Key Highlights till now:
- Greece fails to form a stable governing coalition over the weekend. Markets await any commentary from party heads as they are set to meet at 1730BST.
- The PBOC have cut their RRR to 20% from 20.5% for large financial institutions in an effort to inject CNY 400bln into the national economy.
- German Chancellor Merkel’s CDU party is defeated in regional parliamentary elections by the SPD.
- Flight to quality observed across the markets, with equities seen sharply lower and fixed income securities making gains throughout the session as risk-aversion is the theme of the day so far.
Both Spain and Italy have managed to sell to the top of the indicative range in their respective auctions, however both countries saw an increase in borrowing costs, with the Italian yield hitting its highest level since January in their only on-the-run line. (Sources)
German chancellor Merkel‟s centre-right CDU suffered a bruising defeat on Sunday night in the election of a new parliament in North Rhine-Westphalia. (FT-More) According to the predictions from the ARD, results show the SPD got 39%, the CDU plunged to 26% and the Greens remain stable at 12%. (at the last NRW elections: SPD: 34.6%, CDU: 34.5%, Greens: 12.1%). (Die Welt)
The German finance minister said that Greece would receive a further aid program from the EFSF if it exited the Euro. He added that he remains confident that the fiscal pact will be approved in the German parliament before the summer break. (Spiegel/Welt am Sonntag).
A few Charts and setups before we round it off with charts from our staple indicators Falconfx and Gladiator. If you have still not got into the exclusive club, you can do so here before we raise prices for these super indicators. Indicator Membership.
Gold charts
The weekly has its 100 WMA coming in at 1525. This is the first time in 24 months that we have gold prices coming in striking distance of this level. To be fair, if this price goes on the week closing, Gold uptrend is done and dusted for some time to come.
The Gold hourly charts has some retrace value to 1587 which is the 100 ma which has capped any form of rally. This can be shorted non stop till the time we get bored off it.
The Oil weekly looks bearish with strIking distance of 100 WMa.
The Oil hourly looks even more bearish as it pierces 95.5 which was key to supporting any retrace back to 98 levels. Now we are targeting 90.5 levels but as usual your stops have to be above the previous breakdown level at 95.5.
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Finally, charts and setups from Falconfx and Gladiator
Thats it from me now.
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Thanks
Mark
