As I turn on the currency screens this morning, I see that the euro (EUR) – which remained well bid on Friday, thus losing that trading pattern we talked about, of overnight rallies for the euro and daytime sell offs – has backed off Friday’s high… The German IFO Business Confidence was responsible for the euro’s strong bid on Friday… Last night, the euro backed off a bit… The single unit actually traded above 1.36 on Friday afternoon, when the volume was thinning. This morning, the single unit is below 1.36 at 1.3575, as I type…
[Read more...]The Best Currency You’ve Never Heard Of
January 5, 2011 by Leave a Comment
We begin today’s reckoning with a trivia question: how many möngös are there in a tugrik?
If you guessed 100, congratulations! If you didn’t know, don’t worry. The Mongolians probably don’t care either way. The tugrik, their national currency, may not be much discussed outside the world’s strangest-sounding capital city, Ulaanbaatar, but it was still the world’s best performing currency of 2010. Well, the best paper currency, anyway.
[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...]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...]Chinese Inflation and Economic Growth Soar
December 13, 2010 by Leave a Comment
Well, the pause for the cause by US Treasury yields, lasted but one North American trading session on Friday… The 10-year yield has jumped higher once again this morning, all the way to 3.35%!!! WOW! Once again, I wonder aloud if the Treasury Bubble that I’ve cried wolf about for three years, is coming to fruition, or… Is this just another head fake, that will be corrected once the FOMC begins to really pull the trigger on their quantitative easing…
[Read more...]Sorting Out the Tax Cut and Unemployment Benefits Extensions
December 8, 2010 by Leave a Comment
When I turned on the currency screens this morning, I saw that the euphoria of a currency rally, which we had talked about yesterday, had dissipated. I said to myself that it’s a case of “another day, another currency directionâ€�… It all began mid-day yesterday, with gold and silver once again leading the way…only this time the way was down! UGH! Gold was down $24 as I left for the day… It’s down another $5 this morning…
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On the Value of Information
It has become tradition at La Estancia de Cafayate for Casey Research to host an intimate conference in conjunction with the Harvest Celebration. In the most recent of the series, Bill Bonner, co-founder of The Daily Reckoning, kicked the program off with a thought-provoking discussion about the nature of information.
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