Dow Jones Europe Index is headed for a test of the band of support between 200 and 205. A 63-day Twiggs Momentum peak below zero would warn of a strong primary down-trend. Failure of primary support would offer a target of 150*.
* Target calculation: 205 – ( 260 – 205 ) = 150
The SMH has [a] very important story this morning on the funding crisis that is bearing down on the major banks:
Australian banks are preparing for a potential freeze in global funding markets as Europe’s worsening stresses threaten to send the world’s financial markets into a tailspin. Renewed funding pressures for the big banks, which need to raise $16.3 billion over the next two months, are likely to make it tougher for business and some consumers to access credit.
via The credit crunch is coming – macrobusiness.com.au | macrobusiness.com.au.
Brazil’s Bovespa index disappointed after promising a breakout above 60000. The index failed to break through resistance, instead falling through support at 58000 to warn of another test of 48000. Rising 63-day Twiggs Momentum and Twiggs Money Flow, however, continue to indicate that the index is forming a bottom.
The Straits Times Index broke through 2700, warning of another primary down-swing. The decline of 63-day Twiggs Momentum below zero indicates a primary down-trend. Target for the initial down-swing is 2100*.
* Target calculation: 2500 – ( 2900 – 2500 ) = 2100
India’s BSE Sensex Index broke the band of primary support at 15800 to 16000, warning of a decline to 14000*. Repeated peaks below zero on 63-day Twiggs Momentum indicate a strong primary down-trend.
* Target calculation: 16 – ( 18 – 16 ) = 14
Looking at the S&P 500 weekly chart, it continues to follow the same pattern as in early 2008. There is a similar false recovery above medium-term resistance at 1200 (compared to 1400 in 2008) followed by reversal below the new support level. Also, a similar 63-day Twiggs Momentum peak below the zero line warns of a strong primary down-trend.
* Target calculation: 1100 – ( 1300 – 1100 ) = 900
The role which the European Central Bank needs to be allowed to play in resolving the European sovereign debt crisis needn’t amount to sustained financing of government deficits. It is perhaps better conceived of as being akin to central bank intervention in the currency markets.
When, in moments of one-sided speculation, or panic, foreign exchange markets push a currency to what by any reasonable yardstick appears to be extremely over- or under-valued levels, it’s not unusual for central banks to sell or buy that currency in sufficient volume to push it back in the opposite direction. If the central bank concerned is perceived as ‘credible’, the volume of purchases or sales required to achieve its objective will often be quite small. And if its judgement as to what constitutes ‘reasonable’ is correct, it will usually end up making a profit.
via Germany’s economic and political generals are fighting the wrong war – On Line Opinion – 24/11/2011.
A German government debt auction drew some of the weakest demand since the introduction of the euro, signaling diminishing investor appetite for even the safest euro-zone assets amid Europe’s worsening debt crisis….The German government was able to sell only €3.644 billion $4.92 billion of the €6 billion in 10-year bunds on auction for an average yield of 1.98%. Interest rates on Germany’s 10-year bonds rose sharply after the auction to 2.09%, their highest level in three weeks, leapfrogging the yield on the U.S. 10-year note.
Assets of all exchange-traded funds fell in September by $89.29 billion, or 8.6 percent, to $951.46 billion.
Over the past 12 months, ETF assets increased $68.71 billion, or 7.8 percent. Assets in domestic equity ETFs increased $55.08 billion since September 2010, and global equity ETFs assets fell $13.78 billion during this period.
The combined assets of the nation’s mutual funds decreased by $582.3 billion, or 5.0 percent, to $11.040 trillion in September, according to the Investment Company Institute’s official survey of the mutual fund industry.
via ICI – Trends in Mutual Fund Investing, September 2011.
The fall in Stock Funds was far greater, at 9.5%, compared to only 1.3% in Taxable Bond Funds and 0.1% in Taxable Money Market Funds.
The Prime Minister on Monday conceded that tackling Britain’s debts was “proving harder than anyone envisaged”, raising the prospect that the Coalition would be unable to close the deficit by 2014-15……Debt is “a drag on growth”, Mr Cameron told business leaders. “We are well behind where we need to be,” he said.
via David Cameron: our plan to cut debt is failing – Telegraph.
