Euro May Be Poised For 'Explosive Breakout,' Citigroup Says

Euro May Be Poised For 'Explosive Breakout,' Citigroup Says

www.bloomberg.com

(Bloomberg) -- The euro may be nearing an ``explosive breakout,'' reaching record levels against the U.S. dollar, according to a Citigroup Global Markets Inc. research note.

The trading pattern, including a so-called double-bottom that tested lows, resembles the one before Feb. 26 that preceded the surge to $1.6019 per euro, analysts Tom Fitpatrick in New York and Shyam Devani in London wrote in the note today.

`` We cannot help but feel that things might be about to get very bad again,'' the analysts said, referring to the possible combination of falling bond yields and rising oil prices.

(visit the link for the full news article)

Eesh...This is something EVERYBODY better be keeping an eye on. With OPEC and Iran talking about switching over entirely to Euros for Oil trade, this could have potentially devestating consequences on an already crippled economy. The Euro keeps going up, as the dollar keeps losing value. If the Oil producers switch over to Euro's, and they are nearly DOUBLE the value of the dollar...Well you can guess what happens next. Things would go from ugly to beyond our worst nightmares...

www.bloomberg.com
(visit the link for the full news article)

This news comes at the same time that reports in the United States are stating:“United Nations sources report that there has been a sudden rush in requests for foreign exchange wire transfer requests from New York City banks. The sudden demand for transferring funds abroad has resulted in a 24 to 48-hour processing delay due to the sheer volume of requests.Foreign employees at the United Nations are transferring their money from accounts at the United Nations Federal Credit Union (UNFCU) and other New York City banks, both domestic and foreign-owned, and the move has been sudden.There has been no explanation for the sudden wire transfer activity, although the rumor mill suggests fears of a sudden economic collapse and/or a U.S. and Israeli military attack on Iran, which could touch off a wider regional conflict.”June 28, 2008

Fortis expects bankruptcies amongst 6000 American banks which have a small coverage currently. But also Citigroup, General Motors, there is starting a complete meltdown in the US”

Fortis Bank predicts US Financial market meltdown within weeks…
Fortis is a large bank and insurer in the Netherlands and Belgium. It took over ABN Amro last year, together with RBS and another bank. Last Thursday, its share lost 17% because Fortis attracted foreign capital.

I was shocked when I read the following, which was brought out 4hours ago:

American ‘meltdown’ reason for money injection Fortis.
28th of June, 9:10
BRUSSELS/AMSTERDAM - Fortis expects a complete collapse of the US financial markets within a few days to weeks. That explains, according to Fortis, the series of interventions of last Thursday to retrieve € 8 billion. “We have been saved just in time. The situation in the US is much worse than we thought”, says Fortis chairman Maurice Lippens. Fortis expects bankruptcies amongst 6000 American banks which have a small coverage currently. But also Citigroup, General Motors, there is starting a complete meltdown in the US”

This fits in the picture, with the other press releases last week, like the short advise of Goldman Sachs and some other of the same messages last week.

Although gold has rallied a lot lost week: first thing monday morning: short Dow, long Gold?

Or will there be a rate cut, which undermines (delays) everything?

Original press release:

dprogram.wordpress.com...

This news comes at the same time that reports in the United States are stating:

“United Nations sources report that there has been a sudden rush in requests for foreign exchange wire transfer requests from New York City banks. The sudden demand for transferring funds abroad has resulted in a 24 to 48-hour processing delay due to the sheer volume of requests.

Foreign employees at the United Nations are transferring their money from accounts at the United Nations Federal Credit Union (UNFCU) and other New York City banks, both domestic and foreign-owned, and the move has been sudden.

There has been no explanation for the sudden wire transfer activity, although the rumor mill suggests fears of a sudden economic collapse and/or a U.S. and Israeli military attack on Iran, which could touch off a wider regional conflict.”

www.whatdoesitmean.com...



It seems a few different sources have come to the same conclusion. Very Interesting !

I just cannot believe that people are still sat in their bubbles, fingers in ears going 'la la la la I can't hear you!' over this issue.

