European Financials take a Hit
Stock-Markets / Financial Markets 2016 Dec 21, 2016 - 07:39 PM GMT
This is the longest-term USD chart that I can find. The structure leads me to believe that it is on a giant retracement pattern that may have an ultimate target of 131.00 at a 61.8% retracement of the decline starting in 1984. I will be making minor revisions in my daily and weekly charts to reflect that outlook.
USD has completed an impulsive rally to 103.62. It has declined beneath its Broadening Wedge trendline to 102.81 this morning, putting it on a sell signal.
European financial stocks are taking hits as rumors spread about potential bailouts...or not.
ZeroHedge reports, “Total chaos reigns in European banking stocks this morning as Monte Paschi shares crash, soar, and plunge amid on-again, off-again bail-in, bail-out headlines (and stocks and bonds hit record lows). However, Italy is now not alone as Spanish banks are also bloodbathing following a European Court ruling on mortgage fraud went against them.”
The SPX Premarket remains calm thus far. ZeroHedge reports, “US equity futures and Asian stocks were unchanged while European stocks declined after touching the highest level in almost a year, as Italian and Spanish banks dragged indexes lower. The dollar eased back from 14-year highs as bond yields fell on Wednesday and oil extended its advance in increasingly thin trading.”
Yields are declining again, although not significantly. According to the 2-hour chart, yields may dip as far as the Cycle Bottom support at 19.05 in just a few days. It is expected to see a Master Cycle low by Friday.
Regards,
Tony
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