Euro & Swiss Launching
Spooked about the high value of the dollar relative to
its major trading partners, the National Association of Manufacturers said it
will pressure government officials to reduce the value of the currency. The
organization is concerned that an “overvalued” dollar will make US
manufactured goods more expensive and slow recovery of the manufacturing sector
which many consider in a recession.Â
The prospect of a governmental lower-dollar stance is
spurring an explosion in continental currency futures with the
euro FX futures
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PowerRating),
Swiss franc
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PowerRating), and
British pound
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PowerRating) logging some of their best gains of the year.
The euro FX and Swiss francs are also tracing outside days two days after a
Turtle Soup bottom. Yesterday’s gap and today’s expansion bar in these contracts
are definite signs of nascent momentum and suggests they will fill the gap left
on May 22.Â
In debt futures,
September T-bonds
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PowerRating) and
10-year notes
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PowerRating)Â are higher and both are making good on
their “early momentum indicating”
New 10-Day Highs List and on Off The Blocks
entries. A subdued as-expected Producer Price Index out today tempers inflation fears and gives the Fed greater leeway to cut rates. The July
Federal Funds contract
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PowerRating) is trading at a contract high and pricing in
as high as a 28% chance of a 50-basis-point
cut.Â
As mentioned two days
ago, heating oil
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PowerRating)Â held a gap when it jumped above
its 10- and 20-day lines and followed up with an expansion bar. (This action is
similar to what we are seeing in the euro FX and Swiss franc). The
contract is now trading at an eight-month high, is on today’s Momentum-5
List, was on yesterday’s New 10-Day List, and is making good on an Off The Blocks
entry.