Obama Day

Are we waiting for a big Obama party today ? Are we confused between this early market recovery while the mess is not fully cleaned up still ? Is it yet another eye of the storm ? Yesterday was certainly calm in relation to the volatility we're now almost used to, except maybe for €/$ which broke the 1.27 MM support level to reach a Fib target around 1.255.

EURUSD should carry on hovering around same levels, and we recommend using a tick chart for intraday movements. The lower bias is still there at the moment but as said earlier, it could well bounce because 1.27 is actually stronger than the deep penetration we've seen could imply. If now tested as resistance then we will look at a lower target maybe back down to the 1.22 levels.

ER: Stalled short of 550, on its way to 562. A retracement would be in order but ER is holding nicely at these levels. One cannot discard either scenario right now, so ER can just as well go and test 562 or retrace back to low 500s again. In the short term, ER is still pushed slightly upward but the bias is fading at the moment. Will volatility play tricks again on Obama Day?

ES: If we try and make an overall picture of the markets, ES is not so bullish and is certainly indicating a need for a lower time frame. Secondly, MM resistance level has come down so we may find difficult to even come closer to the 1000 battlefield. Are belligerants ready for it? The target is there, but here again are we going to retrace first? Like for ER, we still have a very weak unconvincing upper bias for now...

(snapshots available on request)