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DR Congo rebels 'advance on Goma'

2012-07-09T19:34:00.000-07:00

DR Congo rebels 'advance on Goma'

The government of the Democratic Republic of Congo has expressed alarm as rebel forces advance towards the country's main eastern city of Goma.

Witnesses told the BBC that rebels of the M23 group were 40km (25 miles) from the city, near the Rwandan border.

They said rebels appeared to be taking towns and villages with ease, with government troops usually melting away.

The Congolese government and the UN say Rwanda is backing the rebels, a claim Rwanda denies.

DR Congo has accused its neighbour of wanting to keep it unstable so it can exploit its rich mineral wealth.

The Congolese government has called on the international community to condemn Rwanda.

On Sunday, rebels were reported to have seized the strategic town of Rutshuru, 70km north of Goma.

A senior official at a national conservation park speaking on Monday just 40km north of Goma, told the BBC that "the rebels are very much in control of this area".

Flexing muscles

BBC international development correspondent Mark Doyle says it is not clear if the rebels intend to attack the city.

If they do, there will be a new and massive humanitarian crisis, he says.

However, the rebels may only be flexing their muscles to strengthen their negotiating position with the government, our correspondent adds.

The rebels - who took up arms in April - named themselves the M23 after a failed peace agreement signed on 23 March three years ago.

They are supporters of renegade Gen Bosco Ntaganda, who is wanted for war crimes by the International Criminal Court (ICC).

Gen Ntaganda is an ethnic Tutsi - like the majority of Rwanda's leadership - and a recent UN report accused Rwanda of backing the rebels.

Kikaya Bin Karubi, the Congolese Ambassador to the UK, told the BBC: "The United Nations Group of Experts last week published a report that says clearly that the so-called M23 are using Rwandan soldiers - and that's the United Nations talking, not us."

Rwanda has vehemently denied the accusations.

The M23 rebels defected from the army amid pressure on the government to arrest Gen Ntaganda.

An estimated 200,000 people have fled their homes since April, with about 20,000 crossing the border to Uganda and Rwanda.

Eastern DR Congo has been plagued by years of fighting.

In 1994, more than a million Rwandan ethnic Hutus crossed the border following the genocide in which some 800,000 people - mostly Tutsis - were slaughtered.

Rwanda has twice invaded its much-larger neighbour, saying it was trying to take action against Hutu rebels based in DR Congo. Uganda also sent troops into DR Congo during the 1997-2003 conflict.

Egypt military 'warns' President Mursi over parliament decision

2012-07-09T19:31:00.003-07:00

Egypt military 'warns' President Mursi over parliament decision

Egypt's military council has said the decision to dissolve the country's parliament must be upheld, after new President Mohammed Mursi ordered the assembly to reopen.

The military closed parliament last month after a court ruling.

Its latest intervention is seen by some as a challenge and warning to the president, sworn in barely a week ago.

The military council said it was confident "all state institutions" would respect the law and constitution.

The BBC's Jon Leyne, in Cairo, says the political truce in Egypt appears over.

Crowds were gathering in Tahrir Square ahead of a parliamentary meeting called for 10:00 (08:00 GMT) on Tuesday, in defiance of the military's decision.

'Binding and final'

The statement from the Supreme Council of the Armed Forces (Scaf) will infuriate the Muslim Brotherhood, our correspondent says.

Members of the Brotherhood believe it was the military that failed to respect the law by giving itself new powers after dissolving parliament last month, he says.

Earlier on Monday, the Supreme Constitutional Court rejected the decree issued by Mr Mursi the day before to reconvene the Muslim Brotherhood-dominated parliament.

The court said its 14 June ruling - that part of last year's parliamentary election was unconstitutional - was binding and final.

But army units posted outside the parliament building had already left and some MPs had gone in for the first time since the assembly was dissolved.

As the court had not itself ordered the dissolution of parliament, Mr Mursi was not directly challenging a court order, our correspondent says.

No mention was made of the court's ruling in the decree. And presidential spokesman Yasir Ali argued that Mr Mursi had been quite legitimate in suspending the dissolution until new parliamentary elections took place within 60 days of a new constitution being ratified.

Despite the apparent tensions, the president and Field Marshal Hussein Tantawi, who heads Scaf, appeared together at a military cadet graduation ceremony on Monday.

'Waste of authority'

The president's order has not, however, been welcomed by political rivals.

Former presidential candidate Abdul Moneim Aboul Fotouh was said to have denounced his move as unconstitutional while another, Hamdin Sabbahi, was quoted as saying it was a "waste of legal authority".

Liberal MP Mohammed Abu Hamed urged Scaf to challenge what he called "this constitutional coup".

The constitutional court is due to hear a number of appeals against the decree on Tuesday, reports say.

Mr Mursi won the country's first free presidential election last month, and army chiefs formally handed over power on 30 June.

Before Mr Mursi's inauguration, the military granted itself sweeping powers.

The commanders' constitutional declaration stripped the president of any authority over the military, gave military chiefs legislative powers, and the power to veto the new constitution, which has yet to be drafted.

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Japanese Yen Strength Persists; EURUSD Consolidates

2012-07-09T19:24:00.000-07:00

Japanese Yen Strength Persists; EURUSD Consolidates

The carry trade continued to unwind on Monday as the Australian and New Zealand Dollars continued to shed ground against the safe havens, the Japanese Yen and the US Dollar. Pressure has been on high beta currencies and risk-correlated assets as Asian investors react to Friday’s disappointing US Nonfarm Payrolls report for June, as well as some discouraging Chinese data in the overnight that suggests deflation may be becoming a concern for policymakers in one of the world’s most important economies.

With the issues raised thus far on Monday firmly rooted in Asia, the Euro has had a chance to consolidate slightly to the downside against the Japanese Yen and the US Dollar. As the technical notes show below, it’s evident that the EURUSD is deeply oversold, with these extreme technical conditions saturating even the 8-hour charts. It’s of my opinion that, without a significant catalyst, the EURUSD is primed to consolidate if not rebound in the coming periods before the next leg of the sell-off hits.

For now, we continue to watch European credit markets as our guide. The Italian 2-year note yield has risen to 4.067 % (+34.4-bps) while the Spanish 2-year note yield has risen to 4.877% (+15.3-bps). The Italian 10-year note yield has risen to 6.094% (+10.0-bps) while the Spanish 10-year note yield has risen to 6.995% (+12.5-bps); higher yields imply lower prices.

RELATIVE PERFORMANCE (versus USD): 10:28 GMT

JPY: +0.11%
CHF: +0.09%
EUR: +0.09%
CAD: -0.03%
GBP: -0.06%
AUD:-0.38%
NZD: -0.41%
Dow Jones FXCM Dollar Index (Ticker: USDOLLAR): +0.03% (+1.08% past 5-days)

ECONOMIC CALENDAR

The economic docket is rather dry in the coming hours, with perhaps the most important event being the US Consumer Credit report for May. Beyond today’s docket, we continue to look for headlines out of Europe as the ECOFIN Council meets to discuss further measures to stem the crisis.

TECHNICAL OUTLOOK

EURUSD: The Symmetrical Triangle on the daily chart has broken to the downside, and we have traded into our first level of support at 1.2285/90. The new yearly lows set on Friday and today at 1.2255/90 suggest further losses ahead; though with the pair significantly oversold even up to the 8-hour chart, it’s likely that, without a catalyst, the EURUSD consolidates or rallies in the periods ahead. Given the measured move and Fibonacci extensions, we are looking for a move towards 1.1695-1.1875 over the next eight-weeks. Resistance now comes in at 1.2440/80, former support on the Symmetrical Triangle.

USDJPY: The USDJPY is working on an Inverted Head & Shoulders pattern off of the June 1 low, with the neckline coming in at 80.60/70. Only a daily close above this level will signal the commencement of this pattern. With the Head at 77.60/70, this suggests a measured move towards 83.60/70 once initiated. Near-term support comes in at 78.90/95 (200-DMA). Price action to remain range bound as long as advances are capped by 80.60/70.

GBPUSD: Fresh news lows on Friday at 1.5460 have yielded little follow-through thus far on Monday, and it appears that we have the early stages of a Doji daily candle (also an Inside Day) at work on the daily chart. This would signal a near-term reversal and clear the way for some GBPUSD strength over the next few sessions. Resistance comes in at 1.5600/05 (20-DMA) then the monthly high at 1.5720/25. Near-term support comes in at 1.5460 then 1.5425 (Bollinger Band).

