It was thoughtful of eurostat to include the US in their chart. Funny, that’s not the chart one would picture based on the MSM’s steady drumbeat of “recovery!”
Germany, which had previously taken an ambivalent attitude about the soaring euro, might change its tune following its worst GDP print since Q408. The main culprit? Exports, which fell 15.4% from November – the worst monthly decline since 2007 – and 5.7% YoY. Straight from the Bundesbank:
Housing figures for Q4 should be out soon, but look for a continuation of the slide.
A falling euro might increase exports, but make oil even more expensive – the same energy/export conundrum in which Japan finds itself.
UPDATE: 12:20 PM
SPX continues to move sideways. The H&S pattern completed yesterday busted, completed again, busted, and is working on completing a third time. This is a very ugly pattern, with hardly anything normal about it — especially the 3 right shoulders.
It should have already paid off yesterday with a trip down to 1511ish. The red channel I drew yesterday is holding nicely so far, but a departure to the downside this morning was quickly erased. It even fell through the larger red channel midline but rebounded.
Clearly, the bulls are trying valiantly to defend the 1520 level. But, can they?
continued for members…
If the bears can get any downside going, there’s another H&S Pattern to be had at 1514 or so. It would target 1503 — the current midline of the white channel that’s guided prices higher since 1343 in November.
Watch the red channel. Any breakout and I’ll put on another intra-day long.
UPDATE: 2:20 PM
The red channel gave up the ghost, so I’m proposing the white channel in its place.
Looks like a Gartley at 1422.41 or, more likely, a Bat at the .886 of 1523.47 for this retrace — it would intersect with the big, yellow channel line that marks the top of the ending diagonal.
I’m closing my intra-day longs here at 1522.50, but would pick them back up again with any move through 1524.69.
We need to see a drop below 1514 to consider the H&S Pattern completed. Again, it targets about 1503 – but potentially sets up more patterns targeting lower.
UPDATE: 3:20 PM
I have to run out for a little Valentine’s Day activities, but will post more this evening.
GLTA.
UPDATE: EOD
Comments
One response to “What Recovery?”
Hello PW, good chart in EUR/USD. In regard to your “What recovery”, I have a story on “What Recession?” this morning. Someone asked me why the stock future dropped in the morning, I explained that Europe just showed the sign of another recession with bad data. His reply was “What Recession. There is talk on recession here, there every year. And so what?” ( He was referring to near all time high of the stock market while this talk of recession becomes an annual event) And it does not take a stock analyst to predict the market probably close green starting 3:45pm regardless of the bad news.
I was speechless. He got a point. Since March 2009, there was always talk of on going recession (or double dip recession) .
No joke. But I guess it is hard to talk about bad thing when people don’t care or don’t believe it.