Monthly Archives: January 2012

Even with EUR gloom, markets turn on USD

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Markets Turn on USD Despite EUR Gloom

USD v. EUR binary options editorial comic strip for optionsclick news update service

Who's pushing who currently?

Despite a raft of negative data coming from Europe over the last 24 hours, the markets found enough hope coming from the EU Summit to ditch the USD and find favor in the EUR.

The USD fell against major currencies and the EUR made gains even though a fiscal pact between the 27 member states designed to enforce budget discipline was rejected by both Britain and the Czech Republic.  However, the focus on reducing unemployment down to an average of 10% and talks on support small and medium sized businesses was enough to persuade investors to cash in gains made in the USD yesterday and pile in to more risky positions and commodities.

Also coming from Europe yesterday was the news that France, the 2nd largest economy in the Eurozone, reducing its growth forecast for 2012 from 1%, down to 0.5%. However, the IMF still expects the French economy to grow by just 0.2% this year, down from a revised 1.4%.

There was more trouble for Spain. Last week it announced that unemployment at 22% was at its highest level for 17 years, with 48% of all 16-24 year olds unemployed, twice the Eurozone average. Yesterday, the Spanish statistics office confirmed that the Spanish economy contracted by 0.3% in Q4 of 2011, fueling speculation of a recession in Spain.

With no debt deal yet to be agreed in Greece, investors still found enough hope coming from the EU Summit to cause a rally in the EUR. The EUR/USD was up 0.350%, trading at 1.3189, whilst the EUR/JPY was up 0.221%, trading at 100.57. There were also gains made in the GBP/USD, up 0.169%, trading at 1.5736 and in the AUD/USD, up 0.330%, trading at 1.0634, as investors abandoned the greenback.

The weakened USD saw a rally in commodities, with much of the losses recouped from yesterday. Gold was up 0.29%, trading at 1739.45 and Crude Oil was up 0.60%, trading at $99.38 a barrel.

Today will be dominated by events in Brussels as the last day of the two day summit should spark some volatility in the market. Expect investors to wait and see what happens but some intraday volatility caused by profit taking.

 

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Disclaimer: The opinions expressed in this article are not necessarily those of OptionsClick, blog.optionsclick.com, OptionsClick.com or any of its staff. The contents of this article are in no way intended to be advice or any other form of counsel for any trader of binary options or any other investor. Please be advised: Investing of any kind always carries a relative risk. As with any market trading, it is always possible to lose your investment. Always be sure to do your own research, seek professional advice, and make your own, well-educated decisions when it comes to financial investments.

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Iran Threatens, Oil Falls

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Oil Drops Despite Iran Threats

The price of crude oil fell in early Asian trading despite threats from Iran that it will stop selling oil to ‘some countries’. Iran produces 3 million of barrels a day and is responsible for 5% of the world’s total oil production. The EU agreed to ban the importing of Iranian oil on January 23rd, but the embargo is not due to come into effect until July 1st. However, in further saber rattling, Iran responded to the visit of the International Atomic Energy Agency inspectors by announcing the ban as to yet unidentified countries. The EU accounts for approximately 20% of Iranian oil exports and so far the markets have responded more to the strengthened USD with Crude Oil falling 0.58%, trading at $98.98 a barrel.

Iran's top oil export destination markets 2010

Crude Iranian relevance

In currency news, the USD found support as the markets either abandoned the EUR or adopted a wait and see attitude as talks in Greece have yet to find a satisfactory conclusion. The talks are aimed at restructuring 100bn euro of debt in order to prevent a default when its loan repayment is due on March 20th and secure the next tranche of funds from the bailout fund. The EUR/USD was down 0.355%, trading at 1.3173, whilst the EUR/JPY was down 0.385%, trading at 100.99. The Euro also lost ground against the Swissie with the EUR/CHF was down 0.025%, trading at 1.2059.

The USD was finding support across the board in Asian trading with the dollar index rising 0.28%, trading at 79.16. Investor support should continue as talks continue over Greece at the two Euro summit starting this morning.

 

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Disclaimer: The opinions expressed in this article are not necessarily those of OptionsClick, blog.optionsclick.com, OptionsClick.com or any of its staff. The contents of this article are in no way intended to be advice or any other form of counsel for any trader of binary options or any other investor. Please be advised: Investing of any kind always carries a relative risk. As with any market trading, it is always possible to lose your investment. Always be sure to do your own research, seek professional advice, and make your own, well-educated decisions when it comes to financial investments.

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MARKET CLICK – MONDAY, JAN 30 2012

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Trader Mavens! Every Monday we give away $250 cash!
Congratulations to last week’s winners 

Greece, Creditors, Bondholders Agree to Terms, Deal Expected

  • EUR/USD rose as much as 2.2% last week, but closed Friday on a down note. It is expected to dip again even if a new debt agreement with Greece is finalized.
  • Private sector creditors will now agree to new terms with Greece, making their bonds worth only 40% of their original value. Though positive for Greece, it could mean more difficulties for the EUR.
  • Gold is at a seven week high. Investors are expecting Gold to continue as a safe haven, selling only to cover losses from currencies and stocks.
  • Oil is above $99/barrel amid a production shutdown in South Sudan and concerns that Iran will cease exports.
ASSET CHANGE LAST TREND PLATFORM
NIKKEI - 51.00 8,790.22 DOWN HIGH/LOW
S&P 500 - 2.10 1,316.33 DOWN HIGH/LOW
NASDAQ + 11.27 2,816.55 UP HIGH/LOW
GOLD + .30 $1,732.50 UP HIGH/LOW
OIL - 0.43 $99.13 UP HIGH/LOW
EUR/USD - 0.0048 $1.3176 DOWN HIGH/LOW
USD/JPY - 0.03 76.64 DOWN HIGH/LOW
DOW - 74.17 12,660.46 DOWN HIGH/LOW
GOOG + 11.88 579.98 UP HIGH/LOW

How will you profit this week at OptionsClick?

