Euro maintains bullish momentum following FOMC

Daily Market Analysis (SHORT TERM) Thursday 12/13/2012


KEY TERMS

OVB       Outside Vertical Bar
VRCB    Volatility Reduced Compression Bar

CURRENCIES

Euro FX (December):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 12/11/12 @ 1.2975. Confirmation of a bottom with a close violation on 12/11/12 @ 1.3004. Upside Targets = 1.3183 – 1.3245.
  • New highs made on current move Wednesday @ 1.3099.
  • The December Euro FX carried on its bullish momentum on Wednesday thanks to comments by Fed Chairman Bernanke signaling they will keep the fed funds rates low until most likely mid-2015 and institute additional easing following Operation Twist that pushed the USD lower for most FX markets.
  • The Euro may see a bit of an early drop as its ST rate of change and price action are signaling overbought indicators before resuming its rally early next week to push through to new highs since early May of this year.
  • Projected Daily Range: .0084
  • Projected Weekly Range: .0219
  • Projected Monthly Range: .0456

METALS

COMEX Gold (February ‘13):

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 12/12/12 @ 1718.90. Confirmation of a top with a close violation on 11/28/12 @ 1718.80. Downside Target = 1707.20 – 1694.70
  • February Gold traded just a single tick through last week’s high on Wednesday following the announcement of an extension of the low fed funds rate and additional MBS purchases as Operation Twist winds down.
  • Gold was unable to sustain the early momentum heading into the close of the day as it last traded back below the daily-mid-range, setting up for a possible failure on Thursday if the market trades below $1706.
  • Projected Daily Range: 14.90
  • Projected Weekly Range: 43.10
  • Projected Monthly Range: 94.70

 

INDEXES

E-Mini S&P (December)

  • Short Term Trends are bullish.
  • Confirmation of a bottom with a range violation on 12/07/12 @ 1415.00. Confirmation of a bottom with a close violation on 11/20/12 @ 1386.25. Upside Targets = 1404.00 – 1420.00.
  • New highs made on current move Wednesday @ 1438.75.
  • The December S&Ps moved higher in early trading on Wednesday to new eight-week highs on comments from the FOMC announcing they will tie interest rates to unemployment and purchase additional MBS before falling to new lows on the session going into the close as all eyes returned to pessimistic comments regarding the fiscal cliff.
  • The fiscal cliff continues to be the thorn in the side for many investors trying to manage risk and although the market has seen a nearly 100 point rally in the S&P over the past month, if politicians in Washington are unable to strike a deal in the next seven business days, the market will begin to shed its gains rapidly going into the new year and possibly break the November lows.
  • Projected Daily Range: 14.25
  • Projected Weekly Range: 37.00
  • Projected Monthly Range: 81.50

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