2012 Latest Figures

ISM still under 50 points?

The first data of 2013 will be very interesting in order to understand how the U.S. economy will enter the new year. There will be many data starting from today till January 6th and EurUsd could confirm the important bullish break of 1.317 that is setting now an ambitious bullish target for the cross.

The first data will be concerning the houses prices planned for December 26th, followed by December 27th the homes sale and the consumer confidence, and, at the end of 2012 the Chicago PMI on December 28th. But the most expected date on the macroeconomic front will be January 2nd; in fact on that date we will be able to realize what the direction of the ISM manufacturing (that fell below 50 in December) is.

How the German Locomotive is Closing 2012

In Europe, the most important data to be followed will be most of all the German ones. On December 30th the retail sales, on January 2nd the PMI manufacturing and on January 3rd the unemployment rate.

Bank of Japan, New Year And New QE

Japan is desperately trying to devalue the yen to survive a deadly mix of debt and insurmountable trade deficit added to a deflation and recession scenery. On December 28th we will be able to understand where the economy is going, together with unemployment, industrial production, retail sales and inflation. Meanwhile, the Bank of Japan has confirmed the expectations that let the yen depreciate considerably. The buyback of financial assets will increase by 10% breaking the barrier of 100 trillion yen; then the inflation target will be set. The UsdJpy negative reaction is quite interesting, and, in case it will close the year below 83.35 then the bullish break up signal of last week should have to be considered as “false”.

BRIC

Little to report in the emerging countries.
China will release the HSBC manufacturing PMI on December 31st while the services one will be released on January 4th.

Gold: a great opportunity to buy?

The downward trend of gold has begun after the Fed's FOMC. The market has not appreciated the fixed target of inflation and unemployment, and now there is a chance to put a time limit to the Fed's quantitative measures. The bullish break of the resistance has happened exactly at 1.660 and now we are back to the same point. From the technical point of view the 200-days moving average has increased from 1.660, but most of all the oscillators are converging towards an interesting combination. When the 13 days RSI falls below 30 and the 100 days Roc is negative, then the result is the one expressed by the green icons or an assured rebound.

What is really missing is a Rsi under 30 (we're 31), but we're really close to it and so the best thing is to add a long to the existing position at 1.700$. Just to confirm our view, we can also quote the current behavior of gold, very similar to the one that preceded the increase in the debt ceiling in 2011.

Trade: add long XAUUSD at 1650

Trade: Long XAUUSD

Gold in 2012 and 2011

Turkey: Rates Cut, But What About the Inflation?

A cut of the rates by the Turkish central bank from 5.75% to 5.50% was taken for granted, but since this decision has come at the same time of a very bad data on the unemployment ( which has risen to 9.1%), it has weakened the Turkish Lira. Technically, a bullish head and shoulder has been formalized and this certifies the end of the bearish trend 2.28-2.18. The bottom has been hit precisely (as always happened in the last 10 years) when the 30 weeks Roc had fallen below -10% and we have just got back in a positive territory. If history will repeat itself once again, then EURTRY will not reach a top until the Roc will not rise above 20%. The inflation data in early 2013 (January 3rd) could provide further upward pressure bringing EURTRY close to 2.41. For this reason we decide to enter long.

Trade: long EURTRY at 2.36 stop 2.30

Trade long EURTRY

Last Week Comment

The profit on the long position opened on EurAud was very good and generated by the expected strong resistance that AudUsd should have found in area 1.0580. Instead, the long trade on EurSek has closed in balance after an initial lengthening above 8.70, and then has retraced downward as a result of the decision to cut rates by 25 basis points by the central bank. The positions on the purchasing of JPY (short UsdJpy and short NzdJpy) have to be kept opened relying on the technical excesses of the overbought achieved by the cross.