Market Morning

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Greece is the word, not the bird (which is what they should be giving to the bondholders). We had a reversal in risk markets overnight, as the Pyrrhic debt deal takes hold. You’ll have to wait until Delusional Economics does his epic reporting, because I’m as confused as you to what’s really going on!

Lets check out what happened in detail before the open of the local markets – remember to read my weekly update to always put this daily noise in context:

The UK FTSE and the German DAX, were both up – the former just over 1%, the latter over 2.4%, I guess on news that its uncaptialised banks have escaped slaughter yet again. The two major European bourses have not yet broken resistance barriers set by this liquidity led (LTRO) equity rally, at 5950 and 6950 points respectively, but they are now getting close again.

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The Euro (EUR/USD) jumped above 1.32 against the USD gaining almost 1%, building above support at 1.31:

The USD Index has slipped below 80 points on the risk-on move, with support below at 78 points, the Loonie and Yen also gaining against the reserve currency. As Deus Forex Machina pointed out this morning, the AUD is acting like a rising boat, now well above 1.06 against the USD, at 1.065 this morning.

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The US markets rallied, but only half (around 1% across the board), with the S&P500 up 13 points to around 1365 points, it’s still looking “toppy” to me:

On to the arguably more important debt markets, the US 10 year T-Notes yields up to 2.01%, German bonds (bunds) falling slightly, with yields up marginally to 1.8% and Aussie 10 year bonds yields up to 3.99%, with the yield curve still inverted.

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To commodities: the metals had another good night (palladium raced ahead), whilst energies remained flat with WTI crude finishing just above $106 a barrel, and Brent crude just above $122USD on the spot markets – both still at high levels:

Gold rallied and crossed over the $1700USD barrier again, but settled down to $1699USD an ounce where it remains on the open of the Asian session.

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The S&P/ASX200 index futures point to a higher open, up 20 points to just under 4200 points on these good leads.

My Trading Day post will cover the Asian market session and the “ASX8” stocks after the close in the afternoon.

www.twitter.com/ThePrinceMB

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