Posts by "stationdealer"

Greece's borrowing costs sink after euro deal
this minute

(AP:ATHENS, Greece) Near-bankrupt Greece's borrowing costs fell sharply Monday and stocks rallied after the European Union unveiled a $1 trillion plan to contain the continent's spreading debt crisis and boost the euro.

The difference between yields on Greek 10-year bonds and their benchmark German equivalents was at 4.72 percentage points, down massively from a record 10.25 points on Friday. The general share index on the Athens stock exchange gained 9.59 percent in morning trading, reaching 1,786.84 points.

Under the three-year plan adopted in Brussels early Monday, countries from the 16-nation eurozone would promise backing worth euro440 billion ($560.8 billion) for troubled governments. The IMF would contribute an estimated additional euro250 billion ($318.65 billion) and the EU euro60 billion ($76.5 billion).

Separately, eurozone leaders on Saturday gave final approval for a euro80 billion ($100 billion) rescue package of loans to Greece for the next three years to stave off default. The IMF also approved its part of the rescue package _ euro30 billion of loans _ on Sunday.

Last week, global markets suffered big losses and the euro plunged on fears the Greek debt crisis could spread to other weak European economies.

Greek Finance Minister George Papaconstantinou said Monday the agreements meant his country would have no trouble paying off creditors.

"Over the next few days, payment will start of the first section of the loans from the European Union and the International Monetary Fund, so that the country has no problems whatsoever with its borrowing needs and servicing its debt this month, and for months to come," Papaconstantinou said.

Greece was forced to stop borrowing from international markets after the interest demanded by investors to buy its bonds skyrocketed, reaching more than 4 times that paid by EU powerhouse Germany.

The international loans were the country's only shield against bankruptcy on May 19, when some euro9 billion in debt must be redeemed.

In return, Athens announced new painful austerity cuts over the next three years, prompting union anger and violent protests last week in which three people died.

At a cabinet meeting Monday, the center-left government is set to approve key pension reforms, cutting payments and increasing retirement ages.

Before then, President Karolos Papoulias will host a meeting of party leaders on the debt crisis, which left-wing parties are boycotting.


Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Talk Of Barrier Option Interest In EUR/USD

At 1.3100, which explains dip back from 1.3093 session high. Bit of protection going on. Were presently at 1.3073. So far Libor is still up that will change through the Greek payment process.

We are in Buy buy buy on every dip.

"May 10 (Bloomberg) -- The U.S. Federal Reserve will restart its emergency currency-swap tool by providing as many dollars as needed to European central banks to keep the continents sovereign-debt crisis from spreading." Thus surplus dollar floats back into the market, that will cheapen dollar further!

There are many different investment vehicles one can use to invest in gold. The key aspects that we as investors and traders look for are the vehicles relationship and correlation with gold prices, and how much that correlation is or isnt leveraged to the gold price. More leverage is not always the objective of an investor, one may be looking for less sensitivity to the gold price, or simply to match golds performance. The value of common stocks relative to Gold is about to accelerate in the opposite direction the Larry Kudlow and Jimmy Jack Cramer crowd are expecting. The concept of relative wealth is an important one for Gold bulls to comprehend and embrace, as it allows them to calculate gains in something besides unstable paper debt-backed fiat currency, which is a worthless measure of value. In other words, it negates the need to worry about the inflation-deflation debate.

The best example of this mental calculation of value is the Dow to Gold ratio. The average American, if they still have a job and any savings left, puts their excess money in stocks, real estate and/or government bonds. This is the absolute wrong thing to do, but the average American paperbug has been indoctrinated beyond what seems possible. Like members of the Jim Jones cult, most Americans are paperbugs and all-too-ready to drink the apparatchik Flavor Aid being served in public schools, on the nightly news and by mainstream financial publications that employ ignorant commentators who preach "stocks for the long haul and everything will always be OK or better than OK".

The bottom line is a simple but powerful concept: Gold will continue to increase in value relative to general stocks, real estate and government bonds, as it has over the past decade. This isn't rocket science, it is simply the swinging pendulum of financial history. Trust me when I tell you that you don't want to "buy and hold" Gold forever as an investor with a finite lifespan (unless you're certain to staty alive in the next 10 years...).


For now Euro still BUYs

The Swiss franc depreciated vis--vis the U.S. dollar today as the greenback tested offers around the CHF 1.0945 level and was supported around the CHF 1.0840 level. Data released this weekend confirmed the Swiss National Bank has spent more than CHF 40 billion to buy euro this year with CHF 30.2 billion in franc sales in the first quarter alone. Data Swiss National Bank President Hildebrand last week said the SNB will continue to counter any excessive gains of the franc, noting there would be a negative impact if the franc appreciates sharply due to its role as a safe haven currency.

Hildebrand noted the SNB will not allow such a development to turn into a new deflation hazard and is acting decisively to prevent an excessive appreciation. Hildebrand also called on European leaders to conclude negotiations over Greeces aid package rapidly. April consumer price inflation data will be released on Thursday. U.S. dollar offers are cited around the CHF 1.0930 level. The euro moved lower vis--vis the Swiss franc as the single currency tested bids around the CHF 1.4320 level while the British pound appreciated vis--vis the Swiss franc and tested offers around the CHF 1.6595 level.

EES had a favorite group of pairs EUR/USD, EUR/CHF, USD/CHF. The Swiss Franc used to mean something it meant finance, the old guard. The CHF was backed 40% by physical gold. Now, the SNB will not allow the CHF to appreciate because it would have a negative impact as its safe haven currency status. Whether thats true or not, we have decided to stop trading the CHF. With the volatility in the EUR and USD due to the Greek crisis, the uselessness of trading the CHF is highlighted even more. Trading multiple pairs can have the advantage in a volatile market of hedging in and out of positions by trading more than 1 pair that share the same currency. However, because the EUR/CHF did not move by more than 10 pips in the last 20 hours, including EUR/CHF in any strategy is useless.

There is a trade here, when the EUR/CHF is revalued the move takes time and traders can jump on the trend and ride the movement. A trend following system could be loaded to capture this trend when it happens. Or you could simply look at the chart and see it breaking out of its controlled trading bands.

Elite E Services is an electronic boutique brokerage specializing in currency trading, intelligence, and technology surrounding foreign exchange markets. EES offers FX trading systems for clients and investors, FX consulting, technology and tools for trading, system development, custom programming, and FX solutions for businesses.

That signals business as usual eh catnip!