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Grexit

Ridiculous rally until the Brexit vote and FED rate hike in June"Apple" is still leading the market. The "Apple" stock has double bottomed (in a ugly way) and the rest of the market is now following higher. Oil might continue the rally higher beyond 50 "US Dollar" and China might have also double bottomed. If all of this becomes true the market has gotten rid of all negative trends which so far lowered equities. If the squeeze which dragged down stocks for over a year breaks out to the upside a lot of investors might get caught on the wrong side. Therefore the move would be very big. Target: 2300 points or higher. Stop loss: 2025 points This might not happen at such a fast pace to such a high level, but it's possible with the majority of the marketing being bearish (as I also was until today). The deadline for applying for a postal vote at the Brexit referendum in Great Britain is Wednesday 8 June 2016 : www.bbc.com Next FOMC meeting is June 14-15 2016 . The Brexit referendum is being held on Thursday, 23 June .
FX:SPX500Long
by ChartArt
3
Are Brexit fears oversold?Obviously, being smart, sane, savvy and logical traders, we all recognise that there is a monstrous Godzilla formation looming over cable right now. I don't mean some obscure Japanese candlestick formation, but the actual Godzilla, poised to run rampant and squash the UK into smithereens if it votes leave in June. I would contend that the opposite may be the case. When the ever entertaining Boris Johnson came out as pro Brexit, there was a mini tumble in cable. Journalists perhaps not that au fait with markets warned that our friend Godzilla was stretching and limbering up for action. Really, it wasn't such a big deal. The fact is that Boris was expected by many to support the Government line. His declaration was seen by many as a politically motivated direct challenge to Cameron, and call to arms in the race to replace him. New Labour were able to rule untroubled by the Tories for so long due to the Tories poisonous split over Europe. Over time, Cameron has managed to unite the party, but as the vote runs nearer, its becoming more apparent that the party could get torn apart once again. Boris' decision was the equivalent of setting fire to a bridge, and undermining the Prime Minister very publicly. As seen with Blair and Brown, handovers can be troublesome affairs and breed instability and uncertainty over policy which genuinely unsettle markets. The fact that we all need to remember is that markets price information in. People will be watching polls, betting markets, political declarations, corporate decision making and the like for inklings into how the vote will go. Investors and traders will respond to this data long in advance and prepare themselves accordingly. There will not be a situation where a vote is made and then at 4am when the results are announced, the world jumps up and sells cable. There may be a short term dip lower, but I suspect that this is an opportunity to get long. Chart wise, as you can see here from the weekly GBP/USD chart, there is a multi year down trend which at present is running in tandem with the 50W SMA lower. RSE looks uninspiring and set to drift along in the lower half of the range. Slow stochastics have shown an interesting bit of widening which are worth watching. It could be an indication of a push higher if continued, but equally a further cross is an indication of continuation. The obvious thought is that there is tough resistance ahead and all the fundamental focus is on downside risks. However, as mentioned in my other post, Grexit is a very real possibility this summer , and the issue could overshadow the entire Brexit scenario. Throughout the ever lasting eurozone debt crisis, the UK and sterling has offered investors a bit of safe haven effect. Should the UK look likely vote to leave we could see a dip to lows around 1.38 (approx), the long term low where I can imagine a boat load of orders sit, before investors pile in on the bid as the Greek situation causes systemic financial instability.... again.
Long
by GFunk1
EUR/USD in ever tightening range ahead of Greece Mark IIIThere may be trouble ahead... Grexit is hiding in the shadows behind Brexit, but former Greek FinMin believes Grexit in 2016 is more likely than last July . Greece has a colossal amount of ECB debt obligations to meet in July. Negotiations and general turbulence look set to hit its peak in the month before, just as the Brexit vote is taking place. But while theres moonlight and music, and love and romance... Since 2015, EUR/USD has been rangebound between 1.05 and 1.16 (approx). Spot is trading close to the top of the range, and looks supported due to upward trend channel, and RSI trend higher and the 50W SMA sat snuggly below. A flattening of the 50 & 200W SMAs, and extended ranging in oversold territory of the slow stochastic, indicates a continuation of the status quo. Bare in mind that this is a weekly chart and there are still several hundred pips of juicy range to play within for now. Lets face the music and dance... In the longer term, I'd imagine that there are still some people who have been short EUR/USD from a long way down. With Leave in the Brexit vote creeping into the lead, and the vote maybe influenced by the UK publics reactions to the handling of the Greek situation and any migrant/terrorist related chaos, it wouldn't surprise me if some people were taking money off the table, and readjusting positions ahead of June (Brexit vote) and July (Greek crisis), with a view to get short for a fresh push for parity again.
by GFunk1
Why isn't the Euro weaker?It could be said that it is slightly strange that the Euro isn't weaker. As of writing, EURUSD is trading at 1.1040 after seeing lows of 1.0458 back in February 2015. From March last year until February this year, EURUSD was in a very steep downtrend with a range of ~3500 pips. Since then, the pair has remained relatively stagnant, after seeing a bounce off of the 1.0460 level. With the Greek situation weighing and another round of Quantitative Easing, you probably would have thought that the Euro would have been much weaker. However that is not the case, evidently. We have 3 fundamental beliefs with regards to this. 1) The market has been poised for a US rate hike for a while. However, to justify a rate hike, consistently strong data has to be printed, but the US has not been able to achieve this as of yet. Combined with this, short term rate differentials would in fact suggest that EURUSD should be above current levels, as well as inflation expectations. These correlations are slightly weak, however. 2) Uncertainty in Greece is causing indecisiveness. Investors do not actually know how Greece will leave the Eurozone, as it has never been done before and there is no real procedure for a country to leave. On the flip side, Tsipras has suggested an extra EUR 60bn to be provided to Greece for the next 3 years. This seems like it would not solve the underlying problem and merely extend the time it takes to pay their creditors. Investors are aware of this. This uncertainty could be causing the lack of Euro weakness. If and when a deal is reached, a rally and fade could most probably occur (i.e a spike in price and then a fall). A good quote for why this situation is taking so long to resolve: 'if you owe the bank £500 it's your problem; if you owe the bank £5m it's their problem.' 3) Many people believed that the Eurozone would be like Japan in terms of reintroducing QE (deflation and QE for a long period of time). However, investors began unwinding short positions when they saw that Eurozone data was actually improving post-QE introduction. This lead to an increase in the price of the Euro which is still having an effect today. Please add comments. If you agree or disagree, I'd really like to hear it. www.admiralmarkets.com Follow us on Twitter: @AdmiralMarkets
by DavidBelleFX
10
Dollar Data Dependant The USD sell off as traders set a chain of profit taking after 2 weeks rally due to various factors: - Greece uncertainty of exiting the EZ make holding USD worthwhile - US Economic data has been promising with CPI much higher - Hawkish comment from Yellen - That view is changing with 5th of June looming for a potential deal and no Grexit A lower USD potentially because: - Euro rally with Bund unable to find support and Grexit averted - Unwinding of USD/JPY longs - Commodities currencies caught bids - A worse than expected US economic data A higher USD potentially because: - Grexit so USD safe haven currency - Better than expected US economic data that imply a September rate hike - Hawkish comment from Fed members Technically: - Heavy band of resistance between 96.63 and 97.73 - Heavily biased for more downside with a possible AB - CD playing out
INDEX:DXY
by sugardaddyFED