AUDUSD:The pair has settled back below the crucial 1.0250/60 area (100-DMA, 200-DMA) and has since pulled back below the pivotal 1.0210/15 level. It thus appears, now that there was a new low set on Friday, that prices have reversed and further losses are ahead. Near-term resistance comes in at 1.0250/60 and 1.0325/30 (monthly high); a break above 1.0325/30 would signal a reversal and point to more gains towards 1.0365/85. Support now comes in at 1.0120/25 (20-DMA), 1.0080 (former intraday swing highs), and 1.0005/10 (50-DMA, Bollinger Band).

— Written by Christopher Vecchio, Currency Analyst

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com. Follow him on Twitter at @CVecchioFX

To be added to Christopher’s e-mail distribution list, send an e-mail with subject line “Distribution List” to cvecchio@dailyfx.com

Jordan Says Cap Enforcement is Appropriate for Economy

2012-07-03T06:28:00.003-07:00

Jordan Says Cap Enforcement is Appropriate for Economy

Tradervox.com (Dublin) – The SNB president Thomas Jordan in an interview to be released later that the enforcement of the currency ceiling imposed last year is appropriate to avoid deflation. He added that the bank is determined to keep the minimum exchange rate since it is the right monetary policy for the country’s economy. The remarks by the SNB President were echoed by the SNB Spokesman Walter who said the bank is doing all it can to hold the cap.

According to Swiss National Bank data, the foreign-currency reserves climbed by 20 percent in the first five months of the year as policy makers defended the 1.20 ceiling which has been beneficial to exporters and has reduced deflation. The strain on the currency increased since investors are buying it as a safe haven currency with the crisis in Europe continuing to escalate. However, the recent EU decision will help the in the SNB’s fight against deflation.

Jordan indicated that the expansion of the bank’s balance sheet is in accordance with the monetary policy and despite the risks associated with that the bank will be able to bear them. Reports from the SNB indicated that the foreign reserves climbed to 306.1 billion francs in May from April’s 247.2 billion francs.

The Swiss National Bank is buying euros which are increasing the number of francs available to the Switzerland lenders. In a statement released by the SonntagsBlick newspaper prior to publishing the full interview, SNB forecasts a safe sail in terms of inflation throughout next year. In the month prior to the introduction of the cap, the franc had increased by 17 percent against the euro causing losses in the export industry. The franc was trading at 1.20120 against the euro at the close of last month. The Swiss currency traded at 94.94 centimes against the dollar.

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British Pound, Euro Consolidate Ahead of Key Central Bank Meetings

2012-07-03T06:26:00.001-07:00

By Christopher Vecchio, Currency Analyst for DailyFX.com

There’s been little follow-through by high beta currencies and risk-correlated assets from Friday, when the Australian Dollar and the Euro had their strongest days against the US Dollar since November 30, 2011. Quizzically, the lack of follow-through in FX markets has occurred alongside some further strength in the commodity complex, where Crude Oil and Gold have posted gains of +1.79% and +0.81% thus far on Tuesday.

As noted yesterday, until the European Central Bank meeting on Thursday, the key indicators to watch are Italian and Spanish debt in the wake of the Summit. Thus far on Tuesday, both sovereigns have seen their short-term and long-term debt improve slightly further. The Italian 2-year note yield has fallen to 3.266% (-6.0-bps) while the Spanish 2-year note yield has fallen to 4.008% (-4.3-bps). The Italian 10-year note yield has fallen to 5.660% (-4.8-bps) while the Spanish 10-year note yield has fallen to 6.258% (-4.3-bps). As always, lower yields imply higher prices.

RELATIVE PERFORMANCE (versus USD): 10:42 GMT

CAD: +0.16%
AUD: +0.09%
EUR: +0.01%
CHF: -0.04%
GBP: -0.10%
NZD: -0.17%
JPY: -0.39%
Dow Jones FXCM Dollar Index (Ticker: USDOLLAR): +0.08%

ECONOMIC CALENDAR

An overall quiet session in New York coming up, with no data out of Europe expected the rest of the day. Of interest: the Factory Orders report for May (14:00 GMT / 10:00 EDT), in which domestic manufacturers are expected to show a slight increase in activity. However, we could see a surprise here, given the divergence between recent Durable Goods Orders and the ISM Manufacturing report.

TECHNICAL OUTLOOK

EURUSD: The EURUSD’s consolidation and failure to set fresh highs in the wake of the Euro-zone Summit play into the budding Symmetrical Triangle on the daily chart. For now, we are looking for a pullback towards 1.2480 before the direction of the triangle is determined. Resistance to the upside comes in at 1.2700/15 (Bollinger Band, 50-DMA), and a break above suggests a test of 1.2745/50 (June high) then 1.2820. Triangle support comes in at 1.2480, and a move lower points to 1.2405/20.

USDJPY: The USDJPY is working on an Inverted Head & Shoulders pattern off of the June 1 low, with the neckline coming in at 80.60/70. Only a daily close above this level will signal the commencement of this pattern. With the Head at 77.60/70, this suggests a measured move towards 83.60/70 once initiated. Near-term support comes in at 78.85/90 (200-DMA). Price action to remain range bound as long as advances are capped by 80.60/70.

GBPUSD: The GBPUSD remains constructive in the near-term but advances look to be capped by the confluence of key moving averages around 1.5750. Furthermore, a retest of 1.5775/80 when considered in context of the moving averages in the area should see some sellers return to the market. Advances should be capped by 1.5745/50 (200-DMA) and then 1.5775/85 (June high, 50-DMA). Support comes in at 1.5595/1.5600 then 1.5480/1.5500.

AUDUSD: While our fundamental outlook for the AUDUSD is bearish long-term, we respect the recent rally off of the June 1 low and identify the move as impulsive (we can identify 5 waves up from the June 1 low). With that said, this advance thus appears to be in its final stages, and the confluence of resistance in close proximity to current price should hinder gains. 1.0265/90 (Bollinger Bank, 100-DMA) should attract sellers as should the budding RSI divergence on the 4-hour charts. Price remains supported above 1.0125.

Devon’s finest Charlotte Holmes crowned as Miss England 2012

2012-07-03T06:23:00.001-07:00

Anyone who has had the pleasure of spooning an entire tin of Ambrosia custard into their gobs, or has seen the natural beauty of Dartmoor, will know that Devon is a pretty special county.

And so it will probably come as little surprise to learn that Charlotte Holmes, aka Miss Devon, has been crowned Miss England 2012.

The Devonian was one of 60 of the nation’s most beautiful women who gathered in Leicester this week to battle it out for the illustrious title

Holmes – a former contestant on Britain’s Next Top Model – faced stiff competition in the shape of runners up Anastasia Smith (Miss North Yorkshire) and Tamzin Cummings (Sunderland People’s Choice), but eventually came out on top.

The 23-year-old beauty queen won herself a trip to Mauritius, as well as the chance to represent England at the Miss World final in August.

English rose Holmes was overjoyed when judges announced her victory, but she managed to utter a few words through her tears of joy. She said: “I am so happy to have won the crown and my ambition is to give young girls the message they can achieve.”

So girls of England take heed: if you’re incredibly bloody attractive, then one day you too could follow in Holmes’ sexy footsteps..

Syria-Turkey tension: Assad 'regrets' F-4 jet's downing

2012-07-03T06:12:00.001-07:00

Syria-Turkey tension: Assad 'regrets' F-4 jet's downing

Syrian President Bashar al-Assad is quoted as saying he regrets "100%" that a Turkish jet was shot down after entering Syrian airspace.

In an interview with Turkey's Cumhuriyet newspaper, he argues that the plane was flying in an area previously used by Israel's air force.

The plane went down in the Mediterranean last month and the two pilots have not been found.

The incident has heightened tensions between the two countries.

Last week, Turkish PM Recep Tayyip Erdogan condemned Syria's action and described the neighbouring country as a "clear and present threat".

Turkey's border areas were reinforced with rocket-launchers and anti-aircraft guns on Friday.

It has also emerged that the Turkish air force scrambled fighter jets on three consecutive days after Syrian helicopters were said to have approached the border.

In his Turkish interview, Mr Assad appears to try to cool the dispute, saying Syria had not and would not bolster its military presence, regardless of the actions of Mr Erdogan's government.

"We will not allow (the shooting down) to turn into open combat between the two countries," President Assad is quoted as saying.

