Home > Uncategorized > Brief Update: 2010/01/14: ECB No Surprise ‘No Action’ At 1.00% is a Prelude to Many Critical Late Week Influences, with a US Auction Anomaly Into Tomorrow

Brief Update: 2010/01/14: ECB No Surprise ‘No Action’ At 1.00% is a Prelude to Many Critical Late Week Influences, with a US Auction Anomaly Into Tomorrow

▪ The first of which is of course Monsieur Trichet’s post-rate decision press conference in progress at this time. However, even that press conference is accompanied by further important US economic data, which leads to a crescendo of US dominated fundamental influences tomorrow; with a special twist on the debt auctions side.

▪ Another downbeat Federal Reserve Beige Book yesterday (more so than previous) illustrated the degree to which the equity markets are happy to thrive on expectations of endless US central bank liquidity provision. That that in turn illustrates the degree to which the burden of proof remains on equities bears as those markets approach critical technical trend decisions (which also still have implications for the other asset classes.)   The March NASDAQ 100 future approaches a more important trend decision once again after its recent selloff from a new high into the 1,900 area on Monday was followed by a daily Close back below last Friday’s 1,890 closing price. That established a DOWN Closing Price Reversal (CPR)…

▪ The equities decision also remains very important psychologically for the other asset classes at this time, and nowhere more so than the debt trend tendencies after the key resistances were hit in impressively (in the face of equities strength) buoyant govvies… and after holding support noted previous either last week or earlier this week the March T-note needs to Close above interim 116-20 resistance to possibly retest its violated 117-24/-16 support. 

We will have much more to say tomorrow on why the US dollar may be in a win-win situation whatever equities decision might be; with the real issue being which other currencies it will thrive against depending on alternative trend scenarios for equities.

However, there is one other anomaly in the technical considerations for the market that may also be very telling for the government bond markets: the fact that this auction cycle has an accelerated settlement date,…

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