Archived IMT (2010.09.24)

WHEN READING THE WEEKEND PAPERS, YOUD REFLECT ON A WEEK IN WHICH GOLD hit $1300, SILVER finally broke to new record highs $21.40, EURUSD FINALLY closed the WEEK above its 200-day MA for the first time since January, USDCHF hit new ALL TIME LOWS below 0.98 and the US central bank has taken a closer step to another historical round of brand new asset purchases. As a result, the USD INDEX is breaking below the triple bottom of 80, hitting 79.50, which well below the 200-week MA. Short of any tightening from China or political/debt upheaval in Ireland, USDX appears to extend the move towards 78. As a trader, it is sensible to worry about Eurozones debt troubles, but do NOT let it cloud your judgement with stubborn positioning, while ignoring the important technicals unravelling in the market (EURUSD close above 200day) and the better than exp Ezone debt auctions and decent IFO surveys. This already happened in June when the euro bottom and subsequent recovery was triggered by robust Spain auctions and an onslaught of poor US data. Today, the bad US data has been replaced by the Feds dipping its feet into QE2. Shorts in EURCHF and USDCHF are worth exploring, as 0.95 and 1.29 for the medium term. GBPUSD breaks above key retracement level of $1.5740 for a possible $1.5980 next week, but swing traders may find opportunities from 1.5800 to 1.5750.