EURUSD - Trends, Forecasts and Implications (Part 2) - page 707
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Just fractals...
I get it, thank you.
I told you I don't make predictions. I don't know when or where the rate will go. I'm standing up, but the TS is ready to turn around and go down..... Sort of like this....
I totally agree, I`ve been writing about it for a long time and I`ve been arguing with Strangeram from time to time)) But on short, I wait for the pullback and sell...
Totally agree that up, have been writing about this for a long time and argue with Strangerham periodically)) But on the short, I wait for the pullback and sell...
I do not think it is going in the wrong direction, not that kind of wave structure. Looks like the usual speculation and stop hunting. There is no "investor spirit" yet. Waiting
Price has breached the upper boundary of the triangle, opening down is now just as dicey as standing up.
Although there are no quiet roads in this forest at all.
Dow Jones Newswires column by Nicholas Hastings
LONDON, Nov 2 (ANI). /Dow Jones/. Love is blind. Investors betting on the euro rising are blind too.
Many of them still expect the euro to surpass the $1.40 mark again and go even higher after the U.S. Federal Reserve's Open Market Committee meeting ends this week.
They assume that additional monetary policy easing announced by the Fed will weaken the dollar, while the euro will be supported by the prospect of policy tightening in the eurozone.
Of course, recent economic data has calmed the bulls down a bit. On Tuesday, for example, the Eurozone manufacturing PMI was revised upwards significantly and the divergence between the peripheral debtor countries and the major economies was not as wide as many had feared.
Nevertheless, this does not mean that the ECB will be able to exit the super-soft policy as soon as many market participants expect.
At the moment the attention of most investors in financial markets, including those who bet on a rise in the euro, is captured by speculation as to what the Fed will do.
However, when Thursday arrives and the Fed announces the outcome of its meeting, their attention should turn back to local developments.
And then the bulls might not like what they see.
You can see on the chart how the Euro has been fluctuating around the $1.40 mark in recent weeks:
http://www.dowjoneswebservices.com/chart/view/4868
/continued/.
Over the past couple of weeks two issues have emerged that threaten not only the ECB's intention to tighten policy, but also the ability of the single European currency to show a serious recovery.
The first is the budget negotiations taking place in Ireland and Portugal and the growing discontent amongst the electorate that these governments are facing as they impose ever tighter fiscal austerity programmes.
In Greece, where popular unrest continues to pose a threat, Deputy Prime Minister Theodoros Pangalos last weekend allowed debt restructuring as an option.
"Demonising debt restructuring is wrong," he said, noting that debts should be restructured.
But it's not just the political situation in peripheral debtor countries that could undermine support for the euro.
There is an even more powerful statement from German Chancellor Angela Merkel that the risk of sovereign debt default remains and that a new crisis resolution mechanism must now be discussed.
By demanding new articles in the Lisbon Treaty that would place more responsibility on eurozone bondholders than debtor nations, Merkel not only acknowledges that the current bailout plan may be unfair to investors, but also opens the door to higher borrowing costs.
This was already evident this week when both Irish debt yields and the cost of insuring Irish bonds rose to new record levels.
Portugal has also seen an increase in both yield spreads and the cost of credit default swaps.
The fear now is that yield spreads as well as the cost of credit default swaps will widen further once the Fed meeting takes place and financial markets can turn their full attention to developments in the eurozone, including this weekend's local elections in Greece.
The government is threatening to call a general election prematurely if it does not get the necessary support on Sunday. This move can only create political tensions and exacerbate the euro's problems.
-Author Nick Hastings +44-20-7842-9493, nick.hastings @ dowjones.com; translation by PRIME-TASS; +7 495 974 7664; dowjonesteam @ prime-tass.com.
can now safely be either up or down)
can now safely be either up or down)