Good morning traders. We have seen a very quiet start to the European session this morning as all eyes will be on Washington this morning as the US House of Representatives vote to suspend the countries borrowing limit also known as 'Kicking the can down the road' until May 19Th.
Last night after the close we saw $GOOG smashing its fourth quarter earnings, advancing the stock by nearly 5% in after-hours trading.
This gave a healthy boost to most US asset classes, we saw $DOW breach the significant 13,700 level which has proved as previous resistance the index reached a high on 13,754 but is currently off these highs at the time of writing. The $SPX also took a move to the upside testing 1,497 levels but failed to test the 1,500 level. We are all waiting to see if the 1,500 level can be broken but for traders it is important to note that it may struggle to break through this level on its first attempt but a slight pull back would provide a great buying opportunity and all traders should be looking to 'Buy On Dips' in the current market as long as the Fiscal Cliff remains in the background.
In the FX markets we have seen the Eur weaken against more of the major pairs over night and during the trading session yesterday. The EUR/USD is hoovering around the 1.3300 level and this should provide a base but if this level is breached 1.3200 could be the next target.
The EUR/JPY has seen a significant move to the downside and a fundamental retracement from its 1.20 highs, and it is look as though its going to test the 21 day moving average on the daily chart at 116.235. From traders trading the Eur the mindset should be 'Sell On Rallies'...
Just one thing to note $AAPL report earnings after the close today and this should have a significant impact on the US equity markets, a poor result could provide a nice buying opportunity.
Happy Trading
@lowkeycapital
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