Tuesday, July 20, 2010

Currencies at a Glance

Returning to the typical 2 day bar sort of the Currencies we note the yen is actually holding up better than its counterparts while the dollar exhibits the lowest MoneyStream value, initially suggesting more weakness to come although the technicals are arguing for a consolidation and/or bottoming formation.
The big volume movers were the yen, Aussie dollar and the euro. Largest short interest ratio now resides with TLT, closely followed by the euro.
Of some note: XLE is riding a downtrend with the next intermediate support level around $50, some $2 below current levels. In similar manner GLD is drifting in a downtrend with intermediate support around $110, over $5 below it's current level.
Monday's action on the majors was clearly mixed with the financials, especially BAC, still showing pervasive weakness. The low volume creep Monday felt a lot like the earlier low volume melt up that preceded Friday's plunge and, while earnings reports continue to drive short term momentum, sell side programs continue to overshadow intraday dynamics.

1 comment:

Daniel said...

"..Maybe picking up some SDS or SH to at least get neutral until the danger has passed and we get back to an uptrend...."

Probably sound advice, BZB, since I have some longterm Mutual Fund holdings w redemption fees and sells per year limitations.

Any sense of whether this UP move will carry past the 50dma and back up to the 200 day, as the prior almost did?

I was a little piggy who stubbornly insisted on a tag of the 200sma before shorting, and missed out, as the SPX kept hovering just below that target for several days. I dont want to be frustrated like that again; however, Rydex Bull Bear ratios are currently so pathetically and persistently pessimistic it’s hard to imagine the 200ma NOT being tagged on this go round.

Any thoughts? You always have a good analytical slant on targeting.

Thanks always for sharing your outlooks and methods.

Daniel