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EU Market Outlook - Is Spain Ready?

Last updated 9/21/2012 1:11 AM EST (GMT -5) 0 Comments - Add your comment

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Andrew Taylor

Market Strategist, GFT

Follow @ATaylor_GFT

Top Headlines

o    Mixed US data has little bearing

o    Spain’s Bond Auction goes well > Market Chatter they are in discussions for bailout

o    UK Public sector Net borrowings pick of a tame bunch of data

Market Moves

o    AUD & EUR rebounds nicely on new found support and short covering

o    AU/Asia equities post nice gains across the board

o    Gold, Silver, Copper show solid rebound and Oil levels

Recent selling pressure in equity markets has managed to find it’s near term support and rally as yesterdays dark PMI cloud drifted from the trader’s memories. Commodities helped keep attitudes positive as short covering helped drag commodity currencies higher.

The recent over hang in Asian Markets surrounding Chinas return to fortunes show that the markets calculations were a little optimistic, as continued sombre data describes an economy that has some work to do yet.

The US released a mixed bag of economic data but had little bearing on proceedings with its Manufacturing PMI printing in line with expectation but remaining solemn. The Philly Fed index surprised although remaining in contraction. Unemployment claims were higher but 8k of claims were accounted for due to adverse conditions - so the number was taken in its stride.

Outlook

Europe today is light on data which will see a continuation of the macro themes and positional game playing we saw in the Asia session. Watch for information that the Spanish government is currently nutting out conditions of a full sovereign bailout. Will the shiny new bond buying machine fire up without a hitch?

Trade Idea

Today’s long AUD/USD trade idea hit both Profit Targets (1.0435 & 1.0475) with only one hitch – the pull back was about 10 pips short for us to get in at the 1.0410 level – Ah well, rationale was right anyway – although I can’t feed the kids on rationale.

Enjoy the weekend!

For more intraday analysis and trade ideas, follow me on twitter @ATaylor_GFT

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The information, including Commentary and Trade Ideas, provided on FX360.com should not be relied upon as a substitute for extensive independent research which should be performed before making your investment decisions. Global Futures & Forex, Ltd. (“GFT Markets”) and FX360.com is merely providing this information for your general information. The information and opinions presented do not take into account any particular individual’s investment objectives, financial situation, or needs. All investors should obtain advice based on their unique situation before making any investment decision and should tailor the trade size and leverage of their trading to their personal risk appetite. Any projections or views of the market provided by FX360.com may not prove to be accurate.

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About The Author

Andrew Taylor's financial markets career started in 1991 in the interbank FX market,where he worked for one of the largest banks in Australia. Andrew then went on to trade on behalf of some of the biggest global banks, working across five of the world's major financial hubs: Sydney, New York, Singapore, Auckland, and Tokyo.

His more than 20 years of experience spans market borders and asset classes, covering global equities, commodities, options and futures. Andrew's wealth of trading experience and ability to communicate with traders of all levels has put him in demand as a first point of contact for clients and the media alike when seeking information and guidance.