WHAT SHOULD I TRADE? GOLD, OIL, EUR/USD

WHAT ARE THE TRENDS? Expect short term rallies should an agreement with Greece be finalized.

WHAT PLATFORM SHOULD I USE? Use the HIGH/LOW platform for best results this week.

WHAT ELSE SHOULD I KNOW? US jobs reports later this week will help investors to better predict the value of the USD vs other currencies.

 

Recent Popular Trends
GOOG HIGH
GOLD HIGH
OIL TOUCH
EUR/USD HIGH
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A dip for the US Dollar at the end of the week

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“USD Ends Week With Falls”

The US Dollar ended a volatile trading week posting falls against most major currencies as a lower than expected GDP for Q4 came just two days after Fed warnings of no rate change until 2014. What had started as a strong week for the USD, as investors sought out safer positions in the currency markets, ended with falls in most currency pairs.

Although Q4 growth year on year was up 2.8%, much of that growth can be attributed from businesses replenishing inventories and not on purchases of capital goods, which indicates the economic recovery gathering pace. As a result of worse than expected news from the US and some serious profit taking by investors, the EUR/USD was up 0.847%, trading at 1.3220, putting real pressure on the 1.35 resistance level. The Euro was boosted by encouraging news from Greece, who now looks likely to meet their loan repayments due on March 20th and entitle them to the next tranche of funds from the bailout fund.  Although a deal has yet to be finalized between Greece and its creditors, investors should look for a boost in the EUR when this happens.

In a week where world finance and business leaders are meeting at Davos, there was more troubling news coming from the Eurozone. In Spain, unemployment passed 5 million, with the rate rising to 22.8%, up from 21.5% – the highest in 17 years. The 22.8% is more than double the average unemployment rate in the Eurozone and despite the new Ruling party pledging reforms, the week ended in demonstrations against austerity reforms and unemployment.

There was more bad news in the Eurozone at the end of the week, Fitch, the credit ratings agency downgraded 5 Eurozone members as Italy and Spain lost two notches and Belgium, Slovenia and Cyprus lost one notch. The EUR/JPY was down 0.149%, trading at 101.38 as investors looked for a safe haven that wasn’t the USD.

The weakened greenback saw a push into commodities and investors should be looking at more of the same this week. Escalating tensions in Iran may push the price of Crude Oil up, it stands at 99.71 a barrel, but the real gains were made in precious metals. Despite some showing of a risk appetite, investors will wait and see what comes from Europe and Davos this week, whilst finding refuge in commodities.

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Disclaimer: The opinions expressed in this article are not necessarily those of OptionsClick, blog.optionsclick.com, OptionsClick.com or any of its staff. The contents of this article are in no way intended to be advice or any other form of counsel for any trader of binary options or any other investor. Please be advised: Investing of any kind always carries a relative risk. As with any market trading, it is always possible to lose your investment. Always be sure to do your own research, seek professional advice, and make your own, well-educated decisions when it comes to financial investments.

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Greenback falls on pledge of Fed Rates

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“USD Falls on Fed Rates Pledge”

the greenback falls thanks to stepping off the interest rates cliff's edge and fortunate has the parachute of the 2012 elections to enjoy a softer landing, in this binary options editorial cartoon for optionsclick blog

What color is your parachute?

The USD fell against most currencies in Asian trading as the Federal Reserve of the US surprised markets by saying it does not expect to raise interest rates until towards the end of 2014. The announcement made in its regular policy statement emphasized the ‘significant downside risks’ the US economy was facing and kept the target rates of between 0 – 0.25%. This despite 3 of the 17 committee members thinking rates should be increased by the end of 2012.
The forecast growth for 2012 was cut slightly, down to a range of 2.2 – 2.27%, this from the previous 2.5%-2.9%. However, on a more positive note, unemployment forecasts were down to 8.2% from 8.5%.
The Fed announcement took the markets by surprise, and after a week of safe haven seeking investors pushing the price of the USD up, the EUR/USD was up 0.084%, trading at 1.3118, whilst in the Cable, the GBP/USD was up 0.019%, trading at 1.5660.
The weakened USD saw a rise in both Gold and Crude Oil. Gold continued the week long rise, posting a 0.61% increase in Asian markets, trading at $1710.55 an oz, whilst Crude Oil broke the $100 a barrel once more, trading at $100.19 a barrel, a rise of 0.80%.
The weaker greenback also encouraged some bullish action on the stock markets as the US SPX 500 was up 0.87%, settling at 1326.06 and the US30 was up 0.66%, trading at 12758.85 as US stocks and shares became cheaper for investors.
Today investors should look out for comments and press statements made from the World Economic Forum Meeting held in Davos today. The meeting attended by central bankers, prime ministers, finance ministers and business leaders from more than 90 countries usually generates market volatility as meetings are mostly open to the press and statements made to the press throughout the day.

 

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Disclaimer: The opinions expressed in this article are not necessarily those of OptionsClick, blog.optionsclick.com, OptionsClick.com or any of its staff. The contents of this article are in no way intended to be advice or any other form of counsel for any trader of binary options or any other investor. Please be advised: Investing of any kind always carries a relative risk. As with any market trading, it is always possible to lose your investment. Always be sure to do your own research, seek professional advice, and make your own, well-educated decisions when it comes to financial investments.

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