- EU rescue package takes pressure off the respective bond markets. PIGS will have access to funding to rollover debt as they fall due. Read that EUR 750 bio is sufficient to cover maturing P+I for all PIGS till 2013. Bond charts reflect this, with yields pulling back sharply from panic spike levels. Can put these charts away for good now, unless the rescue unravels for whatever reason.
- Instead, questions about sustainability of the common currency model will now manifest itself in the EUR/fx (and possibly bunds). Going forward then, I will be making trading EUR/USD one of my key focus. This movie is going to end badly. A lot more downside to come. Next, sell stop-in below 1.2520.
- EUR/USD : Pre-rescue (Fri) close=1.2759 ; 2nd trading day after rescue, lower already. Looks like EUR 750 bio does not buy very much these days.
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