Reviewing Game Setting for Fr 12/02/2011
I expect some kind of continuous rally based on hopes before the Dec 8 ECB, Dec 9 Euro summit and Dec 13 FOMC. For my short term trading purpose my first care are the support 123.00 and the resistance zone 126.70-128.40.
Bulls: in action with first targets 126.70-128.40.
=> Bought 125.80 sold 126.30 made +0.50.
Bears: may have enough time to enjoy the short term hibernation.
=> No, Bears want to fight!
Accumulated Score from 11/23/2011: 1.80 + 0.50 = 2.30
11:05 AM update
Bulls may take a break next Monday. >> Wait and see.
1. SPY talk: The selling pressure came @126.50 at 10:25 a bit early before my resistance low target @126.70. The price then just dropped and dropped further without any bounce. That can be translated as most of Bulls might want to take profit and very few Bulls left to believe a next green day.
The bearish scenario we may see 123.80 and 123.18 be tested.
The bullish scenario we may see 126.50 be retested.
2. Bullish supports:
- US Non-farm Payrolls improvement and Unemployment reduced to 8.6% from 9.0%.
- Some kind of hopes before the Dec 8 ECB, Dec 9 Euro summit and Dec 13 FOMC.
- Technically there must be some more room ahead for bulls to advance because overbought conditions are not seen yet.
3. Bearrish supports:
- Euro zone leaders have spent too long time seeking for a viable solution for the debt crisis and there remain uncertainties about how the crisis can be solved. That is eroding the confidence of the markets participants in the context of Euro zone showing signs of a recession.
- Investors and lenders want a quick fix of the debt crisis. They want to see sustainable debt costs so that their money can be back from sovereign debt with minimal loss. By the common concepts at the moment, that can only be achieved with some kind of bailout or Eurobonds or ECB as a lender of last resort.
- Merkel, the decisive voice of the powerhouse, doesn’t want bailouts, neither Eurobonds nor ECB as last resort lender but thinks that Euro zone can win back the market confidence by applying the austerity and reform on the trouble debtors incorporated with altering Europe's treaties in real fiscal discipline.
- If a compromise solution can not find in coming days, debt costs may spike up again, and markets may sink as a way to continuously pricing in the foretold insolvency.
10:50-11:10PM Update:
A good sign from Italy (TheGuardian).
Italian cabinet was meeting on Sunday to approve austerity measures aimed at restoring it’s credibility in the market.
Their emergency budget, worth a reported €24bn, is hoping to rush the measures through parliament before the EU summit begins on Thursday.
The cabinet was apparently considering:
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a rise in income tax for high earners,
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an increase in VAT of up to two percentage points,
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the restoration of property tax on first homes and new levies on yachts, helicopters and other luxury assets.
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plans to push back the retirement age, and
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to ban cash payments above €1,000 as a contribution to curbing tax evasion.
Asia Markets are showing some slightly positive signs.
EURUSD +0.21% is showing a slightly green.
4:00AM Update:
Europe markets are all in mildly green.
EURUSD +0.25%
4. My Game Setting for Monday 12/05/2011
Asia and Europe markets are welcoming the Italian austerity plan and I expect the same thing may happen to US markets today. However some caution may need before the press conference of Sarkozy and Merkel meeting in Paris today.
I tend to favor Bulls 60% against Bears 40% for this week.
Bulls: Long on the way up to test 126.50 - 126.70 -1 28.40
Bears: Short on the way down to test 123.80 - 123.18
11:03 Update
SPY seems behaving some pull back. Any way, I already closed all my longs and have to go to bed. I favor Bulls however some caution may need before the press conference of Sarkozy and Merkel meeting in Paris today.
My activities today:
