Your MUST-READ Morning Stock Futures Cheat Sheet: Risk aversion

The exclusive Markets Morning Report is supplied by The Precision Report.

The Precise Take – Risk aversion

Big Picture Analysis:  In a matter of days, the ES has dropped 90 handles from its 50% retracement ~1230 high last week.  Problems in Europe continue to intensify and, overnight, the Swiss National Bank announced it would temporarily peg its currency to the Euro at 1.20, resulting in some rather stunning moves in the foreign exchange markets.  While central banks’ efforts to “defend” their currency are destined to fail, a CB has unlimited firepower to weaken its currency should it choose to do so, which is where the SNB is right now.  The climate is more and more reminiscent of 2008 in terms of price action, liquidity and regime uncertainty.  Though market participants expect an eventual resolution, the path remains unclear.  The FOMC meets in two weeks and the administration is likely to announce a sweeping new mortgage writedown program.  Accordingly, it is difficult to imagine large investors committing fresh capital to the risk markets at these levels; however, we continue to believe a flush over the coming weeks could set the stage for a powerful bear market rally.

Trading Today:   Below are marked the support and resistance areas.  News at 10:00 am could be a market mover.

Today’s  Scheduled News (all times EDT)

Major Market Movers
ISM Non-Mfg Survey at 10:00 am

Minor Market Movers
None

Tuesday’s Scheduled News

Major Market Movers
Fed Beige Book at 2:00 pm

Minor Market Movers
None


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