fxKnight.com

Thu, Oct 2 2008, 03:55 GMT
by Andrei Pehar

The United States Senate today approved the revised and expanded $700 billion dollar bailout bill with a vote of 74 to 25. Now the bill returns to the House of Representatives for a re-vote on Friday, before heading to President Bush to be signed into law.

The bill includes tax breaks for corporations, as well as certain individuals in special situations such as disaster victims and mental health patients. No doubt it will soon be sold to the public (which previously phoned the offices of elected offices with a 30-to-1 disapproval ratio) as a tax relief package for the average worker hit by the turbulent economy.

Will it work?

That ...

How to Determine the Next Likely Direction for Oil

With all the turmoil in the markets, how to we get a clear sense of direction? Well, for oil at least, there are two key numbers to watch:

If we finish this week with a close above 110.51, and manage to find some support at that level, then that future direction may well be up, which will not help the U.S. financial markets very much. If such a scenario comes to pass, then the next likely resistance level is at 124.56

If instead trading takes us down below 99.16, then we may be headed to test support at 87.81 next. We may also range in the 99.16 - 110.51 area for another week or two.

Markets are bracing for what could well turn out to be THE most dramatic day ever seen. Yes, perhaps even more so than the fireworks of last week.

Several situations are brewing all at once:

Washington Mutual has been seized by the FDIC (Federal Deposit Insurance Corporation), and its client accounts are in the process of being taken over by JP Morgan. Account holders are being assured that they will have access to their funds; however this is – officially – the biggest bank failure ever in history.

Fortis is under fire from the media and from shareholders. They maintain that they are solvent and have adequate access to liquidity lines (which they say they cannot reveal due to non-disclosure ...

How to Catch the Next EUR/USD Move

The Euro has spent the past few days ranging against the US Dollar, after completing a perfect 61% to 161% Fibonacci move. How will we know when the next big move is under way?

The top end of the range is marked by a Fibonacci resistance level at 1.4708 - a break above this, followed by a re-test as support, would likely take us up to re-test the prior 1.4850 high, with a secondary target at 1.5078 should that break.

On the bottom, support is being provided by the 21 exponential moving average, and has gradually shifted from 1.4588 up to 1.4641. A break below these levels would likely take us down to 1.4480, perhaps 1.4452, with 1.4355 as a secondary target. ...