Thursday, March 31, 2011

USD CONTINUES ITS GRIND LOWER

PRIMARILY CTA FLOW ON THE DAY SO FAR...



EURGBP BOUGHT AS END OF MONTH FLOWS GO THRU


EUR HICP FIRM HAS PUSHED EURIBORS LOWER EURUSD 1.4110>30


SO ALL IN ALL A CONTINUATION OF ASIAN SESSION PRICE ACTION

Currency stabilization becomes key topic

Tuesday, March 29, 2011

Gold & Silver Bullish reversal Candlestick pattern -Profit

Gold & Silver Bullish reversal Candlestick pattern (Morning star) -1h Timeframe


Closed with profit

Gold & Silver Bullish reversal Candlestick patterns 1h

Gold & Silver Bullish reversal Candlestick pattern  (Morning star) -1h Timeframe
Gold target:$ 1418 -stop loss: 1411
Silver target:  $36.9400 stop loss: 36.5050

AUD

Story to be aware of.


New state premier of NSW in Aus…announcing the discovery of a AUD4.5 bio hole in the state budget..prompting accusations from him that Labour were cooking the books etc and if they were revealed to the ratings agency back in Nov during a trip in Dec, a review of the state’s AAA status would have been triggered.



Switzerland - IMF Invites the SNB to Hike

The IMF, in its regular Article IV report on the Swiss economy, has invited the SNB to start to hike rates soon in response to stronger-than-expected real growth and “disappearing” slack.




Thursday, March 24, 2011

REAL MONEY A/C...adjusting hedges...this move now forcing med term funds into the mkt...not just a stop loss driven move any more.


Moody's ..on UK...

MOODY'S -
CONTINUED UIK COMMITMENT TO FISCAL CONSOLIDATION CRITICAL TO AAA RATING
- RISKS TO UK GROWTH SKEWED TO DOWNSIDE, ECONOMY PARTICULAR CHALLENGE AT MOMENT
 - RISK SLOWER GROWTH AND WEAKER FISCAL CONSOLIDATION COULD ENDANGER AAA RATING                                       
               not that helpful..post soft retails sales
 
On the Moody's comments about the UK. The rating agency has mentioned these arguments before but what matters is that it comes just after the Budget. It's not a great sign of confidence but Moody's is only talking about the risks, which has mentioned a number of times in the past.

Talk that Japan is checking USDJPY levels!


EUR lower on Portugal and Moody’s , but selling pressure been relatively light … EURJPY selling from CTA’s a small standout.


Wednesday, March 23, 2011

FT: Portugal crisis threatens to trigger poll:

We all know the issues with Portugal at mom, but this a handy article as a reminder of all the important names to look out for in this current bout of unrest on the Portuguese front....
  http://on.ft.com/h9XA4s              

Portugal crisis threatens to trigger poll                                 By Peter Wise in Lisbon
Portuguese opposition parties have refused to back austerity measures drafted to help the country avoid a bail-out, in a rebuff that could trigger both a snap election and an international financial rescue.
The political crisis in Lisbon threatens to dominate a European Union summit on Thursday, at which leaders hope to finalise "a grand bargain" to resolve the eurozone debt crisis.
Portugal’s cost of borrowing hit new euro-eras highs on Tuesday, with the yield on five-year government bonds rising above 8 per cent for the first time. The new austerity measures, designed by the minority Socialist government with input from the European Central Bank and the European Commission, the EU’s executive branch, are intended to reassure nervous markets that the country will meet its debt payments.
Senior political figures appealed to Aníbal Cavaco Silva, Portugal’s conservative president, to intervene to ensure the country was not left without an effective government ahead of the summit.
José Sócrates, the embattled prime minister, has refused to follow Greece and Ireland in seeking a financial rescue package. But opposition parties have refused to back a fourth austerity package, which could force the government to resign and trigger a snap election.
Pedro Passos Coelho, leader of the centre-right Social Democrats (PSD), the main opposition party, rejected a government offer for talks on the measures, saying an early general election was "inevitable".
Fernando Teixeira dos Santos, finance minister, said a political crisis would make it difficult for the government to finance its debt and could force Portugal to seek a financial rescue from the EU and International Monetary Fund.
Even if Mr Sócrates does resign on Wednesday, he would still be expected to attend the EU summit as Portugal’s outgoing prime minister in a caretaker capacity. It would then fall to Mr Cavaco Silva to decide whether to call an early election, which could take two months to prepare, or invite other parties to form a new government.
Marcelo Rebelo de Sousa, a senior PSD leader, called for a "grand coalition" between his party, the Socialists and the small conservative Popular party to ensure the strongest possible commitment to a credible deficit-reduction programme.
Mr Passos Coelho added that "a broad coalition for change" resulting from an early election would lend greater authority to Portugal’s deficit-reduction programme and provide "unfailing support to structural reform program aimed at fiscal consolidation, public debt reduction and economic growth".
The PSD has committed itself to the same fiscal targets as the Socialist government, which aims to cut the budget deficit to 4.6 per cent of gross domestic product this year and 3 per cent in 2012, down from 7 per cent last year.
But the party, which enjoys a lead in the opinion polls, said it could not support the government’s latest austerity measures because they were likely to prove "limited and ineffectual" and demanded unjust sacrifices from "the most vulnerable members of society".
Mr Sócrates, who has been in office for six years, has made it clear that he would fight for re-election as prime minister in the event of an early poll.

World Bank chief economist says CNY likely to become a global reserve currency


Tuesday, March 22, 2011

Yemen - the basics - why does it matter?

Yemen matters more to Saudi Arabia than Lybia:

Stats first:
1. Population: 24mio, which is huge around here. Same as Saudi or 5 times the UAE 2. GDP. Tiny, just $2600 per person 3. Oil. Negligible, 150k bpd (Saudi = 10mio) 4. NOT a member of the GCC 5. President Saleh. 32 years in power. Oversaw unification of North and South in 1990, survived the 1994 civil war

Why it matters to Saudi Arabia:
1. Al Qaeda. The links are strong, Bin Laden is a Yemeni 2. 1500km border 3. Oil tankers. Saudi tankers exiting from the Red Sea can only access the Indian Ocean by passing a strait between Djibouti and Yemen. As the Straits of Hormuz worry Gulf shipping and Saudi's Eastern oil fields, so this one worries Saudi's Western oil fields.

2. Last year Saudi used artillery and aircraft to strike at rebels in Yemen's north. US drones regularly do the same. They achieve little 5. It has the look of a failed state, with no route to success. The economy offers almost nothing beyond a great natural port in Aden and a stimulative plant called qat.

3. There's no easy solution. Yemen's mountainous North has never been conquered, even by the Ottomans. The next Afghanistan?

4. Which leaves only hope that Yemen's problems aren't exported. Tribal links to Saudi's South make that hope a forlorn one.


BOJ ...how much did they buy on Friday?

BOJ money market data suggests total of around 530 BLN YEN was sold in FX MARKET intervention on Friday so a lot less than the 25 bio mkt suggested.