09:57CET
Below is the text f the weekly analysis prepared for Investors-Europe.com, updated each monday morning European time. FX ANALYSISLittle time to think Last week was one of those clear examples of what ‘stop hunting’ or ‘price aberration’ expressions do mean. The Euro, some will argue that in a technically justifiable note, rose to 1.4025 high vs. the US Dollar in an astonishing one-sided trading week, which saw the single currency appreciate by over 400 pips, that is, almost 100 per day. The so-much talk of a new round of quantitative easing by the Federal Reserve (QE2), is just putting more pressure to an already damaged US Dollar, only that this time not only the Euro zone, but many other economies, are complaining about that. The possibility of what some call a ‘currency war’ is not that far-fetched if we look at precedents in history. Technically speaking, however, and as the reader will easily identify by looking at the chart, this unit is technically in aberration mode, which means that at some point its moves can be wild and extreme, so in these cases is better for the dust to settle before turning aggressive in joining technical signals when they appear. --------------------------------------------------- Cable continues to show a rather better technical picture than that of the Euro, although its marching upwards has not been halted either. In the chart below one can see the technical difficulties which the unit is facing en route to the recent highs, and for now it seems that those technical instruments are doing a relatively good job. Cable’s upward momentum is safe for the time being, and would only be threatened by first a break of the 1.5600 handle and next and more decisively, by the break of the (now key) 1.5400 handle. Buyers are lining up around 1.5650, so longs should be considered if/when approaching that area. ----------------------------------------------------------- There is certainly very little that one can say about the behavior of the JPY crosses, and in particular of the USD/JPY. The USD is tanking vs. the rest of the currencies, granted. But that does not justify seeing the pair @ 81.30 (very near its all-time low @ 79.75), when just 2 weeks ago, the BoJ intervened in the market, spending over 25Bln, in order to try to prevent its currency from rising further. And that was @ 83…so in fact, what we have now the situation where the big speculators make fun of the BoJ and its interventionist tendencies, which is no good for the market image, and certainly creates the doubt of whether this one-sided market against the USD is not fabricated at all. ----------------------------------------------------------- WORLD MARKETS ANALYSIS
Equities hit new short-term highs The Dow Jones Industrial Average (DJIA), with no real technical barriers to put pressure on the upside, has continued to march higher, trading now above 11,000, and eyeing very closely the April highs around 11,200, which should put a bit of a fight, and perhaps even create an easier technical picture to analyze with. As said, technically speaking there is little to add for the time being, as there are no relevant resistance or support lines to discuss, and we can only talk of static levels. That said, 11,200 is the next main target and where all eyes are set. --------------------------------------------------------
Crude Oil down to magnet line as expected Crude Oil (WTI) made a good rally on Friday, but if we pay a more close attention to what the action was before then, we’ll see that the magnet line we said it would be important in the near future as it would not allow prices to climb fast and far from it, made its work and definitely halted the advance of prices, and prices could this week move below it. ---------------------------------------------------------------------- Gold (spot) hits record highs day after day, now above $1,360 Over $50 gained in just week in Gold. And it keeps on happening, day after day. It is somewhat odd having to analyze something that doesn’t want to be analyzed, that just wants to keep its moves one-sided, and not respecting techs. Therefore, it is to assume that techs will have a bit of a better importance once the presented uptrend line gives way…if it eventually does.
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