EurOpeaN FirewaLL iS NexT after GreecE BaiLOuT !
Greece may have overcome another major milestone by successfully ending up with the debt swap deal with its private creditors that will help them to reduce their debt burden that allows Greece to receive 2nd official bailout package. For Private Investors (PSI) the value of old bond has been reduced to 53.5 pct, which they will swap with new bond. The result announcement is expected today at 0600 GMT.
Initially the conclusion of this deal will give further boost to the European financial market, but market will soon start talking of IMF demand for placing European firewall i.e., EURO 500 billion European Stability Mechanism (ESM) to obtain fresh funding.
In another development ECB Chief Mario Draghi said that they did not discuss lowering of interest rate or another LTRO, but lowers European growth prospects and hikes inflation number due to higher oil price, which is understandable. So for now no one will talk on these two subjects.
Overall, this could be positive development, as we can see small shift in market sentiment, but there are many more hurdles to come, so time will tell us that if this is sustainable for sometime or will be short lived. But I will remain cautious and will be watching every move carefully.
GOLD $ 1705 = Gold is likely to continue its upward journey. During Asian session Gold should find top around $ 1712-15. I prefer to wait buy on dips around $ 1698-00 zones, as next resistance level is $ 1728. Support level of $ 1688-90 should not surrender for continuation of up move
EURO @ 1.3263 = Buying of Euro is preferred around 1.3245-50 with STOPS 1.3210. Break of 1.3295 will encourage for 1.3325. However, EURO needs to clear 1.3380. Failing to break could lead to another correction.
GBP @ 1.5818 = Buying of cable is preferred around 1.5790’s zone, with STOP LOSS if 1.5760 surrenders. A break 1.5845 is required for a test of 1.5870-75 levels.
March 08- GoLD BottomeD OuT– EurO & GbP BiaS UpwarD
http://www.forexstreet.net/profiles/blogs/gold-bottomed-out-euro-gb...
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Comment by Gordon Gekko on March 9, 2012 at 6:17am -
CACS were triggered. Just announced. I am negative in GOld and Euro from the release of the news. Should I stay in there or close my positions?
Thanks,
BR,
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Comment by asad rizvi on March 9, 2012 at 6:27am
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Well I am sure of your position. My recomendation was to buy on dips aroudn $ 1698-00. Not befor that
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Comment by Gordon Gekko on March 9, 2012 at 6:30am
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Dear Mr. Rizvi,
I bought Gold on 1704 (higher than suggested) and Euro on 1.3250. Where should my SL on Gold be?
Secondly, do you think that triggered of the CACS will bring down the Euro and the Gold with it even if the debt swap was completed?
Thanks.
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I do not see any negative at the moment we are going through small correction. You will get opportunity to get rid of your position without loosing. Euro needs for move above 1.3245 for more gains if fails could test 1.3210. Any ways if you are uncomfortable suggest square now with tiny loss.
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Comment by Gordon Gekko on March 9, 2012 at 7:21am
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I got out of Gold break even and Euro also, lost only on Silver but very light loss. I think I want to stay away today as the Greek issue still has to resolve the CDS at 1:00 pm GMT.
BR,
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Good strategy when market is unclear. Now the market is waiting to hear if CDS is going to trigger, which means loss. I think this may may 5-6 hours, so I think until then market will reamin nervous and directionless....GL
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Comment by Gordon Gekko on March 9, 2012 at 7:34am
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Exactly Mr. Rizvi, markets are very very nervous and the Euro and stock markets are either falling or flat (Europe) ahead of the opening. Unchartered territory (credit event). As such, having tight SLs or exiting break even when u feel the market is jittery is the best strategy and also entering with 1 lot per trade is also conservative (depending on account size ofcourse).
I will remain off the market till your Monday's morning blog post as today looks to be nerve wracking, I will cash in my profits of the week and be gone.
In the meantime, I wish you and every reader a nice week-end :-)
BR,
Ziad
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EURO @ 1.3214 = Hope my timely response to a trader to square Euro & Gold short positions may have been beneficial. Well the current dip is likely to break 1.3210 and could extend up to up 1.3170-80levels.
Now market is waiting for CDS announcement. We may see that CDS trigger by small amount and that will be time for EURO bottom hunting, as market is expected to quickly bounce back after the announcement. The levels to watch will be 1.3120 and 1.3050 should hold for 150-200 pip gain....More Later
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Comment by naivetrader1 on March 9, 2012 at 10:38am -
Better numbers in JAN & Feb NFP, pushed USD down & lifted EU. Do u think it might repeat the same, this afternoon? It might help EU to go up 3380-3400 & fall.....?
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Comment by naivetrader1 on March 9, 2012 at 10:40am
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I know that U don't look @ Technicals; but there is a Bearish Engulfing Pattern, on Weekly Chart & only a break above 3485would cancel it .....
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