Analitics
Traders Sell First and Ask Questions Late
Last week, we discussed 3 technical reasons that EURUSD support at 1.1050 support could give way, but even we were caught off guard by the ferocity of the selloff over the last week. The world’s most widely-traded currency pair started last week all the way up at 1.1450, but in less than a week and a half, EURUSD has shed nearly 600 pips to trade all the way down at 1.0870 as of writing.
Source: Forex.com
27.05.2015
Gold on shaky footing as dollar surges
Gold has been absolutely battered today. It has already shed some $20 from its opening price and as we go to press it is still hovering near the day’s lows. The considerably stronger dollar is chiefly responsible for this latest slide in the price of gold and other buck-denominated commodities. The greenback has found renewed strength in recent days thanks to a combination of stronger US data and a hawkish tone from the Federal Reserve. Several Fed members including Chairwoman Janet Yellen have talked up the possibility of raising rates later this year, possibly at the FOMC’s September meeting. Although they have acknowledged the soft patch in first quarter US data, most of the Fed officials think transitory factors such as the weather were to blame and thus foresee the return of brighter macroeconomic numbers later in the year.
Source: Forex.com
26.05.2015
IBEX bounces back after election-inspired sell-off
Following a long holiday weekend, European stocks started the day on the back foot before bouncing off their worst levels as we approached midsession. US index futures also point to a slightly weaker start on Wall Street. The main reason behind the earlier risk off tone was yet again concerns over Greece and its ability – or lack thereof – to repay loans totalling €1.6 billion to the IMF in June, starting with a €300 million payment on June 5. But as the session wore on, these concerns eased a little and European equities correspondingly bounced off their lows while the markets in Greece, which had sold off on Monday, traded in the positive territory as banks advanced. This comes after PM Tsipras, who won the backing from his Syriza party to conclude a bailout deal, said his country would accept a workable deal over economic reforms needed to unlock the bailout funds. Whether Greece will be able to make its repayments next month remains to be seen, but it looks like the situation there may have inspired the rise of anti-austerity political parties in some struggling European countries. In Spain, for example, the ruling Popular Party suffered heavy losses at the weekend's regional and local elections. This saw the anti-austerity Podemos party make a significant advance. As a result, shares in Madrid – where the markets were open on Monday – have suffered heavy losses at the start of this week.
25.05.2015
Crude oil eases back ahead of long weekend
Crude oil prices are retreating today, seemingly on profit-taking ahead of the long weekend. This follows sharp gains on Thursday and a smaller rally the day before which was inspired by news of a third drawdown in US oil inventories in as many weeks. Crude’s rally on Thursday was also supported by a retreating dollar. The US currency erased some of the gains it had made earlier in the week on the back of further weakness in macroeconomic data. This time it was the latest unemployment claims, manufacturing PMI, Philly Fed manufacturing index and existing home sales figures that dented its rally. Today’s CPI data obviously has the potential to inspire more volatility in the USD which in turn could impact the price of oil and other buck-denominated commodities.
Source: Forex.com
22.05.2015
S&P 500: trend looks strong as key levels approach
The last time I wrote about the S&P 500, in mid-May, the benchmark US index was trying to break out of a lengthy consolidation pattern and take out sturdy resistance around 2120 (see “Stocks: can S&P 500 finally clear 2120?” for more). In that report, we pointed out the fact that the bears had been reluctant to increase their positions meaningfully when a key support level had been broken. That pattern in our view was, and still is, bullish. What’s more, the index was making a series of higher lows in what essentially had been a messy bull-bear battle. Thus we argued that if it S&P did eventually break higher, the next move could potentially be explosive due to the significant amount of time it had spent in consolidation. Undoubtedly some bullish speculators had also been waiting on the side lines until the trend became clearer. Now, as can be seen on the updated 4-hour chart below, the index did, as we had expected, break higher.
Source: Forex.com
21.05.2015
Gold’s Two Fundamental Drivers and the Odds of a Breakout
"The desire for gold is the most universal and deeply rooted commercial instinct of the human race."
Gerald M. Loeb, Founding Partner of E.F. Hutton
For some reason, gold evokes more intense emotions for traders than any other financial instrument. Depending on who you talk to, gold is either the last real store of value amidst the final throes of the central bank driven fiat currency system…or a soft yellow rock with few industrial uses. Rather than dogmatically holding to either a permanently bullish or bearish outlook on any financial asset, we believe that traders that should keep an open mind and try to objectively analyze the fundamental drivers of gold.
Source: Forex.com
20.05.2015
DAX: bullish trend resumes
European stocks have extended their gains after yesterday’s key reversal day and as the S&P 500 hit a fresh record high. Today’s sharp rally has been in part inspired by comments from the ECB’s Benoît Cœuré who said that the central bank’s €60bn of monthly bond purchases would be increased slightly in May and June. Last week, Mario Draghi himself had said that the ECB will “implement in full our purchase programme as announced and, in any case, until we see a sustained adjustment in the path of inflation.”
Source: Forex.com
19.05.2015
AUDUSD: Could the RBA Break Trend?
It was only a matter of time before the market’s attention started paying attention to Greece once again. The rally in the EUR over the last month or so has been nothing short of amazing as the specter of disaster loomed over the European Union and virtually everyone knew about it. Nevertheless, the short squeeze in the EUR/USD continued, and even had some EUR detractors doubting their stances as EUR bears. As my colleague Matt Weller stated so poetically this morning, Greece’s Doomsday Clock is Nearing Midnight, so in lieu of talking more about that situation, let’s look forward to another potentially interesting development.
Source: Forex.com
18.05.2015
Capitol Hill’s holiday cheer boosts the dollar
The dollar is extending gains today as the fundamental back-drop improves in the US. The dollar recovery was initially spurred by the better than expected November retail sales data, which has triggered hopes that personal consumption can pick up at the end of the year after falling to a two year low in Q3. Secondly, the House of Representatives overwhelmingly passed a bi-partisan budget bill last night that would set spending limits for the next 2 years.
Source: Forex.com
13.12.2013
CHF: the SNB fails to stem appreciation
Everybody loves a trier, the Swiss National Bank (SNB) once again tried to talk down the Swissie at its meeting earlier on Thursday but the market didn’t listen and the Swiss franc is stronger across the board today.
The SNB maintained rates at 0%, pledged to defend its 1.20 peg in EURCHF and lamented the continued strength of the currency. The SNB referenced the ECB’s decision to cut rates in November and said it put them in a tricky situation, as
Source: Forex.com
12.12.2013
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