A.M. Update

Overnight the ECB's (European Central Bank) executive board member, Coueure said that the ECB would be "front-loading" their Q/E bond buying in May and June ahead of a low liquidity period over the summer. Net issuance of Eurobonds is actually highest in May. While not specifically citing the Eurobond's increased liquidity during the month, the message was simply that the summer buying would be moved to May/June because of poor liquidity conditions through the summer.

For some reason it took 6 hours for this news to break! The speech in which the details were delivered was given on the night of May 18th (yesterday).

In any case as you might expect, this sent the EUR/USD sharply lower...

EUR/USD down sharply at the European open which has sent the pair below 1.12 to 1.113.

This of course sends the already bouncing $USD even higher...

$USD 1 min. (the red arrow is yesterday's 4 p.m. cash market close)

This of course, after yesterday's $USDX breakout above its "W" base now has there $USD firmly in the counter-trend bounce we have been expecting...

This is the 60 min chart of the $USDX I've been using to show previous counter trend bounces, but this one was expected to be larger than the previous ones (yellow) and looks as if it already is. (I removed 3C so the bounce could be seen more clearly, but it is perfectly in line with price throughout the entire chart including the bounce).

This has had most of the effects expected so far with gold and oil lower on the stronger $USD...

 Gold futures 1 min with good 3C confirmation...

Brent Oil futures (1 min) with both Brent and WTI lower with good confirmation.

The Treasury complex did take a hit and pulled back, near the original area I was looking for a head fake/stop run last Thursday, but seemingly unrelated to the ECB decision...

30 year treasury futures up initially at 3 a.m. (European open) and down around 8 a.m.-ish.

The Index futures also jumped, but have since moderated...

 I'm using Russell 2000 Futures as an example as it's easier to scale with a longer history than ES and NQ for me. The red arrow is yesterday's 4 pm EDT cash close, the green arrow is the 3 a.m. EDT European open and then a negative divergence and almost all of the gains since the European open now having been retraced.

 This is the 1 min ES 3C chart with yesterday's cash close at 4 pm at the red arrow, this morning's European open at 3 a.m. EDT at the green arrow and another negative divergence sending ES lower this morning in pre-market.

A closer look at ES with the European open at the green arrow to the far left and the yellow row denoting 8:30 a.m. in which SPX futures have retraced nearly all of their ECB-led gains.

And the 1 min NQ futures (NDX-100) with the US close and European open at the red and green arrows, also retracing the ECB-based gains.

We'll get a much better look in the cash market, but these gains normally "should: have held at least until the cash open.

We'll be watching position management on USO equity short and June 19th Gold puts as well as TLT longs.


More shortly...