In other developments:

Turkish media reported late on Monday that another 85 Syrian soldiers, including 14 senior officers, had defected across the Turkish border. It is one of the biggest groups of army defections since the March 2011 uprising in Syria began
Syria is practising a widespread policy of state-sanctioned torture with an "archipelago of torture centres", a Human Rights Watch report says
UN human rights chief Navi Pillay has said that both Syrian government forces and the opposition have been involved in operations that harmed civilians
At least 78 people were killed in violence throughout Syria on Monday, opposition activists reported
Clashes were reported on Tuesday in suburbs of Damascus and government forces were operating in the cities of Deraa and Deir al-Zour, the Local Co-ordination Committees (LCC) activist group said
UN observers visited the Damascus suburb of Douma on Tuesday, after it was recaptured days earlier by government forces
A picture released by activists purportedly showed the burial of more than a dozen people killed by Syrian forces in Douma

Cumhuriyet says that during its interview - carried out over two-and-a-half hours in Damascus on Sunday by Ankara bureau chief Utku Cakirozer - the Syrian leader was adamant that the plane's identity had become clear only after it was brought down.

"We want to think of it as a pilot's error and we would consider this an isolated incident," he is reported as saying. "I say 100% 'if only we had not shot it down'."

The soldier who opened fire on the F-4 Phantom had no access to radar, he says, pointing out that the same route was used in the 2007 Israeli bombing of a site in north-eastern Syria.

The UN's nuclear agency later said the site was very likely a nuclear reactor under construction.

Barclays boss Bob Diamond resigns amid Libor scandal

2012-07-03T06:09:00.000-07:00

Barclays boss Bob Diamond resigns amid Libor scandal

Barclays chief executive Bob Diamond has resigned with immediate effect.

The move comes less than a week after the bank was fined for trying to manipulate inter-bank lending rates, sparking a government inquiry and calls for criminal investigations.

Mr Diamond said he was stepping down because the external pressure on the bank risked "damaging the franchise".

BBC business editor Robert Peston said the Barclays boss was encouraged to go by the Bank of England and the FSA.

"They were unable to force him out," our correspondent says, "because the recent FSA investigation into how Barclays attempted to rig the important Libor interest rates did not find him personally culpable."

"However, as a regulated institution, it was impossible for Barclays' board to ignore the revealed wishes of the two most powerful regulators in the City."

Earlier, Lord Turner, the chairman of the Financial Services Authority, described the outrage that has built up over the bank's actions.

"The cynical greed of traders asking their colleagues to falsify their Libor submissions so that they could make bigger profits - has justifiably shocked and angered people, in particular when we are facing hard economic times provoked by the financial crisis," he told the Financial Services Authority's annual meeting.

Committee appearance

Barclays chairman Marcus Agius, who had announced his own resignation on Monday, will now take over the running of Barclays until a new chief executive is appointed.

The bank refused to comment on reports that chief operating officer Jerry del Missier, one of the executives to give up his bonus after Barclays received a record fine for Libor manipulation last week, was also planning to step down.

Mr Diamond will still appear before MPs on the Treasury Committee on Wednesday to answer questions about the Libor affair.

"I look forward to fulfilling my obligation to contribute to the Treasury Committee's enquiries related to the settlements that Barclays announced last week without my leadership in question," Mr Diamond said in a statement.

Chancellor George Osborne welcomed Mr Diamond's departure and said he hoped it was the "first step towards a new culture of responsibility" in banking.

"It is the right decision for the country," Mr Osborne said, saying the UK needed a strong Barclays concentrating on lending and contributing to economic recovery.

Labour leader Ed Miliband said it was "necessary and right" that Bob Diamond stepped down.

"But this is about much more than one individual, it's about the culture and practices of the banking industry," he said.

"That's why we need a full, judge-led, independent inquiry, to get to the bottom of those practices and make recommendations for change in the future. We've had missed opportunities before, we've got to seize this moment."

Labour is critical of the government's decision to call a parliamentary inquiry, chaired by the head of the Treasury Committee, Andrew Tyrie MP, rather than a full Leveson-style inquiry, independent of politicians.

Big pay-off?

Last week, regulators in the US and UK fined Barclays £290m ($450m) for attempting to rig Libor and Euribor, the interest rates at which banks lend to each other, which underpin trillions of pounds worth of financial transactions.

Staff did this over a number of years, trying to raise them for profit and then, during the financial crisis, lowering them to hide the level to which Barclays was under financial stress.

Mr Diamond is one of the UK's highest paid chief executives, earning £20m last year, and was described as "the unacceptable face" of banking by the then business secretary Lord Mandelson in 2010.

The details of any severance package are not yet known, but former City minister Lord Myners suggests it could add up to £20m-£30m.

"I think his resignation letter is drafted with an eye to that [pay-off], because he admits no guilt on his part at all," the Labour peer told BBC News.

"The shareholders of Barclays will be expecting the board to ensure that not a penny more is paid to Bob Diamond than that to which he is legally entitled," he said.

US-born Mr Diamond was head of Barclays Capital, its investment bank division, when its staff were trying to manipulate the key inter-bank rates.

"He maintains that he didn't know what was going on," says Robert Peston.

It emerged over the weekend that Mr Diamond spoke to the deputy governor of the Bank of England Paul Tucker about Barclays' Libor submissions at the height of the credit crunch in 2008.

The details of that telephone conversation will be an important area of questioning at this week's hearing of the Treasury Committee.

Barclays' managers came to believe, after the conversation between Mr Diamond and Mr Tucker, that the Bank of England had sanctioned them to lie about what they were paying to borrow when providing data to the committees that set the Libor rate.

Investigations are continuing in the UK and the US into other banks over Libor fixing, including criminal investigations by the Department of Justice. The Serious Fraud Office in the UK is looking into possible criminal prosecutions.

BUBBLE ALERT: Posing In Playboy Helps Woman Launch Her Own Currency Brokerage

2012-06-06T07:36:00.001-07:00

Georgia Anderson, one of the women who posed in the May 2012 Playboy issue, the "Women of Wall Street" now runs an online brokerage.
For some reason Anderson is modest about her "Women of Wall Street" Playboy spread - she plays it down.

You want to know about the Playboy thing? Basically, I posed for Playboy for the Women of Wall Street and that was just something fun to do. I mean, I enjoyed the experience and everything, [but] it was not my job. Just a one-time experience that I've done.

But we're happy to brag about it for her.
Anderson's Playboy pose did nothing short of launch her a new career.
In fairness, she needed a new job after getting fired for posing in Playboy in the first place.
But as she points out, trading and nudity are not mutually-exclusive, they actually go very well together. And it was posing in Playboy's "Women of Wall Street" issue that first awakened in her the entrepreneurial spirit and the idea to marry the two together.

From [the Playboy thing] I get some media experience and I decided to start something. I also decided to combine the experience I had as a Futures and Forex broker.

Because when I was working and had so many clients to manage, I realized that all these people need to connect and communicate. They're always in front of their computers, and they need to have, at some point, a communication place.

That's why the site does that. We do blogs, we do technical analysis daily, we chart. Sometimes it's really about finance, sometimes we just make some jokes, to relax a little bit from the hard work.

Like Anderson says, the idea formed organically. There are a lot of guys in finance. Finance guys trade sometimes, but not all the time. Finance guys like girls in bikinis. Bingo!
Anderson's online "adult" brokerage is a perfect marriage for people like Big Joe in Paris, France, Jens Fisher, and Scott Benson, a trader who's uploaded topless shots of his own.
So it makes sense that there's a cleavage shot of Georgia on her website, she told Benzinga. Not because the Playboy thing was actually a two time thing, but because she can pose in a bikini and be taken seriously on the stock market.

[The industry I work in is] male-dominated, that's why on a bikini picture on my website. I proved my point, that a woman can be feminine and still work in finance and still have something to say. That's what I try to do.

