Forget March, Remember April?

March has typically been a quiet month for equities trading as mentioned in the Straits Times on 27th Feb. We also know that the March we are heralding is a month of uncertainty after 2 months of strong uptrend. The market is struggling with an effort to make a decision and is swinging up and down every other minute. Yes, this is the March that may unfold - testing, volatile and unproven.

But yet, it is not going to be the most defining month.

The IMF has deferred several key initiatives aimed to bolster the firepower provided by the European Central Bank and European Union members for Greece. And has remained coy about providing concrete agreements to support the work of the EU. Reason is obvious - Greece can agree to the austerity measures and policy reforms but does it have the strengths and support from other members of the EU to pull through? Are their lawmakers serious about making this happen and can and will withstand the backlash from their citizens? Plugging one gaping hole still leaves water leaking from others and a real concerted effort is necessary to ensure the survival and return-to-growth of the EU on a whole. Prospects are looking feasible now with a certain degree of solidarity amongst key EU members but it must hold.

The bickering and negotiations will continue. It must. And until April when the IMF and G-20 meets again will we get a truer picture to where this may lead us.

G-20 2012 Mexico Statement

Euro Zone Bank Stress Test

Given the volatility of the market over the last 2-3 days, I am deciding to sit on the sidelines and watch what unfolds before deciding what to do with my money. Breaking away from technically analysing stocks/markets, I thought it will be a refreshing and useful addon to share a bank stress test calculator prepared by Reuters. Full Link Here.
By sliding those bars, you can see how much debt haircut the Euro zone PIIGS have to do in order help to avert a national/regional disaster. Plenty of food for thought and realising the implications of this debt crisis. One hole is leaking while we fix the other.

It is huge and it is still not over. Much more to do still.

Source: Reuters

Euro's Plunge is Recovering.

So is the world and its economic sentiments.

Chart obtained from Euro/SGD Rates on Yahoo Finance.

First, the news of payroll, employment and other economic data coming out of US have been positive and suggesting recovery. It has been suggested that the US will grow slightly in this year and lead Europe out of its recession.

Second, the Greek issue has been slowly resolved and expect Greece to have a second bailout by the end of this week after all the hard work from members of the EU.

Thirdly, the Euro has been gradually strengthening over the month. Looking at the chart above, it seems like a double bottom has played out and the Euro is on a recovery against the Sing dollar as has been the case against the greenback too. This is ideal as well as it shows the appetite and the confidence slowly building back into the Euro after the crash last December after reports of a suggested Greek default being on the cards.

Headwinds lie ahead of course but for those of us trading, I believe there are money making opportunities that are surfacing today. The confidence and conviction to trade given these sensible news and real data being presented are telling. But as the nag goes, do take note of your time horizon of trade and do not anticipate too long a trade. Given we are not totally out of the malaise climate yet, do not take too high a risk. High risk high returns. High risk high losses. Trade, profit and enjoy yourself. Stay sustainable this week.