Market Report for April 20th 2011

by bv on April 19, 2011

Daily morning market report on futures and forex: ES, TF, EURUSD and US (T-Bond Fut.)


- ES like all markets was stunned yesterday by the news of the potential S&P downgrading of the US. It fell like a rock to 1290 (Fib) and should start the day a little groggy hovering relatively directionless in the 1290s. Having said that, there are indications of possible recovery in stages if ES manages to first pass 1297-1301, then 1308. It is essential not to let the bearishness set in on (4H+) time frames, and failure to keep 1297 will result in bearish congestion, testing lows and possibly fall to 1277-1281 (still a low prob at this time).

- TF found support on low/mid 810s, and seems to show more recovery potential or at least a greater chance of holding support, (and should also help ES along). TF has however failed to pass Fib on 821, and may find difficult to extract itself from the current trading range above lows. This bearish congestion should end on the upside, to maybe hover in the above price segment (821-828) at best. One cannot discard a more pessimistic scenario on (4H+) with TF looking for a lower support on 800-803 (low prob).

- EURUSD broke as anticipated, yet fell quicker and faster forcing us to review targets all day ending on 416 (cf Twitter). The Euro is confronted to bearish resilience level on 424, along with a bearish channel on 20p-30p Kase. It may then rise to 428-429 (1H-), yet it is clear the (4H+) bull run is now over, and retracement (profit taking) is in order anyway. We cannot exclude a possibility of seeing the Euro test lows again on higher time frames, depending on behaviour on levels as per above.

- US held pretty well after the morning spike to go congest on mid 121s i.e. (4H) Fib. This “safe haven” may be a temporary depository as this recovery should have happened a little at a later stage. US should indeed lose a bit of steam while ensuring higher lows in low/mid 120s. (D/W) remain in bullish congestion mode with little chance of passing current resistance area (mid/high 121s) at this stage.


( Posted 7:45 AM UK )

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