Eurozone Needs Healthy “Proponomics” Application to Survive Crisis

2012-06-06T07:31:00.001-07:00

By DailyFX on Jun 6, 2012 01:27:22 GMT

By Joel Kruger, Technical Strategist for DailyFX.com

Markets finding some bids following excessive risk liquidation
Aussie growth data come in much better than expected
We introduce “Proponomics” – the economics of artificially propping economies
Eurozone must apply this strategy to prevent further collapse
ECB policy decision due later today; no rate change expected

It’s excellent to be back on the desk after some time off to enjoy my new baby boy.
Meanwhile, markets have settled following a wave of volatility resulting in broad based strength in the safe haven US Dollar and Yen. While there is still no clear resolution in place to deal with the Eurozone crisis, a simple need for some form of a technical bounce after some extreme moves is finally being recognized. At the same time, there are also some positives to talk about on the fundamental front, with the most recent much better than expected Aussie growth data perhaps helping to infuse a sense of confidence into the market place.
Broadly speaking, we contend that risk correlated assets could indeed find more demand over the coming weeks, even in the face of threats in the Eurozone and fear of contagion. Since the onset of the global crisis in 2008, there has been one constant that continues to support the markets at every step of misfortune, and that is the commitment by central banks and governments to step in and do whatever is necessary to prop the local economy. This approach of doing “whatever it takes” to prevent collapse and prop up struggling economies is a new form of economics that seems to be proving effective as evidenced by the ability for the US economy to slowly emerge from recession.
What better name for this form of economics then “proponomics,” the economics of pumping liquidity into the system to prevent collapse at all costs. The strategy doesn’t concern itself with longer-term threats to the local and global economy and instead focuses firmly on fixing the short-term problem. While it is clear that the risks to the longer-term economy are potentially exacerbated through the implementation of an artificial support to the economy, it is also true that inability to step in and deal with the short-term problem would be even worse than pumping the local economy with liquidity and keeping monetary policy ultra accommodative.
Right now, the short-term threat to the Eurozone economy is more significant than the longer-term one and proponomics seems to be the most effective strategy. It now looks as though Europe will need to step up on this front and overinflate its way through the turmoil in order to prevent what could be a very serious disaster. Therefore, if Eurozone officials can step up and offer some form of reassurance that they will do whatever necessary to keep the Eurozone intact, we feel the outlook will be brighter despite the many obstacles that will still need to be overcome. The European Central Bank is scheduled to meet later today and while no change is expected on rates, we view this as a formidable opportunity for Mr. Draghi to step up and provide the necessary reassurances to both the Eurozone and global economies.

EUR/USD: The market is in the process of correcting from some violently oversold levels after breaking to yearly lows just under 1.2300. While our overall outlook remains grossly bearish, from here, we still see room for short-term upside before a fresh lower top is sought out. Look for a close back above 1.2545 to open the door for acceleration into the 1.2800-1.3000 area, where fresh offers are likely to re-emerge.

USD/JPY: The latest setbacks have been rather intense, with the market collapsing through the 200-Day SMA before finally finding support by 77.65. We have since seen attempts at recovery and we contend that the market should continue to break higher, with sights ultimately set on a retest and break of the 2012 highs by 84.20 further up. However, at this point, we will need to see a break and close back above 80.00 to officially alleviate downside pressures and reaffirm bullish outlook.

GBP/USD: Daily studies are now well oversold and from here risks seem tilted to the upside to allow for a necessary short-term corrective bounce after setbacks stalled just shy of the 2012 lows from January. Look for a break and close back above 1.5440 to strengthen short-term bullish outlook, with acceleration then projected into the 1.5600-1.5800 area where a fresh lower top will be sought out in favor of underlying bear trend resumption.

USD/CHF: While we retain a broader bullish outlook for this pair, with the market seen establishing back above parity over the coming weeks, shorter-term risks are for more of a corrective pullback to allow for the market to establish a fresh higher low. As such, we see risks for weakness over the coming sessions towards the 0.9300-0.9500 area before the market looks to reassert its bullish momentum and broader uptrend.

— Written by Joel Kruger, Technical Currency Strategist
To contact Joel Kruger, email jskruger@dailyfx.com. Follow me on Twitter @JoelKruger
To be added to Joel Kruger’s distribution list, send an email with subject line “Distribution List” to jskruger@dailyfx.com

Gambling: Understanding the odds in numbers

2012-06-06T07:11:00.002-07:00

“The next best thing to gambling and winning is gambling and losing.” So said legendary gambler Nick “The Greek” Dandalos, and he would know. Over the course of his playing career he’s thought to have won and lost $500 million.
Gamblers and statisticians share a love of odds, though the stakes on the table couldn’t be more different between the two. But us statisticians are allowed to fantasise a little, so here’s a hypothetical challenge. Let’s say you fancied a Maserati costing $100,000, but sadly you only had a dollar, what form of gambling will give you the best chance of getting the sports car? I’ll even make it a little easier for you by giving you three choices – a punt on the lottery, a flutter on the horses or a spin on the roulette wheel.
While you think about this, you might be surprised to discover how far back our urge for gambling stretches. Devices that embody randomness have been used in leisure for at least 5,000 years. The ancient Egyptians, presumably when nothing good was on television, sat around and played board games in which moves were decided by throwing an astragalus, which is a bone in the heel that can land on one of four sides.
Gambling became so popular that the Romans tried to restrict it to Saturdays. Even the Emperor Claudius played obsessively and wrote a book called How to win at dice. People continued for centuries to make bets and quote odds: in Paris in 1588 you could get 5 to 1 against the Spanish Armada sailing to invade England, although this was probably a ruse by the Spanish.
Calculated risk
What is remarkable is that in all this time, right up until the Renaissance, nobody analysed gambles mathematically. This could be partly because people thought the outcomes were decided by some external force of fate, but it is now thought that the gap between theory and practice was too great, and therefore no-one had the idea of putting a number on chance - in other words calculate probability.
Not until the Chevalier de Mere, it seems. The Chevalier was a very perceptive gambler in Paris in the 1650s, and he reckoned that odds were slightly in his favour of getting a six in four throws of a single dice, but that the odds were slightly against him of throwing two dice and getting a double 6 in 24 throws. By chance (or fate) he brought the problem to two of the smartest mathematicians at that or any other time, Blaise Pascal and Pierre de Fermat. They confirmed that he had a 52% chance of winning the first bet, and a 49% chance of winning the second, so the Chevalier had got it right from what must have been very extensive and expensive experience.
The Chevalier also presented the mathematicians with the ‘problem of points’ – if a game has to stop before the end, in what proportions should the stake be divided up? A modern counterpart is the Duckworth-Lewis method in cricket, used for allocating runs scored by a team when a match is stopped by the weather – which in England is pretty much all the time. If you thought the game of cricket is difficult to understand, the Duckworth-Lewis method is almost totally incomprehensible to even the most ardent fan. No surprise, then, to hear that statisticians designed it.
After the Chevalier’s time the scientific assessment of odds disappeared for a few centuries, as the 1700s became a golden age of betting on the basis of gut-feelings rather than calculations. It was the time of ‘eccentric wagers’, such as a large sum won by the Count de Buckeburg in 1735 for riding from London to York seated backwards on a horse.

ECB sees rising risks to eurozone economy

2012-06-06T06:58:00.003-07:00

ECB sees rising risks to eurozone economy

European Central Bank (ECB) president Mario Draghi has said risks to the eurozone economy have increased.

He warned of "heightened uncertainty weighing on confidence and sentiment".
Mr Draghi also said that some members of the ECB's council had voted to cut interest rates this month, although the consensus had been to leave rates unchanged at 1.0%.
Earlier, official figures confirmed that the eurozone recorded zero growth in the first three months of the year.
The ECB also released its latest quarterly economic forecasts of growth and inflation.
Its growth forecast for 2012 was unchanged at a range of between -0.5% and 0.3%.
There was some surprise among analysts that the growth forecast has not been cut.
The inflation forecast was narrowed from between 2.1% and 2.7% to between 2.3% and 2.5%.
Mr Draghi also announced an extension to banks' unlimited access to ECB loans until the end of 2012.
But he declined to extend another liquidity measure, saying: "It is not right for monetary policy to fill other institutions' lack of action".
He said there would be no repeat of the bank's huge programme of three-year loans, in which it injected 1 trillion euros into the financial system in February and December 2011.
Mr Draghi said that, despite the continuing crisis in the eurozone, there was no guarantee that it would be effective if the problems were due to government policy, rather than a lack of liquidity.
"Some of the problems in the euro area have nothing to do with monetary policy," he said.
The euro fell against the dollar during Mr Draghi's news conference, giving up its earlier gains, on the news that the decision to keep rates on hold had not been unanimous.
European stock markets also fell back, although they were still showing gains on the day.

Venus makes rare trek across Sun

2012-06-06T06:56:00.001-07:00

Planet Venus has put on a show for skywatchers by moving across the face of the Sun as viewed from Earth.

