The next lines in the sand for the bulls

More John J Hardy, 02 December 201102 December 2011 Non-Independent Investment Research We had quite a move earlier this week – and ahead of today’s nonfarm payrolls, we have a look at a few levels that are the last lines of resistance in the days to come if the move continues.

Looking across markets, it is clear that the coordinated intervention this week has blasted markets through the first series of resistance levels, and today we look at the “next “ lines in the sand here across markets that will either hold or fold.

EURUSD
The EURUSD bounce has been far less pronounced than for other currencies positively correlated with risk appetite like AUD and SEK, likely because the possible “solution” to the EU’s woes would involve lower interest rates and more explicit QE (we say “more explicit” because it is already going on, just not as massively as it could be). As such, the next key line of resistance is the 1.3600/50 area, which coincides with the 55-day moving average and the 0.382 Fibo retracement of the wave from the 1.4200