Devaluation Welcome
Comments by German Chancellor
Schroeder that he welcomes the decline of the emerging pan-continental currency
because it "benefits" exporters shocked many currency traders and was
in stark opposition to recent European Central Bank efforts to ward off recent
signs of inflation.
The euro FX
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British pound
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lows last week which landed all
three contracts on the Implosion-5 and New 10-Day Lows list
Friday. The currencies rebounded when US economic reports (a seven-year low
in factory orders and an uptick in unemployment) signaled an economic slowdown
last week but the comments and lack of cohesion among political and financial
"Eurocrats" portend trouble ahead for continental currency futures.
Euro FX
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PowerRating) closed down .0110 at .88940 and Swiss francs
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fell .0078 to .5734. Pounds, from Monday’s Implosion-5 List,
closed .0068 lower at 1.4542. Going the other way, dollar index futures
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closed up 1.10 at 112.40.
Unleaded gasoline
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(
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PowerRating), from the Momentum-5
List, gapped up to new highs, taking their cue from higher energy prices in
London. The market remains skeptical that OPEC, will raise
output sufficiently to fend off any supply shortfalls anticipated during the winter
heating season.
Natural gas
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PowerRating)
is particularly noteworthy in Tuesday’s action because it reached its highest
price level ever in the 10 years that the contract has been
trading. The market is also noteworthy for following through on the break of the
neckline of an inverted head-and-shoulders pattern. NGVO closed up .115 at
4.950. Record heat in Texas drew stockpiles, which are already substantially
below normal levels, down even further, enhancing doubts that there will be
enough of the fuel to warm houses this winter
Grains, also Momentum-5
List members, are also harvested nice gains as hot, dry weather cuts back the
chances for bumper harvests and prompted funds to jump onto the buyside. November soybeans
closed up 9 1/4 to 512 3/4 and December wheat rallied 2 to 269 1/2.
In the softs, September sugar
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into its high-level base, triggering and making good on a Turtle Soup Sell
signal, a pattern which occurs on the same day in which a 20-day high fails to
breakout. Sugar closed .39 lower at 10.43.
From the Implosion-5 List
and tallying three down signals on the
Futures
Trend Matrix, coffee
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PowerRating) continued dredging the bottom, setting new
contract lows to end 1.85 lower at 78.50.