Week ahead in Trading webinar this Monday at 9:30AM

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The Commitment of Traders show an increase in net EURO short position.

In for another squeeze higher next week?  The change WoW was +10%.

Lagarde says this time bailout to Greece will require deliverable fiscal adjustments

• She adds the Greek program requires significant PSI. 

EURUSD moves toward 38.2% retracement. Topside trendline also getting closer

The EURUSD is approaching some upside targets for the pair.   The first is the underside of the trendline on the hourly chart above. That level comes in at the 1.3222 level currently. The next would be the 38.2% of the move down from the October 27th high. That level comes in at the 1.32429 level. Finally, the top channel trendline on the daily at the 1.3252 is also approaching.

With the days range for the EURUSD above the average range, I would expect that traders might look to take some profit against these levels before the weekend.

Fitch cuts Spain, Italy, Cyprus, Belgium, Slovenia, affirms Ireland

• Italy cut to A- from A+ Outlook Negative
• Belgium cut to AA from AA + Outlook Negative
• Cyprus cut to BB- from BBB Outlook Negative
• Spain cut to A from AA- Outlook negative
• Slovenia cut to A from AA- Outlook Negative
• Ireland was affirms rating at BBB+ Outlook Negative

Spain, Belgium, Italy, Slovenia, Cyprus All Cut by Fitch

Week ahead in Trading webinar this Monday at 9:30AM

Week ahead in Trading webinar this Monday at 9:30AM – Get all the hot topics and new trends for the week from Greg Michalowski and Shawn Powell – Register now

USDCHF moves below 100 day MA

The USDCHF has moved to new lows and also below the 100 day MA at the 0.91475 level. This is the first time the price has dipped below this level since the intervention on September 5th.

EURUSD makes new highs…

The Friday afternoon squeeze is on as hopes for Greek solution and weaker GDP lead to the dollars decline.   In Greece the comment from a spokesperson is there is one step left for an agreement.  At the same time the word is a 2nd bailout may be coming from the EU but further funding from the EU is coming to an end.  Maybe the haircut will get them over the hump and they can fund addtional payments through positive cash flow and austerity measures, but if they can not, I do not think tapping the debt market will be an option.  The situation is still vague but the market is getting used to it and it may just be a big stall to allow banks more time to shore up balance sheets via the ECB version of QE.

Meanwhile, in the US, the market is realizing that the GDP was not all that great and with a dovish Bernanke/Fed  behind the wheel promoting a lower dollar and the potential for more QE, maybe that is the way to go.  The only thing missing today is a roaring stock market in the US.

Greek debt deal in principle by Sunday evening.

• Greek official adds, that the EU will not fill any funding shortfall after 2nd bailout, but there are other ways.

More vague comments and solutions.

EURUSD breaks trendline . Weeks high the next target

The EURUSD broke out of the triangle formation and stops triggered. The range for the day was extended on the move. The high for the week came in at 1.3183. This is the next target.

UK Miles says presumptuos to think QE in Feb is a done deal

• QE will hinge on forecasts
• He adds that there is substantial spare capacity in the UK economy.  This will persist into the future
• CPI is on a pretty steep downward path
• Confident it wil fall as forecast
• Would be no great surprise if the UK suffers technical recesssion

I don’t know why given the above statements it would not be extended but I guess he can have his opinion.

As fast as the GBPUSD went down, the pair has retraced 50% . The 200 bar MA  and midpoint of the days range is the next target.

GBPUSD tumbles. Talk of a UK clearer selling

The GBPUSD took a tumble lower. Market chatter is a UK clearer was selling (this is not confirmed). The price fell below the trendline support outlined in the morning commentary. The price is now below the 38.2% of the weeks trading range at the 1.56498 level.

The next key target comes in at the 1.56241 level.  The level corresponds with the 50% retracement and the 100 hour MA.

University of Michigan Confidence Rises to 75.0 from Prior and Survey of 74.0

75.0 highlest level since February 2011

Jan 12 vs. Dec 11
Consumer Confidence: 74.0 vs 69.9
Economic Conditions: 82.6 vs 79.6
Economic Outlook: 68.4 vs 63.6