Intraday Market Thoughts Archives

THIS ARTICLE MAY BE IN SPANISH but the Euro & Gold Charts in here are STRAIGHTFORWARD http://bit.ly/eUHSXP

WHAT HAPPENNED TO GOLD's SAFE HAVEN STATUS ? Golds inability to extend gains during the Korean geopolical tensions emerges from the rising cost of USD LIBOR, and lingering fears of additional rate hikes from China. One of the main differences between today and Feb-May (during Greek sovereign crisis) is that the role of the Chinese tightening stands in the way of any prolonged gold buying. Chinese tightening poses a negative for the risk trade via the potential of hampering demand for commodities. In contrast, last Springs Greece crisis was a green light to buy gold vs. EUR and USD. At the time, Chinas tightening was limited to timid hikes in banks reserve requirement ratios. Today, however, with CPI jumping to 4.4% annually presents more urgency to raise interest rates, which is an obstacle for base and precious metals. The Oct 19 rate hike was the first increase since Dec 2007. Two more rate hikes of at least 27 bps are expected in Q1 2011. HERE's GOLD CHART http://chart.ly/klm2h7l Same idea that was TALKED ABOUT IN this article:

http://www.ashraflaidi.com/articles/eurgbp-gold-aussie.asp

AUDUSD FALLS IN SUBMISSION TO THE Head & Shoulder first mentioned on Tuesday. http://bit.ly/h9cRJ7 0.9620 and 0.9550s are the next key targets, If ( I said IF) the PBOC does raise rates today (any rate hike would be announced around 10:30 am GMT), Aussie would be among the big victims as was the case on Oct 19. But even if there's no China rate hike, Aussie technicals are going from bad to worse in the daily and weekly chart http://bit.ly/h9cRJ7 And the KOREA STORY is certainly not helping. Meanwhile USDCHF breaks further out of parity.

EURUSD IS SET ON A PATH towards the important $1.3250s trendline support (from June low), a break of which will likely call up $1.2700. Ive clearly warned on Wednesdays video for Reuters Thomson about the importance of the 55-WMA http://bit.ly/eW1OT6 and its relevance for USDX. . Using the German-US yield spreads, you will recall the Nov 16 video pointing the DOUBLE TOP in the GE-US spread, whose negative implications added to negative sentiment in EURUSD. http://bit.ly/brrCSP USDCHF FINALLY HITS PARITY. Here is the Video Presentation from Nov 3rd calling for USDCHF parity and beyond when USDCHF stood at 0.9770s using the weekly and monthly charts (after 0:40 mins and 2:05 mins) http://link.reuters.com/xap63q . The weekly chart now remains set on producing 1.0080 and 1.0120. I am producing these Reuters Thomson on a WEEKLY basis for your education and trading benefit and will continue to refer back to them as long as they remain valid. Im at the Borsadiner Expo in Barcelona til end of week. http://bit.ly/hSnQPs

Wishing you a Happy & Safe Thanksgiving

NOW THAT EURCAD HOTCHART has hit the 400-pip target of 1.3570 http://bit.ly/bIepzB is this the end of the road? DO WE GO for shorts in EURCHF, EURGBP, or expect further selling in EURCAD? There is NO QUESTION about EURGBP. The latest article continues to await 0.8320 in EURGBP. As for EURCAD, I am now calling for further declines towards prelim target of 1.3380, followed by 1.3260. EURCHF does look bearish, but since CADCHF has just broken out of the 0.98 resistance to fresh 2-month high, I prefer to use CADs relative strength via EUR shorts. I briefly mentioned NZDCAD yesterday, whose collapse has added to the break of the 0.7760 support (now at 0.7695). Daily NZDCAD may look oversold but WEEKLY suggests further downside towards 0.7570. And finally, I REMAIN BULLISH USDCHF (since Nov 2nd) awaiting 1.02 by mid January.

MORE CHARTING VIDEOS; this time Ashraf contrasting EURUSD & USDX moving averages for Reuters Thomson http://bit.ly/eW1OT6 EURUSD will need to close FRIDAY ABOVE $1.3490s in order for EURUSD upside to be revived.

ASHRAF IN BARCELONA & VIDEO MARKET HIGHLIGHTS

Ashraf speaks tomorrow (Thursday) at at Borsadiner in Barcelona at 18:30 on End of Year Volatility & the outlook for FX, Gold, Oil & Silver.

