28/11/2011

Why the markets are up today

Last Friday there was a short covering rally in the Euro from the weeks low at 1.3211 up to 1.3296 within two hours before it fell back to close the week a 1.3236. Sunday the Euro opened at CET 18:00 - 7 hours before the SP500 - with a new and more powerful rally up to 1.3341. Accordingly the SP500 opened with big gap at 1.172.65 from Friday close at 1.154.40. The Euro and SP500 then went sideways until  Europe opened with heavy short covering pushing the Euro and SP500 to new highs 1.3398 and SP500 1.189.99.
Since then until now the trend has been sideways again possible waiting for the US to open.

SP500 has now closed its first gap at 1.186.69. The second gap is at 1.214.72.

Of course there is a planed intervention behind all of this. It could be be the ECB wanting the euro to stop falling or someone big player who saw this as a perfect way to change the stock markets to an upside trend.
ECB has the German Bundesbank which is a specialist on currency intervention since the 1970:s.

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