"Reports from the 12 Federal Reserve Districts suggest that economic activity continued to be weak going into the summer, but most Districts indicated that the pace of decline has moderated since the last report or that activity has begun to stabilize, albeit at a low level. Five Districts used the words "slow", "subdued", or "weak" to describe activity levels; Chicago and St. Louis reported that the pace of decline appeared to be moderating; and New York, Cleveland, Kansas City, and San Francisco pointed to signs of stabilization. Minneapolis said the District economy had contracted since the last report."
Full report:
Beige Book
Playing the contrarian angle, I am currently long for several contracts for the EUR/USD, which is trading at lows (so far) of the session and in-and-around the support zone I discussed in my last post, in anticipation of some (hopeful) short covering in the next 24-36 hours after the less-than-apocalyptic report that just hit the wires. Mind you, that I still need to do a bit more than skim the report myself. The consensus seems to be that major support comes in at about 1.3750/1.3850, and that short term support is near 1.3980-1.4000 which has held as of this posting. My stops are well below major support in anticipation for the usual risk aversion that has characterized the Asia session over the last few weeks. I fully anticipate more downward movement but so far as of 18:54 GMT (14:54 EST), the selling of EUR/USD has moderated but the risk is still palpable with the S&P hovering near 970. I am hoping to ride this as a swing trade over the next few days, with modest targets of 1.4180, 1.4220, and possibly another attempt at the 1.4300, but subject to change as always. I will be watching the chart for the next few hours to see the end of the New York session and I will be updating again soon.
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