Today it’s a paradise for bats and weird lichen and fungus growth, with precarious seismic and flood situation – but but photographer found a way inside and (after taking haunting pictures) started making a “Fire Show”, turning the thick darkness into fiery magical “light painting”.
“All the darkness in the world cannot extinguish the light of a single candle”
Currencies: CAD and JPY outperformed overnight, while the EUR underperformed the pack. JPY strength and EUR weakness both emanated from ongoing concerns about the European bank stress tests due this week. CAD strengthened in both Asian and European trading.
EUR/USD. Failing at 1.30
EUR/USD (1.2801) is down overnight, again mostly in European trading, and spot didn’t even both to test 1.30 after runs at the level in the three prior sessions. The EUR is being weighed by concerns about the coming bank stress tests.
Technicals:
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Trend: Daily lower; Weekly higher.
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Overbought/Oversold (stochastics): Daily overbought; Weekly oversold.
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Support / Resistance Levels: Support for EUR/USD lies at 1.25 (psychological), 1.2152 (Jun 29 low), 1.1877 (Jun7 low), 1.1827 (Mar’06 low), and 1.1640 (Nov’05 low). Resistance lies at 1.3029 (Jul20 high), 1.3094 (May10 high), 1.3692 (Apr12 high), 1.3818 (Mar17 high), 1.4026 (Feb3 high), 1.4194 (Jan25 high), 1.4579 (Jan13 high) and 1.4626 (Nov low).
Positioning:
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The CFTC, EUR, non-commercial, net position (-28K) moderated sharply, in keeping with the EUR/USD rally through last Tuesday.
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The risk reversal (3m, 25delta) ticked lower with spot. The reversal is still heavily skewed for EUR downside, but it lies in the middle of its six month range – suggesting two way price action.
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Implied Vol (3m) rose overnight. It remains in the middle-third of its six-month range – plenty of two-way risk here.
Cross-asset valuation: The significant correlations that EUR/USD has during the past 60 days are the 10yr yield spread (positive), the US10yr yield (positive) and the SPX (positive).
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