Front and center today, we have gold and silver piling on to their strong performance versus the dollar yesterday. Gold tipped the scales at over $1,400 yesterday afternoon, and hasn’t looked back, adding another $9 this morning! I think that Friday’s sell-off was profit-taking by the hedge funds, etc. and what we are seeing now is more of the “run to wealth providers� as more and more analysts believe that the FOMC is just kidding itself if it thinks $600 billion of quantitative easing (QE) is going to be enough!
[Read more...]PIIGS Return to the Slaughter
November 5, 2010 by Leave a Comment
Friday is finally here… The end of what has been an exhausting week here on the trade desk. The dollar continued to get beat down through most of the trading day but started to rally back a bit in the afternoon. Overnight the dollar actually gained with the highflying Nordic currencies falling almost 1% versus the greenback. The euro (EUR) and commodity-based currencies also sold off a bit, and the sharp rally in both gold and silver stalled. A break in all of the price action was to be expected, but it may not last long as we will get the October US jobs report later this morning.
[Read more...]Australia and India Raise Rates
November 2, 2010 by Leave a Comment
Yesterday was busy here on the desk, with the normal flurry of Monday trading combined with a number of calls to the desk regarding our MarketSafe CD which will be closing out shortly. But the currency markets were fairly quiet ahead of the elections today. But as I pointed out yesterday, trading yesterday was nothing more than the quiet before the storm, as the currency markets were rocked overnight with surprise rate announcements by both Australia and India. I warned you that this week was going to get interesting.
[Read more...]Get ready for a Volatile Week in the Markets
November 1, 2010 by Leave a Comment
Chuck is getting on a plane bound for Mexico this morning, so I will be bringing you the Pfennig this week. As usual, Chuck left me a note to share with all the readers last night, so heeerrreee’s Chuck:
On Friday, we saw more healing in the currencies and metals, from the price action earlier in the week. Gold jumped up $15, and I have to think that some of that gain came from the heightened risk from the packages from Yemen. I tell you all the time that we have a ton of nut-jobs running around the world, wanting to blow this up, or wipe this country off the map… But gold – with silver tagging along – will always be sought when geopolitical risks elevate.
[Read more...]US Dollar Slightly Stronger on G-20 Meeting Expectations
October 22, 2010 by Leave a Comment
The volatility we’ve seen for the better part of the week carried over into Thursday, but we didn’t have the big swings like Tuesday and Wednesday.
As I left you yesterday morning, the dollar index was down slightly and most currencies were still seeing the carry over effect from the collective appreciation of Wednesday, but things started to turn as we made our way into late morning and into the afternoon. It looks as though, at least from what I could tell, there were two drivers behind the dollar strength yesterday. It started with the data releases that showed some slight improvement, but more importantly, they didn’t disappoint.
[Read more...]Japan Agrees With US on Chinese Monetary Policy
September 23, 2010 by Leave a Comment
The euphoria in the currencies and metals carried through yesterday morning, with the euro (EUR) bumping up to 1.3425, and the Aussie dollar (AUD) bumping up to 0.9568… But the profit taking began to step in, and soon all the lofty levels that the currencies and metals had gained for the previous 24 hours were seeing slippage, and that slippage soon became hard selling.
[Read more...]Markets Think the FOMC is Prepared for Quantitative Easing
September 22, 2010 by Leave a Comment
The FOMC has opened Pandora’s Box of currency rallies and dollar sell-offs, and I’m not talking range trade rallies. I’m talking all-out, no prisoners taken, rallies versus the dollar… Let’s go to the tape!
So… The FOMC is worried… But not worried enough to implement quantitative easing (QE) RIGHT NOW. But they opened Pandora’s Box for future QE, with a statement that went like this… “We are willing to ease monetary policy further to spur growth and support prices while refraining today from expanding its holdings of securities. The Committee will continue to monitor the economic outlook and financial developments and is prepared to PROVIDE ADDITIONAL ACCOMMODATION IF NEEDED to support the economic recovery and to return INFLATION OVER TIME to levels consistent with its mandate.â€�
[Read more...]The Euro Trades Through Resistance!
September 16, 2010 by Leave a Comment
As I suspected in yesterday’s Pfennig, the dollar selling and the pause in the currency rally that was caused by Japanese intervention, has not continued… Yes, the currencies, for the most part, are back on the rally tracks versus the dollar this morning. The euro (EUR) is leading the pack, just like the old days, eh?
[Read more...]
How the US Will React to China’s Trade Surplus
What do I see front and center this morning on the currency screens? A nasty sell-off in the currencies and metals that began yesterday afternoon, carried over to the Asian markets…
Gold had lost the $1,400 figure in the profit taking yesterday, but has rallied back $9 this morning to push past $1,400 again. Silver, which yesterday morning looked like it was going to be on a straight line to the moon, also sold off in the late afternoon trading, but like gold, has rebounded in the morning trading.
[Read more...]Click for detailed story