FX Futures: World Markets Are Mixed Again This Morning
Richard Rhodes | Sep 04, 2013 09:55AM ET
The world economy is muddling through: the US payroll tax increase and “sequestration” are headwinds to the US economy; China is being pressured by Japan, and both the US and Chinese housing markets are weakening. The Eurozone remains mired in inaction, athough it is showing signs of growth. Quite clearly, we feel risk is being mispriced at current levels given the economic backdrop and developing pressure upon corporate revenues/margins/earnings. At some point, the market will view the central banks will be non-sequitur.
STRATEGY: The S&P 500 remains above the 160-wma long-term support level at 1363; and the standard 200-dma support level at 1562. But perhaps more importantly, the distance above the 160-wma “falied” at the +23- to +25% zone that is our “bubble-like rally” threshold. Hence, a correction of some proportion is forthcoming — perhaps -15% or more.
WORLD MARKETS ARE MIXED AGAIN THIS MORNING as the overwhelming consensus continues to blame the Syrian issue for the volatility seen on a daily basis in the equity markets. Overnight, we’ve seen the US Senate Foreign Relations Committee reach a “draft agreement” authorizing the use of military force. The US House is said to have a very similar agreement, but the scope of engagement is said to be less than that of the Senate. We should expect a vote either today or tomorrow in favor of force, and it should be in place before Mr. Obama travels to Sweden before he attends the G-20 meeting in St. Petersburg…hosted by Mr. Putin – a Syrian ally to be sure.
To Read the Entire Report Please Click on the pdf File Below.
Get The News You Want
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.