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Technical analysis: EuroDollar Futures

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Eurodollar Future – September 2009

Fri, Jun 19 2009, 07:59 GMT
by Nicole Elliott

Mizuho Corporate Bank


Comment: Once again we wish to remind traders what can happen when the whiff of a banking problem hits sky-high futures prices: the market collapses in a frenzied clear-out, something that will remain a problem for months to come. Yesterday we suffered a smaller version of what happened on the 5th June, again a correction lower where trendline support held. Swirling rumours of potential changes to Fed policy fly in the face of the generous funding supplied by the authorities. Prices are back to a sort of ‘equilibrium’ and we continue to favour a broadly sideways move over the coming month, with very small upside biases. Front months should hold up better than red ones.

Strategy: Attempt small longs at 99.205/99.175; stop well below 99.085. Add to longs on a daily close above 99.300 to cover ahead of 99.450, then watch for signs of instability.


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Mizuho Corporate Bank  | 1-3-3, Marunouchi, Chiyoda-ku, Tokyo 100-8210
http://www.mizuho-cb.co.uk | Nicole.Elliot@mhcb.co.uk

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