Thursday, June 16, 2011

Market Notes Week Of June 13th-17th


**Greece Debt Crisis persist with prior downgrades earlier this week from Standard's & Poor's rating agency which downgraded Greece 8 notches below junk status. The rating Company said the nation is "increasingly likely to restructure it's debt." A restructuring would likely, "result in one or more defaults under our criteria," "Risk for the implementation of Greece's EU/IMF borrowing program are rising, given Greece's increased financing needs and ongoing internal political disagreements surrounding the policy conditions required by Greece's partners." The rating company held it's recovery rating at 4, indicating it estimates bond holders would recover only 30% to 50% of their investment.


**France's top 3 banks were also put on review by Moody's for possible downgrades for their exposure to Greece. The Greece situation seems to be an ongoing theme with the Eurozone and members in disagreement of how the handle the situation properly.


**China continued to be worried about inflation but CPI came in at 5.5% vs the 6.0% that was expected by the market. Despite some signs of slowdown China stayed hawkish about inflation and raised the bank reserve requirement by 50 basis points. This may have had some effect on crude oil's recent fallout.


**US stocks closed higher on Thursday's US session despite major questions in the economy which were overshadowed by the Greek turmoil. US stocks have been on a steady decline since May 1st of this year and this week was by no means an exception overall.


**The Euro continued to be in correction mode to the downside and has not rebounded significantly from it's recent steep fall because of the Greek factor of the equation. Despite a few upside rallies in lower time-frames it has been on the weak side.


**Crude oil continued to be afraid to dare go back over $100 USD a barrel with too many questions about the global economy at large and enough supply seems to saturate the markets with the weaker global conditions but hasn't seemed to help the consumer.


**India raises rates by 25 basis points, more hikes likely. The rate rises from India combined with other countries in hawkish mode likely is putting downside pressure on crude.


**Despite the weaker economy Gold refused to trade much lower and is near record highs despite Crude Oil's recent downtrend / unpopularity. This could be the safe-haven effect at work with the very weak USD policy and despite the fact that QE2 has ended there is however too many unanswered questions as to a "certified recovery" for there to be any real strength tap on wood.



**All eyes will continue to be on the Eurozone as to how to handle the Greece situation and which method will jointly be agreed upon.


Crude Oil Daily Bollinger Bands Chart:


Crude Oil Daily Moving Averages Chart:


Dow Jones Industrial Daily Bollinger Bands Chart:


Dow Jones Industrial Moving Averages Chart:


DAX Daily Bollinger Bands Chart:


DAX Oil Daily Moving Averages Chart:


EUR-USD Daily Bollinger Bands Chart:


EUR-USD Daily Moving Averages Chart:


Gold Daily Bollinger Bands Chart:


Gold Daily Moving Averages Chart:


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