Laughing at Labor has become a national pastime, we’ve landed in the Italian zone of politics. Gillard clearly wasn’t liked both domestically and internationally and it seems inside her own party. However, I thought her resignation speech the best delivered by an outgoing PM in years. And unlike the incoming miserable mutt who cried at his, she was stoic and honourable, wish she was like that as PM. It has to be said that the Kevin-expensive-747 only managed 56% of support in his own party. Not exactly a decider, nor a majority. Still, it will be a lively campaign now and if he wins at least then the Liberals will hand the reins over to Mal T, the only statesman in politics at the moment.
Damn you Draghi, keeping the spigot wide open, ruined my Euro setup. Mario last night said that the will maintain the loose stance as long as needed. Bernanke said same thing but the difference is that Ben sees light at the end of the tunnel, whilst it’s a deep dark hole Mario is in. http://www.bloomberg.com/news/2013-06-26/draghi-says-deficit-cuts-in-euro-area-should-be-growth-friendly.html
The US GDP revised figure for the 1st quarter of 2013 came in lower than expected at 1.8%. Quite a bit lower than the 2.4% expected. So growth is not as robust as seen by the Fed. Also, most Fed sitting members have been out this week saying that the Fed will continue their purchase program for long as necessary, trying to dampen the market’s reaction to the possible thought of the tap turning off. So, the markets read the combination as the US is growing but not at a rate to warrant a “tapering” of the Fed’s spending. Up goes stocks, down goes greenbacks. Had enough of the volatility? I have. The result of quantitative easing. Things were so much easier last decade. Back when Johnny ran the show.
DATA HIGHLIGHTS AHEAD (times are in AEST) – 630pm UK Current account. 12am US Pending home sales.
AUDUSD –Made a push through 93¢ as Rudd was announced the winner and QLD flogged NSW, making a higher high. With the US dollar retreating somewhat it looks good for a run back to the ema, but don’t get too excited as we are still glued to the ema on the hourly, its not on fire yet. Next week is RBA again and we are at 23% of a drop in rates.
EURUSD –Despite the US dollar, Draghi’s hand of keeping a lower Euro trumps Ben’s hand. Major support line of €1.30 has held for the time being and as sellers are dominating the proceedings and no setup on the daily, look to lower time frames to participate in Mario’s dream.
GBPUSD –A BOE official came out to weaken the £, saying the recovery is weak and calls for an increase in the asset purchase program. Seems that Mario and UK have seen the benefit of Ben’s spending spree and want to replicate it for their economies and are ramping up their efforts in a bid to crawl out of the hole quicker. A slippery slope indeed. The BOE at the same time as this are ordering a review of banks risk in a rising interest rate environment, its as if they finally can sense the impending disaster we’ve all seen QE to be.
NZDUSD – A nice little swing low in place but no RSI divergence and couldn’t hold above resistance 7815. A weaker trade balance may see the kiwi track sideways for rest of week.
USDCAD –Support level holding the Loonie above my stop but there is clearly more sellers in yesterday’s action than buyers. With a bounce in oil price and weakening greenback it may get through today.
USDJPY – Is stuck at its average, the mean. Trying to decide which way to go. Price not indicating either way so I too will sit on the fence here.
GOLD – Got smoked 56 bucks last night and don’t ask me if I got any of it, I pulled my sell order 20mins before it fell…hmmm. Went straight through 2010 resistance level like a hot knife through butter but stopped right on 2009 high of 1226.