The ECB now has to either become the
lender of last resort that Europe so des-perately needs (and trample over Ger-many’s sensitivities in the process), or the
Euro must fall. There is no other choice.
ANALYST COMMENTS: [ ALL BEARISH ]
Debt mountains and austerity policies will send EU into a recession,
especially if slow Euro-zone growth, pessimism and risk aversion continue to weigh on the single currency.
More signs of recovery in the US, along with Europe one step closer to recession, will keep the downward pressure intact in the pair. Next Friday, US NFP will set the trend: a positive number may trigger short term risk appetite favoring the EUR. In the long run however, will set the bases for more dollar gains.
After indirect QE didn't calm the bond markets, the euro eventually fell. The ECB will be pushed to launch QE. In any case, it's a lose lose situation for the euro - a recession in the euro zone and growing debt all point to one direction: lower.
FULL STORY OF EURO 2011
FOREX WEEK AHEAD: Focus On French Bond Auctions ...If the auctions result in higher-than-expected yields or less debt sold than expected, it will indicate investors are wary of buying debt even from core European countries - YIELD HIGHER TO PUSH DEMAND HIGHER BECAUSE DEMAND IS LOW! SENDING THE EURO DOWN. IF YIELD IS LOW THAT MEANS BONDS ARE DOING GOOD, AND PEOPLE ARE CONFIDENT, EURO GOES UP.
BONDS EXPLAINED *DONE READ*
GREECE DEFAULT EXPLAINED *NOT DONE*
Posted by Edgar Ng at 4:32 AM
“Successful trading is always
an emotional battle for the speculator, not an intelligent battle.”
“…it’s an aptitude for the game, a stomach for the ride, and the ability to see what
is happening without emotion.
Posted by Edgar Ng at 11:18 AM