The transit was a very rare astronomical event that would not be seen again for another 105 years.
Observers in north and central America, and the northern-most parts of South America saw the event start just before local sunset.
The far northwest of America, the Arctic, the western Pacific, and east Asia witnessed the entire passage.
While the UK and the rest of Europe, the Middle East, and eastern Africa waited for local sunrise to try to see the closing stages of the transit.
Venus appeared as a small black dot moving slowly but surely across the solar disc. The traverse lasted more than six and a half hours.

Some of the best pictures of the event were provided by the US space agency's (Nasa) Solar Dynamics Observatory, which studies the Sun from a position 36,000km above the Earth.
"We get to see Venus in exquisite detail because of SDO's spatial resolution," said agency astrophysicist Dr Lika Guhathakurta.
"SDO is a very special observatory. It takes images that are about 10 times better than a high-definition TV and those images are acquired at a temporal cadence of one every 10 seconds. This is something we've never had before."
Many citizens keen to observe the transit first hand attended special events at universities and observatories where equipment for safe viewing had been set up.
In Hawaii, one of the best places to see the whole event, the university's Institute of Astronomy set up telescope stations on Waikiki beach.
"We've had 10 telescopes and the queues have been 10 deep to each telescope all day long," said the institute's Dr Roy Gal.

"It's a great opportunity to get people excited and teach them stuff. I was hoping for a big turn-out, and it's been fantastic," he told BBC News.
Joe Cali viewed the transit on the edge of the Outback in New South Wales, Australia, another ideal vantage point.
"It is exciting. It may look like just a black dot on the Sun but if you think about it, it's one of the few times you get to see a planet in motion," he said.
UK skywatchers had to deal with quite extensive cloud conditions across the country.
"We've had total cloud and rain," said Brian Sheen from the Roseland Observatory in Cornwall.
"But we've been improving our chances by connecting with the Shetland Islands and the people up there have done rather better than we have. We've been seeing the transit through [a feed] of one of their telescopes," he explained.
Scientists observed the transit to test ideas that will help them probe Earth-like planets elsewhere in the galaxy, and to learn more about Venus itself and its complex atmosphere.

As part of Horizon's Transit of Venus programme, science presenter Liz Bonnin explains what the transit of Venus is and why it is such a rare event

Venus transits occur four times in approximately 243 years; more precisely, they appear in pairs of events separated by about eight years and these pairs are separated by about 105 or 121 years.
The reason for the long intervals lies in the fact that the orbits of Venus and Earth do not lie in the same plane and a transit can only occur if both planets and the Sun are situated exactly on one line.
This has happened only seven times previously in the telescopic age: in 1631, 1639, 1761, 1769, 1874, 1882 and 2004.
The next pair will not now occur until 2117 and 2125.

The phenomenon has particular historical significance. The 17th- and 18th-Century transits were used by the astronomers of the day to work out fundamental facts about the Solar System.
Employing a method of triangulation (parallax), they were able to calculate the distance between the Earth and the Sun - the so-called astronomical unit (AU) - which we know today to be about 149.6 million km (or 93 million miles).
This allowed scientists to get their first real handle on the scale of things beyond Earth.

Spain: No request for bailout, says minister

2012-06-06T06:49:00.001-07:00

Luis de Guindos said no decision would be made until audits of the banks were completed, possibly by the end of June.
There have been reports in the last few days that Spain was seeking an immediate bailout from eurozone funds.
Mr de Guindos was speaking in Brussels, where proposals aiming to avoid taxpayers having to fund future bailouts of banks have been published.
An IMF audit of Spain's banks is due next week, with further independent reports completed about two weeks after, Mr de Guindos said.
"I have absolutely not discussed any intervention in Spain's banks today," Mr de Guindos told reporters on the sidelines of meetings in Brussels.
Asked if Spain was preparing a request for EU aid, he said: "We are not preparing anything... we have a road map."

The comments helped lift shares in Spain's leading companies by about 3% in morning trading on the Madrid stock exchange.

However, speculation remains that Spain's bank sector is too weak to escape an eventual bailout.
On Tuesday, Spain's finance minister said the credit markets were "effectively shut" to his country, inflaming worries that the country would be forced to join Greece, Portugal and Ireland and seek outside help.
Spain has to find at least 80bn euros ($100bn; £65bn) to strengthen its banks' capital buffers.
A key test will come on Thursday, with Spain due to auction up to 2bn euros of bonds.
'Urgency' Spain is keen to avoid having to ask for an European Union bailout as this would come with strict conditions.
It is instead seeking funds which could be injected directly into the banking system. Reports suggest EU officials are looking at how this could happen.
The deepening eurozone crisis was discussed by UK Prime Minister David Cameron and US President Barack Obama on the telephone last night.
Both leaders urged "immediate action" to tackle the crisis and restore market confidence.
The prime minister is due to meet Chancellor Angela Merkel on Thursday to discuss the issues.
No 10 played down any suggestion of a rift with Mrs Merkel over the need for action, saying: "All leaders in the eurozone understand the need for urgency."
'Serious situation' On Wednesday, the European Commission unveiled proposals designed to stop taxpayers' money being used to bail out failed banks.

The aim is to ensure losses are borne by bank shareholders and creditors and minimise costs for taxpayers.

However, new legislation is unlikely to come into force before 2014 at the earliest, too late to protect taxpayers from any further immediate bank failures.
"The proposal we have today may be only useful for the future but it does not solve the current problems we face," said Sharon Bowles, chair of the European Parliament's economic and finance committee.
"In the short term we need further measures," she said.
Stefaan de Rynck, a spokesman for Michel Barnier, the EU's top regulatory official who outlined the banking plans, said: "We are faced with a serious situation today, but that does not stop us thinking about the future, and from us developing a vision about the future.
"Our proposal today puts a key element on the table."
There would be new requirements for countries to prepare for a bank collapse, collecting money through an annual levy on banks that would be used to provide emergency loans or guarantees.
The new arrangements would allow authorities to reduce the claims of unsecured creditors, meaning that shareholders and creditors bear the losses, not governments and the taxpayers that support them.
The European Commission plans involve drawing up a EU-wide framework that would allow:

Financial regulators to be more "intrusive" in the running of banks as firms' stability worsens
Forcing banks to draw up explicit "recovery" and "resolution" plans in the event of their finances deteriorating
Countries to enforce the sale of all or a part of failed banks, overriding the rights of shareholders or creditors
Appointment of a "special manager" at a bank to "restore its financial situation"
Lays the foundations for an "increasingly integrated EU-level oversight of cross-border entities"

The changes form part of commitments agreed by the leaders of the G20 group of major economies in September 2009.
Mr Barnier said: "The financial crisis has cost taxpayers a lot of money. Today's proposal is the final measure in fulfilling our G20 commitments for better financial regulation.
"We must equip public authorities so that they can deal adequately with future bank crises. Otherwise citizens will once again be left to pay the bill, while the rescued banks continue as before knowing that they will be bailed out again."
If it wins the backing of EU countries and the European parliament, the law would mark a step in the direction of the banking union supported by European Central Bank president Mario Draghi.

Pound Falls Towards January Lows Following Weak UK Manufacturing

2012-06-03T10:47:00.002-07:00

THE TAKEAWAY: UK PMI manufacturing falls to an unexpected 45.9 -> Manufacturing sector sees first job losses in five month -> Cable nearing January low
UK manufacturing slowed at the fastest pace since March 2009. Scaled back production and low employment led to a drop in the UK Purchasing Manager’s Index for manufacturing to 45.9 during the month of May. The index contracted from last month’s revised 50.2, according to Markit Economics, and disappointed expectations for 49.7. A reading below 50 shows a slowdown in manufacturing.
Markit Economics reported that the weakness in manufacturing resulted from worsening economic conditions and a subdued domestic market. Manufacturing production would have been worse if not for a backlog of existing contracts that needed completing. New export orders also fell for the second month in a row and the industry also reported job losses for the first time in five months during May.
Earlier today, the British Chambers of Commerce lowered its projected growth for the UK economy from 0.6% to 0.1% for 2012, the BCC also sees a 1.9% growth in 2013. Both the BCC and IMF are calling for increased stimulus to try and fight the effects of the euro-area crisis and keep Britain’s AAA rating.