This is going to be bad - One terrible thought I had just now reading that.

Hitler went to war over the very issues (albeit worse than todays markets and inflation) but who is to say that if this collapses the American dollar to the floor that they will not lash out in a moment of luncay, or create another 'phantom' enemy to chase around the globe in a never ending war ?

[edit on 3-7-2008 by Dan Tanna]

Yup Dantanna thats why Iran will be first. Then right after that we will go for China. They have been warming the people up for it for awhile now with tainted toys and what not. The propaganda machine will be in high gear. Im very nervous about what could be the end of the nation as we know it. Then again if we get rid of the FED over the whole deal it might be worth it maybe that is wishful thinking.

When things are bad or seemingly bad markets look for capitulation. It seems to me the dollar wants to go down. The United States have become somewhat irrelevant on the world stage as we have demonstrated that we cannot be trusted i.e. Powell at the UN etc. x 1,000+.

Military power is but one aspect of power. We have lost the moral high ground. We suck as bas as the USSR did when they blew that passenger plane out of the air over Kamchatka or we are revisiting the lows of when we shot down the IRqanian passenger plane.

money is fleeing, which could in the mid to long term contribute to a revitalization of democracy and a new path for the USA. Canada and Australia seem almost lock step with us and Great Britain.

We pretend to our peril that we are smarter than the rest of the world.

Interesting...it was the run on the banks that started the first Great Depression.

Then again Citigroup's stock has been failing like a rock here lately so hard to say if they are "in the know" or not. Some have speculated that they are dangerously close to collapse like Bear Sterns. So this statement may be more about covering their own butts in the eyes of their shareholders.

As for China...don't forget they hurt our little doggies last year too. Which had nothing to do with questionable business practices of our pet food manufacters of importing grain products. Since the US government doesn't pay farmers to not grow to keep the prices from bottoming out or anything....

[edit on 3-7-2008 by Ahabstar]

Is this the "something big is coming" Ron Paul was commenting on? Not that I'm a Ron Paul fan but a friend of mine was asking me if I knew what he was talking about - and I'm thinking this is it....

Speaking of the Euro and the EU - the most powerful figure in this possible breakout scenario is Javier Solano - He has been a busy little bee these past few years attempting to guide a united Europe into superpower status in which the U.S. is the bouncer...say hello to your new boss - our world is about to change, kids, big time....the American people are going to have to step up to the plate and help each other...It may get pretty dicey but nothing like a little stress to show what we're made of....

This is highly unlikely, they are basing all of their predictions on technical analysis and not fundamentals. The fact is that it is the benefit of the international community to keep the dollar up, and it's already grossly undervalued using PPP. The Euro Zone's economy isn't strong enough to justify a break out of their currency, if their currency was to continue strengthening they would probably spiral into something horrible, the EU is overrated and has tons of problems coming it's way.

reply to post by yellowcard


I need some info....

Isn't Lindsey Williams theory on Iran flooding the market with cheap oil
designed to collapse the US dollar because they are on the Ruble? or another currency? or the Euro?

Thanks

I'll second the comment that Europe is over-rated!

Most don't want it - it's being forced upon us. They're going to keep giving Ireland the vote until they says "Yes".

The Euro appears to be having problems, anyway. German Euros aren't considered the same as say Bulgarian or Spanish Euros, even though they're supposed to be a "single currency".

This is pretty much saying "The dollar is going to tank" in reverse speech.

It's not that the Euro is so strong, it's that the dollar (and US economy) are up against the wall. Guess its a bit more palatable for home consumption for Citibank to phrase it that way.

The Fortis story is a hoax. It was written by a janitor at a US University.

www.opednews.com...

Next week will be a historic up market for US and European stocks IMO>

reply to post by disgustedbyhumanity


Just shows to go ya thanks for posting that bit of info - my roomie works in a brokerage - I asked him about it - He said "Its just talk...its always just talk - same old same old"....hmmm...well thats a lesson in the gullibility of us all innit?

Well to the man in the street, the dollar has been losing ground for a number of years. Its not the international currency of choice anymore, certainly not around Europe or the Meditteranean Regions.

