Saber Rattling Fortifies Swiss Franc
We’re seeing a massive decoupling in the normally highly correlated
Swiss franc
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currencies usually move in tandem, but George Bush’s speech to last night
that warned the Taliban to hand over Osama bin Laden and his lieutenants or
else has changed that. The threat of war, and its possible repercussions around the world, is
spurring safe-haven buying, and the perceived neutrality of the Swiss and
their reputation as trustworthy bankers caused a spike in overnight trading
in the Swiss, as currency traders swapped euros for Swiss francs.
The leader of the Momentum-5
List, the franc, bolted to a near contract high, while the
euro FX plunged in overnight trade. Both are lower in trading at the CME
with the Swiss unit starting to find a bottom after filling the overnight
gap.
The big downtick in the euro FX is bolstering dollar index futures
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index, and the ECZ1 move down .01530 is DXZ positive.
Closing out the week with their worst weekly loss ever, stock index
futures gapped down on the open. As we’ve seen in gaps on either side of the
market in opening minutes, locals once again were fading the extremes. This
morning, there was an opportunity to get long
December Nasdaq 100 futures
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S&P futures
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into the session. In the S&Ps, the market made a double bottom on the
five-minute bars at 939.00. The ensuing rally, from down 45.00 to up 5.00 on
the session was another example of extreme volatility.
Ten-year notes
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and T-bonds
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safety.
Also flight-to-safety moves, December gold
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silver
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but have sold off from their highest levels of the session. Notice that
silver, trading on a shortened time schedule, closed in a Slim Jim and
should be monitored for a move out of the consolidation. Since the contract
is on the Momentum-5
List, the move is likely to be higher.