Big powers jockey in the Pacific

2012-06-03T10:44:00.004-07:00

The US has been, is, and will continue to be a Pacific power. That was the fundamental message the US Defense Secretary Leon Panetta brought to this year's Asian security summit in Singapore.

Mr Panetta then headed off to Vietnam and India - two stops that highlight, in their different ways, two aspects of Washington's new security relationships in the Asia-Pacific region.
The Obama Administration having announced the so-called "pivot" back to Asia at the start of the year, it was left to Mr Panetta to fill in some of the blanks and to try to convince Washington's friends and allies that at a time of severe financial austerity the US has the means to fund its Asia-Pacific ambitions.
The rhetoric was flowing. "The US", said Mr Panetta, was "at a strategic turning point after a decade of war".
And he went on to detail some of the "re-balancing" in America's defence posture - the new term now preferred to "pivot" - that the new strategy requires.
He said that by 2020 some 60% of the US Navy would be deployed in the Pacific as opposed to about 50% today. This will include six aircraft carriers and the majority of the US Navy's cruisers, destroyers, Littoral Combat Ships and submarines.
He spoke of energising alliances and partnerships, noting the rotational deployment of US Marines and aircraft to Australia.
A host of bilateral meetings in the margins of the summit also produced results. Singapore, for example, agreed to the forward-basing of four of the US Navy's new Littoral Combat Ships - small, high-tech vessels suited to maintaining a presence in the region.
But among many participants there were still concerns about the US administration's ability to fund its resurgent Asia-Pacific ambitions. Words like agile, leaner, and so on essentially translate to fewer but more capable warships.

The veteran Republican Senator John McCain, while welcoming Mr Panetta's comments, told me he was seriously worried by the spectre of draconian cuts in the US defence budget.
Ship numbers matter, he said, and the decline in the size of the US fleet, he argued, might mean that it was not able to carry out all of the missions set out by the defence secretary.
The view from Beijing For all the talk of maritime free passage, the importance of vital sea lanes for prosperity and so on, the ghost at the feast was China.
While Mr Panetta and many other speakers stressed that the US presence and the modernisation of local defence capabilities should not be seen as directed against or intended to constrain China, it is far from clear that this is the way things are viewed in Beijing.
China was at the summit - a small clutch of uniformed officers listened intently to Mr Panetta's speech. Chinese attendance at the Shangri-La Dialogue, as the annual summit is also called, has developed to the point that last year Chinese Defence Minister Liang Guanglie represented his country.

Continue reading the main story

“Start Quote

Improved military capabilities can be a two-edged sword, a threat as much as a defence”

This year, though, it was a lower-ranking officer who headed the Chinese delegation.

China-watchers here say that political uncertainties in Beijing and the ramifications of a scandal involving former top leader Bo Xilai have constrained key individuals from travelling. I understand from the conference organisers that the Chinese have assured them that next year it will be business as usual, and that no snub was intended.
China's future remains the central strategic question. Mr Panetta urged Beijing to back a rules-based system to decide competing territorial claims in the South China Sea.
But how far is Beijing prepared to go down this path, given the expansive scope of its claims and its clear determination to develop the naval muscle to back them up?
Arms race?
The Asia-Pacific region is clearly big enough for two major strategic players - the US and China. But as each appears to develop forces to counter the other, at what point does this strategic competition turn into a self-fulfilling prophecy of open competition?
Unease at China's military rise, as well as local problems like piracy and terrorism, are fuelling an arms race of sorts in the region which again, potentially could have its dangers. One of the most interesting sessions at the conference dealt with the proliferation of submarines.

As Christian Le Miere of London's International Institute for Strategic Studies told me, Singapore and Malaysia have taken delivery of new submarines in recent years, and Vietnam and Indonesia have new boats on order. One senior officer said that there would be up to 170 submarines in the Pacific region by 2025.
Submarines are attractive given their stealthy characteristics, their ability to operate unseen and unsupported, at least in uncontested areas. They can be used for a variety of missions including maritime patrols, reconnaissance gathering, the landing of special forces and so on.
The spread of submarines inevitably prompts the purchase of more; another submarine is the best anti-submarine weapon. But more capable anti-submarine surface vessels and maritime patrol aircraft are also being bought.
It is perhaps too early to speak of an arms race in the region but this competitive modernisation raises some concerns.
Many conference participants called for greater transparency in the use and operation of submarines (something of a contradiction, surely, given their stealthy characteristics.) This would help to reduce the chances of submarines becoming a destabilising force.
On a visit to the main Singapore Navy command centre at Changi, I saw one small first step in this process - a multinational submarine rescue course was underway. But clearly this is an issue that will require a lot more attention in the future.
Prosperity, a rising China, the importance of trade routes and maritime tensions are all driving the process of modernisation. But improved military capabilities can be a two-edged sword, a threat as much as a defence.
This is a region where the security architecture is beginning to develop to try to meet these threats both through informal events like the Shangri-La Dialogue - one of the key drivers of multilateral defence contacts - and increasingly through more formal mechanisms like Asean Plus, that brings together the defence ministers of the Association of South East Asian Nations along with key partner countries.

Japan 'doomsday cult member' held

2012-06-03T10:42:00.001-07:00

A woman who may be a Japanese cult member wanted over the deadly 1995 gas attacks on the Tokyo subway has been arrested, Japanese media say.

They say Naoko Kikuchi, a 40-year-old ex-member of the Aum Shinrikyo doomsday cult, was picked up in Sagamihara, west of Tokyo, on Sunday.
Police said they could not confirm the reports.
Ms Kikuchi is one of two Aum Shinrikyo members still at large. Twelve people died in the 1995 Tokyo attacks.
Hundreds of others were injured when the cult released sarin nerve gas on several trains during rush hour.
On New Year's Eve another former member of Aum Shinrikyo, Makoto Hirata, turned himself in to police after nearly 17 years on the run.
Nearly 200 Aum Shinrikyo members have been convicted in connection with the sarin attack and other crimes. Thirteen are awaiting execution.
Aum Shinrikyo began as a spiritual group mixing Hindu and Buddhist beliefs in the 1980s, but developed into a paranoid cult obsessed with Armageddon.
Cult leader Shoko Asahara is among those on death row.
Aum Shinrikyo reinvented itself as the Aleph group, which continues to operate as a spiritual group.

Syria crisis: Assad denies role in Houla massacre

2012-06-03T10:41:00.001-07:00

Syria's President Bashar al-Assad has denied his government's forces had any role in the Houla massacre.

More than 100 people, many of them children, were killed in the attack overnight between 25 and 26 May, most knifed or shot at close range.
Mr Assad described the killings as an "ugly crime" that even "monsters" would not carry out.
Addressing parliament, he blamed "foreign meddling" for Syria's divisions.
"What happened in Houla and elsewhere (in Syria) are brutal massacres which even monsters would not have carried out," he said in the televised address.
"If we don't feel the pain the pain that squeezes our hearts, as I felt it, for the cruel scenes - especially the children - then we are not human beings," he said.
UN investigators have said most of the dead were summarily executed, and eyewitnesses had said pro-government militias had carried out most of the killings.
The massacre has triggered international condemnation and led to several countries expelling Syrian diplomats in protest.

Mr Assad again blamed "terrorists", supported by foreign powers, for fomenting discord and creating "a project of... dissent" inside the country.

He said Syria was "facing attempts to weaken Syria, breach its sovereignty".
The only way to resolve the crisis, he said, was through political dialogue. But he said he would not negotiate with those who, he said, did not represent the will of the Syrian people.
The international peace envoy Kofi Annan, sent by the United Nations and the Arab League, expressed frustration on Saturday that Mr Assad was not turning his words into actions.
He said the Syrian president "must make bold and visible steps immediately to radically change his military posture and honour his commitment to withdraw heavy weapons and cease all violence".
Violence continued on Saturday in Syria where, according to the UK-based Syrian Observatory for Human Rights quoted by Agence France Presse, 89 people, including 57 soldiers were killed.
If confirmed, it would be the largest number of casualties the military has suffered in a single day since the uprising began in March 2011.

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Diamond Jubilee Thames Pageant cheered by crowds

2012-06-03T10:40:00.000-07:00

More than one million rain-soaked people have watched the Queen's 1,000-boat Diamond Jubilee pageant weave its way along the Thames, organisers say.

