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» Sat 6:00am EBA Bank Stress Test Results – EUR, USD, JPY

 

The JPY saw a wild trading session today as the BOJ boosts dollar lending and ETF purchases. Interest rates to be kept steady at this point. We found out on Wednesday the amount of the stimulus package.

This weekend we have the EBA stress test results, while today was important this could be critical. News has been emerging of the unserviceable debt the Italian Banks are holding. If we have very bad news emerging from these tests it could put real pressure on the European Union. Some have spoken of a second financial crisis in the EU, lead by the collapse of the Italian banks. I hope we see levels not outside what’s known about currently. If there are very negative results released on Saturday we could see the USD open a lot stronger on Monday.

We had a wild Asian session today on the JPY with the JPN225 and JPY pairs all making strong moves. Today was a classic stay out and watch day. We had strong moves down but the counter rallies were deep. The USDJPY had a 256 pip range. The JPN255 reached 16732 before dropping down to 16025 45 minutes later. Gold fell $9 and recovered back to a high of 1343 all in 30 minutes of trade. The AUD, GBP,and EUR had smoother starts to the day all making ground on the USD. The AUS200 has pared early losses to be trading positively at 5575.

I’m seeing 5585 as current resistance for the AUS200. US30 is showing short-term support at  18385.

JPN225 – You can see how strong the moves where today off the 15 min chart. Breakout type trades today could have been disastrous. Two classic bull traps at the top of the range. The two largest moves all happened in under 30 minutes. We did have a nice bounce off the bottom of the range that produced a smooth rally. I hope seeing this chart takes away the idea of trading events like today. While there was a lot of movement, catching it is the hard part and could have resulted in some good trades but possibly a lot of damage.

AUDUSD – We had a very nice rally to start the Asian session. Once .7544 was touched we have seen a turn. .7500 is showing possible support on the 4H chart. This will need to be confirmed. The USD has started to show some strength early in the European session.

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Good Trading.
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