"Como gestionar, en este final de ao, la volatilidad en los mercados de

divisas y materias primas. Implicaciones de las polticas actuales de los

Bancos Centrales." REGISTER ERE : http://bit.ly/hSnQPs

IN CASE YOU HAVEN't seen the latest Video Highlights http://bit.ly/ 6OIyH

Ashraf's Video Market Highlights ARE BACK. NEW & IMPROVED. This time in FULL HIGH DEFINITION (select HD option when viewing) http://bit.ly/6OIyH Analysing EURUSD 55-week MA & the implications of the break

If you have not seen today's AUDUSD Chart http://chart.ly/4thf8k8 , it is down 98 pips since initially posted on Twitter/alaidi

AUDUSD TEXT BOOK HEAD & SHOULDER http://chart.ly/4thf8k8

extending losses below 0.98, eyeing interim support at 0.9730, followed by 0.9660. With copper prices testing their 55-day MA of 8,180 and risk aversion enforced by Dutch fin min saying bond holders of Irish banks "will have to bleed" in consolidation, the USD-trade becomes all the more positive. The remarks from the Dutch fin minister deflect ATTENTION ONTO BANKING BONDS, leading to the realization that bond holders of Irish banks (not just sovereign) may not be saved by a bailout of the sovereign and could sustain losses from any insufficient program for the depositors. Upward revision in US Q3 GDP data as well as personal consumption expenditure is also serving to revise expectations vis-a-vis QE2. EURGBP extending losses below 0.85 testing the key 61.8% retracement, a break of which eyes 0.839.

US Q3 GDP REVISED UP TO 2.5% from 2.0%, with PCE aleasy revised up to 2.8%. GOOD US DATA IS GOOD FOR USD (as we saw last week) based on QE2 arguments. KOREAN BORDER FIRE, FBI RAIDS of US hedge funds & prolonged Irish uncertainty are are all ideal catalysts for renewed risk-aversion. Despite the late session rebound in US Monday session, markets are back in sell mode. USD & CHF regain the bulk of risk appetite as the YEN is hit across the board by the exchange of fire across the Korean border, resulting into 4 casualties. YEN has always sold off during Korean tensions, now allowing for USD and CHF to flex muscles EUR and commodity currencies. EURCHF eyes 1.3310 trendline support. Watch AUDUSD breaking below 0.98, eyeing 0.9730, 0.9650 later in week.

AUSSIE, KIWI, OR BOTH? S&P's decision to place New Zealand foreign currency on negtaive outlook out of concern with its surging current account deficit running 3% of GDP. NZD already fell 1% against USD to 0.7690, with more downside seen at the Oct high of 0.7640, followed by 0.7570. But rather than simply chasing the Kiwi trade against USD or JPY, consider AUD losses vs. USD. AUDUSD Daily shows a possible Head & Shoulder formation with the failed right shoulder at 0.9958 before pulling back towards 0.9820s. prelim support seen standing at 0.9770, before the 0.9730 coincides with 55-day MA, a tech level which held since August. You must know by know the importance of those 55 MAs (daily & weekly) after the patterns with EURUSD, 10 year yields and USDX.

ASHRAF's ENGLISH & ARABIC VIDEOS; REUTERS THOMSON on using Gold vs Aussie and the implications for Gold vs USD & EUR http://link.reuters.com/xys46q

Ashraf's interview with Arabiya in (in Arabic) about Ireland, euro & comparisons with Greece http://youtu.be/8rcrFXMnpFU

EURUSD drops more than 100 pips as Irish opposition parties say they will vote against the 2011 budget.

EUR off its session highs from the Asian session after Ireland confirmed it would seek an EU/IMF bailout estimated around EUR 80-90 bln. Ireland says tax hikes are not part of the package. A finalisation of the deal is not expected until month end. Even though Irish officials have repeatedly stated they did not need outside help earlier this month, the main purpose for them to accept bailout (regardless of whether it will be activated) has been to appease financial markets. Portugal is also on the radar, raising questions that it could be the 3rd nation to ask for help. EURUSD remains unable to break above $1.3780s, with $1.3820 acting as the 21-day MA. DOWNSIDE BIAS REMAINS. On the downside, support emerges at $1.3620--the 100-week MA, which coincides with the 55-day MA. CAD BROADENS STRENGTH amid the general pick up in risk appetite, USDCAD risks breaking below 1.0100 towards 1.0070, while EURCAD seen adding to losses below 1.39 to 1.3850 with upside capped at 1.3980.