The Queen travelled at the heart of the flotilla of tugs, steamers, pleasure cruisers, dragon boats and kayaks.
The event was the highlight of the Jubilee weekend, but a fly-past has been cancelled because of the weather.
Some 10,000 people joined a Greenwich street party, one of many in the UK marking 60 years of the Queen's reign.
The river event officially started with the ringing of Jubilee bells at 14:40 BST and ended when the last vessel completed the seven-mile route from Albert Bridge to Tower Bridge just after 18:00 BST.
The Queen, dressed in a white hat and a silver and white coat designed by Angela Kelly, was taken to her barge on the launch of the now-decommissioned Royal Yacht Britannia after being greeted by a spontaneous rendition of the national anthem from the crowds.
'Amazing day' She was accompanied by senior royals, including the Duke of Edinburgh and the Duke and Duchess of Cambridge, on the barge, which was decorated with 10,000 flowers from the royal estates.

Some 20,000 people were thought to have been in the boats of the flotilla, which travelled at 4 knots (4.6 miles) an hour, with the Thames barrier closed to slow the river's flow.

The Spirit of Chartwell left Cadogan Pier once the rowing boats in the flotilla had safely passed. Leading the rowing boats was the million-pound row barge Gloriana, with Olympic gold medallists Sir Matthew Pinsent and Sir Steve Redgrave among the 18 rowers.
A huge cheer went up whenever the royal barge came into sight of the crowds. Hungarian Laura Konig, 34, who lives in the London borough of Sutton, said: "I really enjoy the music, when the boats with bands come by it's brilliant and the atmosphere is so cool. The weather could be better but apart from that it's an amazing day."
A boat carrying eight specially cast Jubilee bells led the water-borne procession, and churches along the river bank were returning the peal as it passed. There were 10 musical barges, carrying choirs and orchestras.
A collection of small ships used to rescue stranded troops from the beaches of Dunkirk in 1940 also took part, led by the Motor Torpedo boat 102, the flagship of the officer who co-ordinated the evacuation.
The Queen smiled at the sight of a life-size puppet horse - from the play War Horse - which was running along the roof top of the Royal Festival Hall. The Queen pointed out the performance to Camilla.
Dozens of spectators at Tower Bridge were disappointed as security staff blocked off pathways due to fears of overcrowding, more than an hour before the flotilla was due to arrive.

Surprise royal guests join Diamond Jubilee street party

Those who were able to claim a spot on the river were delighted when they could hear the bells shouting "it's happening!" and lifting up little children to see the sight.
Tower Bridge raised as the royal barge approached, with heavy rain returning to the London skies as it moored to allow the Queen to watch the rest of the flotilla pass.
The Guinness World Records said the pageant had set a new world record for the largest parade of boats, surpassing the previous record of 327 in Bremerhaven, Germany, last year.
BBC Big Screens transmitted live coverage of the pageant in 22 locations around the UK including Belfast, Cardiff, Edinburgh, Birmingham, Bristol, Leeds, Liverpool, Manchester and Middlesbrough.
Prime Minister David Cameron paid tribute to the 86-year-old Queen during an interview on BBC One's Andrew Marr programme earlier, saying: "Her insight and her sharpness is extraordinary and I don't see any sign of her working less hard." But his own Jubilee party in Downing Street was moved indoors because of the weather.
In Piccadilly, central London, the BBC's Sangita Myska said there was a "huge crush" as well-wishers flocked to greet a surprise visit by the Duke and Duchess of Cornwall to a street party where 500 tables had been set up.
In other news:

EUR/USD Confirmed Bearish Breakout; 2008 Low 1.2330 in Sight

2012-05-30T07:18:00.002-07:00

Previous: EUR/USD – Waiting for Breakout From Consolidation Range (5/28)
EUR/USD Chart 1H 5/30/2012 6:43AM EDT

The breakout from consolidation came with a break below 1.25 in the 5/29 US session. Then there was a end-of-session pullback to 1.25 with bears standing ground. After this picture-perfect breakout confirmation, the market fell lower throughout the 5/30 Asian and European session now trading just below 1.2450 as we gear up for the US session.
While a conventional range breakout projection targets the 1.2390-1.24 level. The breakout really opens up the 2008 low at 1.2330. We might anticipate some consolidation, or correction at levels around the 2008-low, but there is still downside risk toward the psych level of 1.20 and the 2010-low near 1.19.
Spanish 10-yr yield continued to rise, now at 6.6. Manwhile the Spanish/German 10-yr bond yield spread also widened to 535 from 523 as this number continues to push above record levels. Italian auction did not raise the target of 6.25bn euros in its 5-yr and 10-yr government bond auction. (raised 5.73bn euros)
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Information and opinions contained in this report are for educational purposes only and do not constitute an investment advice. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness. FXTimes will not accept liability for any loss of profit or damage which may arise directly, indirectly or consequently from use of or reliance on the trading set-ups or any accompanying chart analysis.

Euro Drops to New 2-Year Lows Following Weak Economic Sentiment

2012-05-30T07:14:00.000-07:00

THE TAKEAWAY: Eurozone economic sentiment falls to 2.5 year low -> Bank of Spain governor resigns -> Euro hits two year lows

Eurozone economic sentiment dropped to a two and a half year low, as the measure for May came in at 90.6, much lower than the expected 91.9, and a 2.3 point drop from April’s revised sentiment. Consumer confidence rose in the Eurozone to -19.3 as expected, compared to -19.9 in April.
Last week, the economic confidence for the entire European Union was reported as falling by 2.7 points during May to 90.5, as reported by the European Commission.
The economic sentiment dropped in Italy by -4.3, in France by -1.5, and even in the uniquely economically stable Germany by -1.4. Industry confidence deteriorated by -2.3 in the Eurozone based on lower managers’ assessments of their companies’ current levels of order books as well as lowered production expectations.
Consumer confidence rose during May on improved expectations for the general economic situation and less unemployment fears.
The data comes at the end of a month that has been packed with economic worry over the heightened prospect of Greece leaving the euro by year’s end. The market showed further fear today following the resignation of Bank of Spain Governor Miguel Angel Fernandez Ordonez. Ordonez was facing criticisms for nationalizing the struggling Bankia group, and following the resignation news, the Euro dropped and Spanish 5-year bonds yields rose to record 6% highs.

EUR/USD continued its decline to new 2-year lows following the news; seemingly less moved by the data itself and more affected by the general sense of fear around the Spanish bank crisis.

Obama honours 13 with Medal of Freedom at White House

2012-05-30T07:07:00.001-07:00

President Barack Obama has bestowed the nation's highest civilian honour on political and cultural figures in a ceremony at the White House.

Musician Bob Dylan, astronaut John Glenn, and Israeli President Shimon Peres were among the Medal of Freedom recipients.
The award is given to people from all walks of life who have made exceptional contributions to society.
It was established by former President John F Kennedy in 1963.
Dylan was born Robert Allen Zimmerman on 24 May 1941 and began his musical career in 1959, playing in Minnesota coffee houses.
He took his stage name from the poet Dylan Thomas and, not coincidentally, paid as much attention to his lyrics as his music.
Much of his best-known work dates from the 1960s, when he became an informal historian of America's troubles.
Songs such as Blowin' In The Wind and The Times They Are a-Changin' became anthems of the anti-war and civil rights movements.
His move away from traditional folk songwriting, paired with a controversial decision to "go electric", proved equally influential - his confessional, introspective lyrics were undoubtedly absorbed by The Beatles in their later work.
He continues to record and tour, expanding his horizons with a US radio show and a recently signed six-book publishing deal.
'Beloved' Another luminary to be awarded the honour, Toni Morrison, is renowned for her portrayal of the African-American experience in novels such as Song Of Solomon, and Beloved, which won the Pulitzer Prize in 1988.
Born Chloe Anthony Wofford in 1931 in Ohio, she went on to become a senior editor at publishers Random House before pursuing her writing career.

