The moment that Europe and the U.S. have been lobbying for over the past nine months finally arrived, as China ended the rule based exchange rate “peg” of the Renminbi, or Chinese Yuan, to the U.S. Dollar. While the immediate implications of a floating Yuan are positive for Asia as a whole, the mid-term reprocussions of a stronger Renminbi may tell a starkly different tale.

As founder and editor of Diamond Slice I’m proud to announce that The Weekly Spectrum is going to be more “focused”. It’s obvious that you can get a weekly outlook anywhere on the net, so the one you’ll find here is about to become a bit, well, edgy. There’s enough “fair and balanced” out there to kill us all of boredom, I believe that we at DS can give you something much better, something much smarter, and something you can actually profit from. So without any further ado, I give you “The Weekly Spectrum” 2.0…

June 17, 2010 – Stock markets around the world have found solace in the leaked, then officially released, China Export data; showing a 48.5% increase in exports in May from comparable data in 2009. Conveniently timed with the past week’s global equity rally that followed the China Export numbers, were several announcements from South Korean financial leaders. First, Korea announced new measures to tighten restrictions on Currency Futures trading, and then proposed an indefinite re-opening of the currency swap lines between the Bank of Korea and The U.S. Fed, which were closed in February 2010…

In the week ahead the U.S. equity market, broadly represented by the S&P 500 index, will be looking for direction as the level reaches its 200 day moving average (MA), which had served as firm support before dropping below that level on May 22, 2010 for the first time since mid July 2009. By our analysis, markets are now undergoing a sentiment shift, in turn morphing the 200 day MA into a resistance; twice tested but not yet broken since crossing below on May 22.

The Washington D.C. summit in 2008 crowned the Group of Twenty Nations (G20) as the official global economic summit of industrialized countries. Two years in, Korea is proud to have been chosen to Chair the 2010 G20 summit, which was kicked off in Busan last week for a meeting of the group’s finance ministers. Hosting the G20 certainly represents a milestone on Korea’s global economic ascent; however, the communiqué out of Busan begs a dissimilar fate for the unification of the group…

Consider this the first and last time we plan on bringing up the Oil spill disaster in the Gulf of Mexico. We don’t agree that 2018 futures should be trading at a $20 premium to near term WTI spots, and we think the trend of Crude Oil will ultimately continue lower, so we haven’t given this story much attention. That said, the ramifications on unemployment and the general economy of the U.S. Gulf Coast are becoming tangible and necessary for all to understand. Take 3 1/2 minutes of your day and listen to those affected by the disaster in their “own words”, in this Bloomberg Video Report…

This week will likely begin with some relief for the Euro, on G20 plans to cut costs in Euro states, while the hangover from Friday’s U.S. Jobs data could continue into a “no news” Monday trading session. Look for pops to add to shorts early in the week, but keep stops tight leading into Jobless claims and Friday’s data.

In the fourteen days since a verdict charged the Democratic People’s Republic of Korea (DPRK/The North) with sinking the Republic of Korea’s (ROK/The South) Cheonan warship, global investors have realigned risks on the Korean Peninsula at the center of their radars. In this edition of the Korea Economic Slice on KBC, we’ll venture into history to gauge the significance of the recent alleged attack on the Cheonan and analyze the potential outcomes and economic repercussions. Then, we’ll move to identify the coming week’s crucial economic reports, technical indicators from the KOSPI, and the effects of global risks in the Korea economy…

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There are several positions we had been waiting for and on Friday the limits were hit and trades were placed. We are exceedingly confident about these three trades, and we feel that it’s worth our readers’ time to take a peak at where we’re putting our cash. This “trade flash” will target those three trades.

The “sell-off” is now two weeks young as red flags are hoisted daily above a mob of jaw dropped spectators, formerly known as the efficient market. There is no absence of questions on the minds of international market forecasters. Instead, we’re hearing vague rhetoric from analysts and financiers that sounds more like confusion than any sort of prediction. The confident ones are still playing the “buy because markets are down” card, but we are taking an alternative, perhaps disagreeable, path.