Pre-Market

Overnight Chinese import/export numbers came out giving China a trade surplus, the problem with this data and other recent data releases from China is that the street doesn't believe them.

Jumping to Europe, Germany came in with the second consecutive day of strong economic numbers, this time German Industrial Production rose 1.2% despite expectations of a -0.1% drop, up from 0.6%. This data sent the EUR/USD higher and may be as fictitious as China's, but neither country wants and perception of further economic deterioration and for now, this should hold any ECB cuts off as Germany wants.

The ECB said overnight they are looking at ways to revive the market for asset-backed securities (ABS) to allow banks to pass some credit risk on to other investors as they try to boost their capital and liquidity buffers to meet new regulatory standards. As earlier reported in the German newspaper Die Welt, citing a central bank source, a majority of Governing Council members seemed to be in favour of the ECB buying asset-backed securities (ABS). Responding to a question about the Welt story, Asmussen said ECB work on what it could do to spur SME lending was ongoing. "We have an open mind to look at all things that we can do within our mandate and this relates to how can the market for asset-backed securities, especially backed by SME loans, be revived in Europe," he told a European Parliament committee. This explains how the ECB will engage the other world central banks at a time when everyone is going full throttle with diluting their currencies. After all Draghi made it quite clear in the latest press conference that the Euro is rather overvalued and that the ECB is considering ways to push it lower.

As for futures, it looks like all the currencies that are market supportive have gone about as far as they will go, they are all negative pre-market.

Index futures is where it gets interesting, they are not only not that far from unchanged, but their divergences are stretching over this entire week thus far and with the $USD having a similar positive divergence, this could be an interesting day that explains some of what we saw in the last post from yesterday.

 EUR/USD negative

EUR/JPY negative

AUD/JPY negative

The $USD has a much bigger positive divergence than we realized as it continued to build even though price had not moved.

ES 1 min going negative and flat for the overnight

 ES 15 min negative on a longer trend of this week, which is interesting given last night's data.

NQ 1 going negative, but otherwise pretty close to flat for the overnight session

The 15 min NQ chart, this is pretty clear, as I say, if you can't make out a trend, go to a longer chart and there we find a big surprise, but it gets worse...

TF (Russell 2000 Futures) 1 min look horrible, as has the IWM.

The 5 min version, not good.

An interesting day indeed....

I have an interesting start to my day with a dentist appointment at 8:30 so I should be back for the open, wish me luck, I may be a little loopy from the gas- I'm kidding.