Breakfast Blog

Good Morning Traders, Yesterday was another Up and Down day in the Stock exchange, Selling off in the Morning and then rallying all afternoon until the close when it failed to make a new high and sold off. The S&P 500 has been ranging between 1465 and 1475 in a controlled manner but does not have a macro stimulus to create a breakout that all traders are waiting for. This will not continue for long, The market is too high and overbought and a correction is only a matter of time.
Apple was the out performer of the day, Up 4% or $20 to close above the $500 mark. This helped drag up the Nasdaq and the S&P 500. Boeing was the notable under performer of the day, down 3.5% after more problems with their new Airplane the Dreamline and weighed down the Dow Jones 30.
From a currency perspective Yesterday the EUR/USD had no fundamental driver and drifted in line with the Equity markets in a range from 1.326- 1.333. Just as I type the pair has broken out higher and sits at 1.335. Market talk is their is notable corporate sellers between 1.335-70, this may cap the upside for now, but the Euro does seem bullish and we believe that their is definitely more room to the topside. A near term target we are looking at is 1.3490, This was the 2012 high and is the 50% fibonacci retracement of the 1.50-1.20 fall in the EUR/USD and we can guarantee that 90% of Euro bulls will be looking to take some profit here on any long trades.
A quite day on the European data calendar, with the only potential market moving news is 2 bond auctions from Italy and Spain. On the other side of the pond we see Initial Jobless claims at 13 30 and Philly Fed Manufacturing at 15 00. Some levels to look out for are 1475 to 1465 on the S&P 500. On a EUR/USD 1.324-6 looks like very solid support and 1.335-70 is initial resistance on the topside.
USD/JPY has continued its parabolic upward move and looks a buy the dip trade on any pullback.
Good luck in the Markets!