Good day Koalas!
How are you this Tuesday?
Yesterday saw the Shikansen north derailed due to Greece woes. Investors fear that Germany won’t release Greek aid funds until Greece displays a satisfactory plan to cut the budget deficit. Furthermore, a commitment to take tough measures on budget spending was expected. Greece’s citizens are already unhappy that they are bearing the consequences of a financial policy gone wrong. Strikes are happening and more may be on the way if more budget cuts are done in the sensitive areas.
Over in the US, a good home sales figure may be temporary as buyers may be rushing to enjoy a tax credit.
The EUR/USD bounced off the strong line of 1.3285. I LOVE IT WHEN MY CHART WORKS!
Oil is hovering these days and is now at $86+.
Gold is currently trading at $1161+. This is despite a strengthening US Dollar. We may be looking at risk aversion here. Gold is probably an investment of choice when it comes to stormy economic outlook.
Over in the Euro Zone. trouble is brewing. A report stated that credit-default swaps on European sovereign debt went up to records levels on concerns that Greece’s deficit woes is starting to affect the borrowing ability of nations in a similar plight throughout the region. Portugal and Spain may be at risk of being affected. This suggests a possible worst case scenario of a mass crisis of the Euro Zone and hence risk aversion is strong. Germany’s reluctance to participate in the aid solution probably gave the market much to worry about.
In contrast, the American economy seems to be the star of 2010. A report released indicates that confidence among US consumers increased in April to the highest level since Sep 08 as Americans became more optimistic about the employment market. Having said so, do remember that the unemployment rate remains high and investors are probably too distracted with the Euro Zone for now to find any dissatisfaction with the US economy.
Tomorrow is rather light in the data department. You can find the list of the various economic releases in the Economic Calender below.
Bullish momentum may see 1.3360/400.
Further bearish attempt to break 1.3285 if succeeded may bring us to 1.3200 next.
I am having relationship problems with Ms Sleep again. I spent only 5 hours with her yesterday and of most of last week. She says that i do not love her and i have fallen in love with my site and articles instead.
Trade safely and don’t let the kangaroos bite !!!!