Risk Off - Attention Opn Equities

Well the G20 summit came and went, various members of the public were arrested for public nuisance and little else came out of it. There is now a distinct disconnect between the two camps, there are those in continental Europe who firmly believe that the way forward is to remove stimulus and cut deficits (they really have little choice given the ballooning public debt numbers), while in the United States of Obama, the man himself is advocating a spend your way out of trouble policy… Based on what is hard to know, however, if you simply pump more money into the economy you'll soon be in the same position as the rest of Europe… And of course the Chinese requested that no official mention was made at the conclusion of the summit regarding their currency manipulation.

So where to from here? Well risk is off the menu for the time being and it seems that the market is solely focused on where equities are going and this is driving the currencies also.

As I've said in previous comments things are indeed quieting down for the summer break and I truly can't see myself into clear trades at the moment.

As far as levels on the day are concerned I think the Cable is well and truly overbought and worthy of a sell here but have a hard time getting in front of the freight train that is the British Pound.

I look for a retracement within the week to all the way lower into 1.4600 so keep an eye on it.

In the EURUSD I know of good offers residing above 1.2390 and 1.2410 with small stops just above there. I am seller of strength in this cross and think that on the day we look at a 1.2300/1.2390 kind of range.

The USDJPY continues to grind lower and spec long JPY positions have increased over the course of the last week, adding credence to my long JPY positioning going into summer.

I'm not particularly inspired today and look for more action in the coming days to perhaps breathe a bit more life into not only me but also this market.

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