Originally posted by yellowcard
This is highly unlikely, they are basing all of their predictions on technical analysis and not fundamentals. The fact is that it is the benefit of the international community to keep the dollar up, and it's already grossly undervalued using PPP. The Euro Zone's economy isn't strong enough to justify a break out of their currency, if their currency was to continue strengthening they would probably spiral into something horrible, the EU is overrated and has tons of problems coming it's way.

It may be a benefit to keep the dollar up but do you see anyone running to our help? No in fact you saw the ECB just raise rates. The fact is I DO believe this story even though a small part of me says this is all negative propaganda and the banks are really sitting on a load of money ready to let it fly. But the more and more I look at the fundamentals like M3 and MZM along with a FED and government who spends and prints all sorts of money we dont have no wonder this is happening. Oh they will deny it its not inflation its those mean Saudis or the mean oil companies that is causing the dollar to crash. Yellow these people who have the power have built and bankrupted several countries for the sake of making a buck and they do not care about the people of their fate. I hope your right though and I hope that small feeling in me is right but im still on guard.

Originally posted by disgustedbyhumanity
The Fortis story is a hoax. It was written by a janitor at a US University.

www.opednews.com...

Next week will be a historic up market for US and European stocks IMO>

Most posts also claim that the original story was written in Dutch, and a few even contained a dead link to the alleged original story on Da Telegraaf, a Dutch news submission site. After searching the Da Telegraaf site, I was able to find the original story, which was submitted anonymously. It had no author, it sited no source, it came from no news syndicate (such as Reuters or Associated Press), and it was submitted to no news syndicates.

www.opednews.com...

Well, indeedly the story is there, and its signed "door de redactie"... Not utterly anonymous.

Dutch, anyone ?

reply to post by disgustedbyhumanity


I hope your DD is better than your reading comprehision. A limbaugh worshiping perverted college janitor did start an internet hoax, but it involved Hillary and the Black Panthers. That post does make some good points about simillarities of the Fortis piece and a typical internet hoax though. So we just need someone to label the RBS piece from the Telegraph and the story about the BIS hoaxes and we can all sleep well now.

You could be right about a big up week next week though. No FDIC bank siezures apparent. I haven't seen any big negative news on headlines yet this weekend. Most technical indicators are showing an oversold condition. Trichet followed his rate raising with soothing words.

But, the Nikkei just posted its 12th straight red print and by Monday's US open could be on 13. Crashes do come from oversold conditions. Hearing about a new wave of writedowns in banks. Still plenty of time for a tape bomb before Monday. I don't know if the youtube/google news hit during market hours but that could ding the Nasdaq.

I think the rise of the Euro is more about the fall of the dollar than anything else. We very much have a "Tale of Two Central Banks" going on here. The ECB's only mandate is price stabillity. The US has that and growth as dual mandates. Bernake has chosen to save certain US banks at the expense of everything else. So far this has been relatively positive for the equity markets, but I believe he will sacrifice them at some point by withdrawing liquidity to keep bond yields down. Until the FED get's serious about fighting inflation, I don't see the dollar strengthening much. There is also a danger of a Soros effect. With the Fed's now encumbered balance sheet, you gotta think that big sharks like Soros are just waiting for an opportunity to "break the buck". Of more importance than the Euro/Dollar cross, are the Euro/Everything else crosses. I get the feeling that some in Europe would LOVE to see the Euro replace the Dollar as the world reserve currency, and Trichet may be one of them.

Here's the translation requested by others earlier:

Translation of Da Telegraaf report from Fortis. (American Meltdown, Fortis Reason, Money Injection ("injection" probably alludes to a requirement).

Yep, I've been trading EUR against USD lately.

Wow... that trend is beautiful isn't it?




At the moment it's on a quick downward spike, but it should bounce back, and pretty drastically too. Just waiting for it now.


The Euro has been doing consistently well against the US Dollar. The US Dollar on almost all fronts has been doing quite poorly. Only balancing out recently with the AUD and CAD.