02 února 2010

Ken Veksler's Market Commentary

Good morning,

I was out sick yesterday and thus no comment.
I walk in this morning however full of jubilation (much like many other Australian mortgage holders) having witnessed the RBA take a break from their hiking cycle. This proved to be much to the surprise of the broader market, however, once again playing contrarian has proved (for me at least) profitable. The rhetoric that Governor Stephens delivered was surprisingly upbeat and thus created much doubt in the mind of punters out there. But he did touch on an important factor that will hold further Australian economic growth in the palm of its hand, and that of course is China. Mentioning what I have been screaming about for months now, and that is that not everything might be as rosy as we are led to believe over there. The recent macro shakeup that came in the form of seemingly tightening credit lines in China was enough to spook the RBA to hold off for now. Interestingly I’m inclined to believe that they will do likewise come the next meeting in March, again with mention of the local Australian banks having gone that extra mile on raising rates that has allowed the RBA to sit on the sidelines for the time being.

Unsurprisingly the AUDUSD tanked losing over 1.1% overnight and took an equally big hit on the AUDJPY taking it to multi month lows.

Elsewhere the overnight session seemed fairly quiet for the most part with the only movement of note being in Asian equities which also took a fairly large nosedive lower.

On the day, the data front presents us with little to work with so markets should be fairly tame. I remain short of the GBPCHF and now fresh shorts established in the USDCAD. On both I look for decisive breaks lower to unfold in the coming days and feel that the USDCAD, while it may rally at least once more presents more opportunities to fade the move looking for a return into 1.0500 and lower.

The EURUSD is still looking heavy and the key pivot now reverts lower into 1.4030/80, with a daily close above signaling short term retracements higher. However, conversely the ability to maintain daily closes below this level allow for further tests of purported barriers at 1.3850 and lower into key support at 1.3750.
On the Cable, while liking it lower the risk is now firmly on the day for a squeeze and cleanout higher. Look for 1.5980/1.6030 to hold the topside and offer fresh intraday selling opportunities.

That should cover it for today, while I take stock and have a closer look at the market in a week which is data heavy in the tail end.

Best regards,

Ken Veksler.

0 komentářů: