He's saying that the EZ econ is close to full capacity. Meaning hikes are ahead. I find it funny he doesn't want to say anything about future policy - because all of his ECB buddies are chatting like a bunch of first-drunk school girls.
Nice start to the month. Closed EUR/USD short - 42+ pips Closed just one of my USD/CAD longs with 39 + pips Take care, -Kastro
Euro needs to hold 1.2795 if it expects to turn this around. Failure to do that will send a lot of folks scrambling.
I agree. I think there may be a big pop out of the 28 level also. Key area for more reasons than just being an even number. Here's what I see in general.... 1.2837 area - If we build value around here and close back above at the end of the day. It may be time to close up shop. 1.2777 - This is the next key level down and a big one. I expect a pop out of here and then above applies. Building value here and moving thru this level in the wake of the Thursday announcement would be very bearish 1.2636 - next level down. 1.2435 - This is really the key. There will be massive buying here if it ever makes it. If we build value down here and move below. I will load the truck with some more has I see a move much lower. If the ECB would just say NO hike. I will feel better. Bond market is sending me mixed signals also. DRT PS - I am watching the USDJPY closely. The move above 112.50 was very significant in my opinion. So far it has not been knocked down substantially. If we settle comfortable above this 112.50 level today, I see some big moves up here also. Jury is out on this but I am long for now.
The ECB isn't going to say "no hike", so if I were you, I'd get that out of your head to avoid disappointment right now. You'll see a quarter point. I might be wrong, but when it comes to rates I'm usually not. Interestingly enough, a whole lot of 1.26 EUR ops were purchased today.
The $Index has slammed into 84.90 which I have a key level. If it get thru there in front of Thursday I will be surprised. I'm not sure the old gal has it in her.
18:04 EUR/USD: Consolidation Continues after Jawboning] Boston, June 6. The past several months have been remarkable in that European finance ministers have mostly refrained from trying to talk down the EUR. The gloves came of today though as Junkers, the head of the Euro Group, Solbes, the Spanish finance minister and former EU economic czar, as well as Grasser, Austria"s finance minister. While the group will claim not to be trying to influence ECB policy, the stepped up attack on the EUR two days before the first ECB meeting in years where a 50 bp hike will be discussed is hardly coincidental. The IMF is weighing in with similar sentiments, saying there is room for some tightening of ECB policy but that conditions for substantial tightening are not in place. The strong EUR is hindering Eurozone growth and the strong EUR signals the need for caution on rates. EUR/USD is consolidating losses in the low 1.2820s. 1.2800/10 bids are eyed on dips; more are seen at 1.2780/90.