overnight exuberance. Europe's VIX closed down around 0.7 vols on the week at 16.5% (but well off its Mondasy spike highs at 18.7%) - below US VIX! The broadest European stock index (Bloomberg's BE500) however has seen a slow drag in the last two days - notably underperforming credit on the week.


Europe's VIX closes below US VIX...


It seems the linear algos have EURUSD firmly in their control...


European Stocks...


European Sovereign Bonds...


European broad stocks notably lagging vs credit...


Charts: Bloomberg

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Fri, 12/14/2012 - 12:50 | 3062965 NaiLib
NaiLib's picture

They should. There is nothing good for Europe with a currency that goes up. France Spain and Italy deperately need a weaker Euro. The pattern of rising European indices, when Euro is up is simply wrong and created by a notion that a Weak USD means "risk on"

Fri, 12/14/2012 - 13:17 | 3063049 slaughterer
slaughterer's picture

A big gold-weighted HF wants to trim down its GLD by 21st Dec.  Watch out.   

Fri, 12/14/2012 - 12:51 | 3062966 CrashisOptimistic
CrashisOptimistic's picture

Not rocket science.

Greece got the money.  It's nothing but that.

Fri, 12/14/2012 - 12:51 | 3062971 GoldbugVariation
GoldbugVariation's picture

It's purely technical - EUR/USD crossed a resistance level (upper trendline) at the 131.15 level. It jumped $0.30 points in the space of one minute, a fairly large move for the euro but not unprecedented.

Fri, 12/14/2012 - 12:55 | 3062990 youngman
youngman's picture

Nothing like a high priced company stock with a failing country economy

Fri, 12/14/2012 - 12:58 | 3062997 buzzsaw99
buzzsaw99's picture

well on the way toward parity [/lulz @ citifx]

Fri, 12/14/2012 - 12:59 | 3063002 RobotTrader
RobotTrader's picture

Foreign markets now outperforming U.S.


China had one of the biggest up days in history last night.


Spanish bank stocks are pretty much outperforming everything the last 6 months, BBVA and SAN on epic meltups.


While PM stocks still grinding it out at depression level lows.


Stackers and Preppers must be pulling their hair out.

Fri, 12/14/2012 - 13:03 | 3063008 buzzsaw99
buzzsaw99's picture

goldbugs threw in their lot with j. paulson and g. soros. the irony, it hurts!

Fri, 12/14/2012 - 13:10 | 3063026 akak
akak's picture

Fuck off RoboTShitforBrains

Does your terminally and idiotically shortsighted timeframe EVER extend more than 24 hours into the past, or the future?

Fri, 12/14/2012 - 13:05 | 3063013 Lord Peter Pipsqueak
Lord Peter Pipsqueak's picture

Massive inverted head and shoulders breakout on both EUR/GBP and EUR/USD today,next week or two should prove whether it's real or not,but with the Greek bailout now done and dusted and Bernanke doubling up on monthly bond buying -i.e unsterilised,and Goldmans moneyprinter Carney saying the BofE should target growth or other metrics instead of just the current 2% inflation,it looks like a slam dunk one way winning bet to buy Euro's for me.

Fri, 12/14/2012 - 13:17 | 3063053 slaughterer
slaughterer's picture

EUR/USD will top at 1.32.  Then revert.  

Fri, 12/14/2012 - 13:18 | 3063039 Quinvarius
Quinvarius's picture

Shortly after QE3 was announced, a Fed member flat out said the intent was to devalue the dollar in a speech.

Do you think they will fail at this now that they have dumped QE4 on top?

Fri, 12/14/2012 - 13:17 | 3063052 SmoothCoolSmoke
SmoothCoolSmoke's picture

Damn!  That thing is going thru the roof.

Fri, 12/14/2012 - 13:21 | 3063062 magpie
magpie's picture

Dollar imploded this badly to keep the market...stagnant

Fri, 12/14/2012 - 13:39 | 3063131 sixbilliondollarman
sixbilliondollarman's picture

What a beautiful daily DOUBLE TOP to sell into for that piece of shit currency.

Continential Europe is broke & idiots buy the Euro...

Face the facts: EVERY MARKET PRACTICALLY [besides Gold & Silver] ARE CENTRAL BANK SUPPORTED...IF THEY DIDN'T...all would wipe out wholesale.




Fri, 12/14/2012 - 19:16 | 3063426 zoggl
zoggl's picture

"EURUSD is probably the story with its massive 1.6% rise against the USD (on what exactly? better PMI? come on?"

I'm sick and tired reading this EURUSD stories from ZH. As if they have never heard of manpulative currency devaluation. There is absolutely no point in speculating against either of these currencies, because if one goes up to much, it gets trashed and vice versa. Who at ZH is writing this BS? The reference for the Euro and USD are hard assets, not Fiat.

Fri, 12/14/2012 - 14:43 | 3063509 q99x2
q99x2's picture

Fixin to get me a Government job.

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