€Euro and Money Flows

So where is the money going? This is a 3 month chart of some key currencies and economically sensitive tickers.

FXE Euro € vs key tickers

FXE Euro € vs key tickers

Clearly, the Euro is dropping. This chart is vs the $US, showing that Euro vs $US is in favor the $US.

At the bottom of the page is the green line for FXY – Japanese Yen. It has been in a spectacular plunge under JCB Japan Central Bank pressure. Note that they have turned up at the far right. Money is flowing into Yen, despite the JCB.

JJC is copper. It is dropping, with the usual metals volatility. The economy is not getting better and folks are not building a lot of houses, cars, and electronics. China is not buying inventories of copper. They are not seeing large order for future delivery of product.

FXB the British Pound, that blue line, had been dropping almost as much as the Yen. It is now rising as of the start of the Cyprus collapse. Folks are moving money to the UK.

FXA the Australian Dollar, also getting a lift. Some of that UK related money going down under?

Hard to read on the chart as the line is hard to see, but GLD has been dropping until this event, it is now rising. Realize this is in the context of a strong $US, which means gold is rising even more than the $US which is rising vs the €.

Even TLT long duration bonds, are showing a bit of lift at the right end. Folks moving out of deposit accounts and into US Bonds & Treasuries. Even with The Fed making them “uninteresting” and with the cycle of markets approaching the time that The Fed ought to start raising rates (lowering bond prices).

Oddly, that light grey line of FXF says the money is not flooding into the Swiss Franc. Guess they are a bit ‘cool’ on ‘haven’ banks…

It also looks like Oil USO is rising. Related? Not related? Hard to say, but not driven by more economic activity.

So looks to me like mostly flowing to big Money Centers and very safe instruments.

I was going to chart the Ruble, but the ETF for it is not being recognized as a ticker by BigCharts. It is pulling up a Russel 2000 index instead. But there is money flowing into Russia as well.

Looks to me like a Run On The Euro.

Update per Yen

Interesting… Yen chart looking like an ‘early call’ on ‘bottom soon’:

FXY Yen vs other currencies and econ sensitives

FXY Yen vs other currencies and econ sensitives

Price has not crossed the SMA stack, but the stack is starting the ‘compress and inflect / weave formation’ process.

The RSI had an ‘at 20’ then ‘higher lows’. So “bottom soon”. Now we’ve got a failed rise, then a bit lower, and another rise. The ‘first rise’ off a bottom is the DCB “Dead Cat Bounce” and often just indicates “shorts covering” not a new uptrend. My typical “rule” is to wait for price to cross the SMA stack, return to it from above, and fail to punch through to the downside. Then again, this is a Central Banker Driven Market, so who knows what they will do…

The price curve itself is showing deceleration / inflection. MACD is still ‘below zero’ but with blue on top and clear deflection upward with decent slope, so not confirmed up yet, but testing it. DMI had been horridly ‘red on top’ with ADX showing strength (above 20). Now ADX has inflected and DMI is in a blue / red weave. Again, a “change of trend likely”.

The question, of course, is ‘will it go up?’ or is this the JCB just doing a controlled landing at 20% off…

In either case, it is now likely that the Yen is an OK place to stick cash again. Certainly better than the Euro.

Subscribe to feed

About E.M.Smith

A technical managerial sort interested in things from Stonehenge to computer science. My present "hot buttons' are the mythology of Climate Change and ancient metrology; but things change...
This entry was posted in Economics - Trading - and Money, Political Current Events and tagged , , , . Bookmark the permalink.

6 Responses to €Euro and Money Flows

  1. E.M.Smith says:

    Odd, this topic wasn’t getting any comments, and when I looked at it, comments were turned off. I didn’t do it, and default is to allow comments, so something ‘glitched’…

    Looks like € is continuing to be in a down trend…

  2. E.M.Smith says:

    Wow. Bonds TLT shooting up. Guess that Euro money is running to US Treasuries. Yen resumed tanking… not safe yet. Euro showing some small signs of life (or central bank pressure…)

    Still all in all saying things are unstable and a mess.

  3. DirkH says:

    Ides of March over; the usual peak at start of month over; unemployment reports serves as the reason the markets can use to take the long missed dive into the abbyss. DAX, MDAX, SDAX down as well.

  4. P.G.Sharrow says:

    Head of Japanese Central Bank plans to DOUBLE the amount of Yen in circulation. Another hitch hiker to the bottom! Massive inflation is being baked into the world financial pie. pg

  5. Paul Hanlon says:

    I’m surprised the latest news from Spain hasn’t gained more traction. It would appear that thousands of people are likely to be bilked out of their life savings by a few banks who issued “preference shares” (which turned out to be anything but). And the Spanish government seemed to be aware of it at the time. The total amounts to €7BN, and the investors are being offered 30c per Euro. Some of them, called los indignados, are suing, and are looking to the Spanish government to reimburse them from the 100BN of bailout money that’s still left. It just gets better and better over here (/sarc).

Comments are closed.