Outside of novels, she has written literary criticism and even lyrics for operas, including Honey and Rue, with music by Andre Previn.
Once asked by a student who she wrote for, Morrison replied: "I want to write for people like me, which is to say black people, curious people, demanding people...
"People who can't be faked, people who don't need to be patronised, people who have very, very high criteria."
The 13 people awarded the Medal of Freedom at Tuesday's ceremony in the East Room of the White House included:

Madeleine Albright, secretary of state from 1997 to 2001 and the first woman to hold that post
John Doar, assistant attorney general in charge of civil rights at the Department of Justice during the 1960s
William Foege, physician and former director of the Centers for Disease Control and Prevention, who led the campaign to eradicate smallpox
Gordon Hirabayashi, who fought the internment of Japanese-Americans during World War II and died in January
Dolores Huerta, community activist and co-founder of the National Farmworkers Association in 1962
Jan Karski, officer in the Polish Underground in World War II and later a professor at Georgetown University's School of Foreign Service, who died in 2000
Juliette Gordon Low, founder of the Girl Scouts in 1912, who died in 1927
John Paul Stevens, associate justice of the US Supreme Court from 1975 to 2010
Pat Summitt, basketball coach who has won more games than any other coach, and spokeswoman against Alzheimer's disease

Previous honourees include Mother Teresa, Margaret Thatcher, Stephen Hawking, Walt Disney, Doris Day, Duke Ellington and Aretha Franklin.

Russia 'categorically against' Syria intervention

2012-05-30T07:03:00.001-07:00

Russia is "categorically against" foreign intervention in Syria and believes any new steps by the UN Security Council would be "premature", its deputy foreign minister has said.

Russia wields a veto at the UN Security Council and the remarks are a blow to hopes of a fresh initiative there.
International outrage has been expressed at the massacre of 108 people - mostly women and children - in Houla.
Neighbouring Turkey is expelling all Syrian diplomatic staff in Ankara.
The move goes further than the co-ordinated action by a number of other countries, which restricted their expulsions to the most senior staff, although Syrian consular staff in Istanbul will remain.
Turkey's foreign ministry said it was "out of the question to remain silent".
In apparent retaliation for the diplomatic expulsions, Syria gave the Dutch charge d'affaires - one of the few remaining top-level Western diplomatic representatives in Damascus - 72 hours to leave.
The violence in Syria is continuing, with the head of the UN observer mission there saying 13 bodies have been discovered in al-Sukar, east of the city of Deir al-Zour, with their hands tied behind their backs and signs that some had been shot in the head from close range.
Norwegian Maj Gen Robert Mood said he was "deeply disturbed by this appalling and inexcusable act".
'Turning point' China and Russia have previously blocked two UN Security Council resolutions calling for tougher action on Damascus.
On Tuesday, French President Francois Hollande said military intervention authorised by the Security Council had not yet been ruled out.

The US state department meanwhile expressed hope that the events in Houla might prove a "turning point in Russian thinking".
And Israel's Defence Minister Ehud Barak said the massacre should "compel the world to take action - not just talk, but action".
But on Wednesday Russia appeared to rule out a shift in stance.
"We have always said that we are categorically against any outside interference in the Syrian conflict because this will only exacerbate the situation for both Syria and the region as a whole," Deputy Foreign Minister Gennady Gatilov told Interfax news agency.
A spokesman for China's foreign ministry also reiterated Beijing's opposition to military intervention in Syria or forced "regime change".
Moscow's stance was condemned by the main Syrian opposition group, the Syrian National Council, which said Russia had chosen "to join ranks with the Syrian regime and to provide it with political cover", AFP news agency reported.
Aside from the discovery of the bodies in Deir al-Zour, Syrian activists said at least nine people had died on Wednesday.
There were reports of shelling by security forces in Homs and villages nearby.
Overnight, activists said five people were killed by shells and gunfire in Douma, a Damascus suburb.
'Bloodshed and division' Troops, tanks and artillery were all supposed to have been withdrawn to barracks in April as the first step on the ground under six-point peace plan of UN and Arab League envoy Kofi Annan.
But it simply has not happened, says the BBC's Jim Muir in neighbouring Lebanon.

Amid the reports of continuing violence, it appears Mr Annan's talks with President Bashar al-Assad and opposition figures in Damascus on Tuesday have had no immediate impact on the ground.

Mr Annan's deputy, Jean-Marie Guehenno, is due to report to the UN Security Council on Wednesday on the talks with Mr Assad.
Tuesday's co-ordinated action saw the US, UK, France, Germany, Spain, Italy, Australia, Switzerland, the Netherlands, Belgium, Canada, Japan and Turkey either expel Syrian ambassadors and officials or declare them a "persona non grata".
Turkey warned it could follow the expulsions with additional measures if Damascus did not change course, though it did not elaborate.
Syria's state-run media has denounced the expulsions as "unprecedented hysteria", while Russia called them a "counterproductive step".
Forty-nine children and 34 women were among those killed in Houla last Friday and Saturday.
Witnesses have told the UN the vast majority of killings were committed by pro-government shabiha militiamen.
The UN Human Rights Council will hold a special session on Syria on Friday looking into the killings, officials said.

Are you in Houla, or elsewhere in Syria? Have you been affected by the recent violence? Send us your comments using the form below.

Liberia ex-leader Charles Taylor get 50 years in jail

2012-05-30T07:01:00.002-07:00

Liberia's ex-President Charles Taylor has been sentenced to 50 years in jail by a UN-backed war crimes court.

Last month Taylor was found guilty of aiding and abetting rebels in Sierra Leone during the 1991-2002 civil war.
Special Court for Sierra Leone judges said the sentence reflected his status as head of state at the time and his betrayal of public trust.
Taylor, 64, insists he is innocent and his lawyer has told the BBC he will appeal against the sentence.
"The 50-year sentence pronounced today effectively is a life sentence for someone that age - the rules of the court prohibit expressly the imposition of a life sentence," defence counsel Morris Anyah told the BBC's Newshour programme.
The appeal process could last up to six months, the BBC's Anna Holligan in The Hague reports.

Continue reading the main story

“Start Quote

While Mr Taylor never set foot in Sierra Leone, his heavy footprint is there”

Judge Richard Lussick

'Heinous crimes'

Taylor, wearing a suit and yellow tie, showed no emotion during the hearing.

"The accused has been found responsible for aiding and abetting some of the most heinous crimes in human history," Judge Richard Lussick said.
The crimes - which took place over five years - included cutting off the limbs of their victims and cutting open pregnant women to settle bets over the sex of their unborn children, he said.
The prosecution had wanted an 80-year prison term to reflect the severity of the crimes and the central role that Taylor had in facilitating them.

But the judge said that would have been excessive - taking into account the limited scope of his involvement in planning operations in Sierra Leone.

However, Judge Lussick said in return for a constant flow of diamonds, Taylor provided arms and both logistical and moral support to the Revolutionary United Front rebels - prolonging the conflict and the suffering of the people of Sierra Leone.
"While Mr Taylor never set foot in Sierra Leone, his heavy footprint is there," the judge said.
"The lives of many more innocent civilians in Sierra Leone were lost or destroyed as a direct result of his actions," he said.
In its landmark ruling in April, the court found Taylor guilty on 11 counts, relating to atrocities that included rape and murder.
He became the first former head of state to be convicted of war crimes by an international court since the Nuremburg trials of Nazis after World War II.
This "special status" had put Taylor in a "different category of offenders for the purpose of sentencing," the judge said.
'No remorse'

Taylor, who accused the prosecution of paying and threatening witnesses in his war crimes trial, had asked judges to consider his age when making their decision, saying he was "no threat to society".

But the trial chamber said that, given his social background and standing, "rehabilitation" was not likely.
The fact that he had not expressed remorse or apologised for his part in the conflict also affected the sentence, the judge said.
Earlier, his lawyers had urged the court not to support "attempts by the prosecution to provide the Sierra Leoneans with this external bogeyman upon whom can be heaped the collective guilt of a nation for its predominantly self-inflicted wounds".
Taylor's brother-in-law in Liberia, Arthur Saye, maintained the whole process had been "politically motivated".
"The sentence is outrageous. How can you give a man 50 years for only aiding and abetting?" he told the BBC.
Suzanah Vaye, whose husband was killed during the last days of Taylor's rule, was less sympathetic: "Today, I join Sierra Leoneans in saying this should be a lesson to people that God has his own way of bringing judgement to people."
The case was heard in The Hague for fear that a trial in Sierra Leone could destabilise the region.
The Dutch government only agreed if Taylor would serve any sentence in another country.
He will serve any prison term in the UK but will be held in The Hague until the results of his appeal.

US Dollar Index Classical Technical Report 05.23

2012-05-28T06:30:00.002-07:00

The market has now taken out some major resistance by 10,100 to open the door for fresh upside and a bullish continuation over the coming weeks. Next key resistance comes in by the 10,300 area, although, with daily studies now overbought, look for opportunities to buy on dips back towards 10,000 where a fresh higher low is now sought out