The nice thing about protecting barriers, when it works, is that when the market reverses, you get to take the other side of the trade. Case in point; China defended 1.5000 this morning. It can now load up on EUR/USD on dips, and likely will. We’d be surprised if they were already in at 1.4925, but I’d not be surprised if they came in in the 1.4850/75 area.
US Housing Secretary Donovan is on the wires this morning. He says the government has not yet decided to extend the $8000 tax credit for first-time home buyers, saying it is very expensive for the government. A decision will come in the next few weeks, he says. Markets hate uncertainty, and the state of the US housing market remains “uncertain”, to say the least. That’s a downer for the stock market today.