Well… It’s a “risk offâ€� day that began yesterday afternoon… The only strange part of this risk off trading is the fact that the euro (EUR) is rallying versus the dollar! I know, I know, that seems to be a very strange occurrence… But it’s true, it’s true, I did see a euro rally! Other than euros, and sterling (GBP), the rest of the currencies have taken on water versus the dollar since yesterday afternoon, and that includes gold and silver, which have sold off too.
[Read more...]2-Year High for Oil Pushes the Loonie Higher
January 3, 2011 by Leave a Comment
Well… As I expected, the euro (EUR) really ran up on Friday’s trading, as shorts were covered and trading books were squared for year-end. I truly believe that this euro-buying could be reversed as we go through the first month of 2011… The reason I say that is I truly believe that the euro will come under pressure, as the Eurozone gets probed to come up with better solutions to their periphery countries’ problems. I expect Germany to balk at many things, and when they balk, the runners get to move up…the runners being the dollar, and gold…
[Read more...]US Data Indicate Slow Economic Growth
December 23, 2010 by Leave a Comment
The dollar stayed in the tight range in which it has been trading over the past week. The range of the dollar index over the past 5 days has been just 0.71%. Talk about stable markets! We had a plethora of data released here in the US yesterday, with most of the numbers coming in below expectations. The big number was third quarter GDP, which was reported at 2.6% compared to an estimate of 2.8%. While the number failed to reach economists upbeat estimates, it was slightly higher than the previous estimate of 2.5% growth. Personal consumption for the third quarter also came in below expectations with a 2.4% increase compared to predictions of a 2.9% rise. And the final piece of data in the GDP group, the GDP Price Index, rose 2.1% versus survey estimates of 2.3%.
[Read more...]US Data Releases Could Move the Markets
December 22, 2010 by Leave a Comment
Good day… We had another fairly quiet day in the markets on Tuesday, and it looks like most of the currency desks have already been placed on autopilot. Every year we get a lull in trading activity toward the end of the year, as most of the currency investors square up positions and don’t take large bets at the end of the year. Many of the desks are manned by junior staff while the big bosses head out for their holiday vacations (EverBank WorldMarkets included). But for the first time this week, we will have a pretty good bunch of data releases here in the US, so we could see a bit more action in the markets. With thinner trading volumes, a rogue piece of economic data can have a major impact on the markets.
[Read more...]US Dollar Rallies on Safe Haven Buying and EU Debt Crisis
December 20, 2010 by Leave a Comment
Worries over the sovereign debt crisis have pushed investors out of the euro (EUR) and into the US dollar. The “risk� trades have been pulled off the table, and investors are seeking shelter in the relative safety of the dollar. I had a reader ask me what I was looking at on Friday when I wrote that the euro had ticked higher versus the US dollar. Apparently I need to remind everyone that I write this at around 5 AM, so when I talk about the euro moving higher, it is in the early European trading. On Friday, the early euro strength was quickly reversed as the US trading desks took the dollar higher.
[Read more...]Euro Rallies After EU Summit Sgreement
December 17, 2010 by Leave a Comment
Last time I sat in for Chuck, the markets took us on quite a ride; but with the end of the year within sight, and most of the trading desks short-staffed, I don’t think we will see a lot of big positions being put on the books. Should be a fairly quiet couple of weeks to end out 2010… (Chuck would tell me I just jinxed any hopes of lower volatility!!)
[Read more...]Strong US Retail Sales Equals Stronger US Dollar
December 15, 2010 by Leave a Comment
A chill came over the currencies and metals yesterday, which was about right, when you take into consideration the trading patterns of the past month… Two days risk on; two days risk off, and so on… This time though, the risk off that began yesterday mid-morning, looked to me to be a fundamental move… What? Fundamentals driving currency movements? What, has the world gone crazy? Well… It certainly looked that way… And it all began with the printing of US retail sales…
[Read more...]
US Dollar Rallies as FOMC Sounds the “All Clear Horn�
Well… The rally for the euro (EUR) didn’t have strong legs yesterday. Seems that a strong Factory Orders number here in the US got everyone thinking once again that the all-clear horn has been sounded for the US… The dollar rallied, commodities sold off, and gold lost $34 (as I left for the day). I’ll just say this about the all-clear horn being sounded… If things were so rosy, would the Fed/Cartel/Bernank, be leaving interest rates near zero? Why would the same crew be carrying out their implementation of quantitative easing?
[Read more...]Click for detailed story