Forex Market Commentary
In terms of price opportunity its been a poor week with lack of opportunity. A market going nowhere does not provide the wind to sail to a profitable destination. Let's start with the Dow since the US equities markets is the engine of all equities markets. Flat, nothing more to say, the Dow closes 99 points down to close at 18015.95 but retains the psychological edge over investor nerves to run for cover given the Fed's recent hawkish comments. Dow closes above 1800 going into the weekend is a pretty strong indication that most CEO's do not buy the economic conditions of inflation hitting 2% being painted by the Fed. Therefore cheap money is here to stay for some while which si a boon to consumer credit card holders to go out there and spend and help US retail sales which in turn encourages CEO's to increase inventory, increase activity and hire more people to help the economy push towards the new benchmark of full employment set at 4.3% by several economists.
In light of a weakening USD gold actually only just closed slightly above the 1200 mark on friday, making a 3 week high, and showing a strong indication that traders do not buy a USD rally at all. Period. Remember that the gold bullion market always acts as an indication of Dollar strengths or weaknesses and rises when investors think that domestic inflation is set to creep up. another issue at heart is the greek tradgedy scene where investors observing a dramatic Grexit spurs gold prices up, Dollar down and Euro currency up. but coming to the Dollar per se, certainly with cheap money and investors set to splash the cash this summer we will be looking very closely at the 2% retail price index. Moreover crude oil cannot go down because of the increased production needed for summer drives and campers as USA goes into the holidays mode and more gasoline is consumed. That in turn, together with decreasing inventory, becomes the rationale for crude oil to slightly increase to the 65 Dollar region and in turn give concern for the fed once again on watching it's 2% target for inflation. Just to note, the Fed maintained that its Core PCE inflation projection to be around the 1.3% and 1.4% mark for the moment in 2015 but the Fed has increased its forecast for 2016 to a new estimate coming in at 1.6% falling to 1.09% as if in anticipation of a an economic slow down.
The Euro zone has become enigmatic. Greece continuously bickering with bond holders over the responsibility of its debt obligations is becoming such a big yawn to bonds traders that the EUR/ USD is now staring to go up not because of any real concern about Greece but because of the actual prospects that Greece may leave the Euro currency and cease to be such a drag to the other partners in the Euro basket! The default of Greece on monday may indeed be the spark to lift the EUR now in a dramatic twist of events and traders expectations. if that happens there would certainly be a push to the 1.15 that may trigger several buy stops and short covering and thus lead to further buying to push back the dominant position of net shorts in the market.
Please read on Bloomberg how greek politicans are not add odds with their own central bank!
http://www.bloomberg.com/news/articles/2015-06-19/greece-s-ruling-party-goes-to-war-with-its-own-central-bank
Bond yields are rising convincing investors that the ECB Q.E is actually working very efficiently and fast in the markets. Annual inflation in the Euro zone rose to
0.3% in April after five months of deflation and even though that's well below the ECB's target level 2.0%, modest inflation is a storng indication of a turn around in the economy, hence the demand for EUr and the demand for Euro currency based fixed income products
Always look to support and resistance band lines as the key to understanding in the long and short term where prices are converging. Professional technical traders use 50 day and 200 day medium and slow moving averages as fundamental cornerstones for interpreting the direction of price action.
USDX
US Dollar
94.102 +0.095 +0.12%
94.102 +0.095 +0.12%
Support 93.362 Resistance 94.954
Forward 1 year - 95.233. Low growth positive line.
Forward 1 year - 95.233. Low growth positive line.
EUR
1.135400 -0.002205 -0.19%
Support 1.12513 Resistance 1.14733
Forward 1 year - 1.14770. Low growth positive line
Crude Oil
59.78 -1.04 -1.71%
Support 58.00 Resistance 61.36
Forward 1 year - 62.70. Low growth positive line.
Forward 1 year - 62.70. Low growth positive line.
Gold
1200.27 -0.58 -0.05%
Support 1,195.3 Resistance 1,207.3
Forward 1 year - 1,208.8 Low growth line.
Pieter Bergli - DeLoren Trust Holdings
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Forex market commentaries and media reports for free
Disclaimer - U.S. Government Required Disclaimer - Commodity Futures Trading Commission
Futures and Options trading involves risks of losses. No representation is being made that any reader and account will or is likely to achieve profits or losses similar to those that are being discussed on this blog http://forexeducationperspective.blogspot.com/. The past performance of any trading system or methodology discussed is not necessarily indicative of future results.
CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.
All trades, patterns, charts, systems, etc., discussed in this blog http://forexeducationperspective.blogspot.com/ are for educative and illustrative purposes only and not to be construed as specific advisory recommendations for actual trades. Disclaimer - http://forexeducationperspective.blogspot.com/ bears no responsibility for the trading actions of its readers
Pieter Bergli - DeLoren Trust Holdings
A non-profit commitment to provide education on the properties of currency markets
Forex market commentaries and media reports for free
Disclaimer - U.S. Government Required Disclaimer - Commodity Futures Trading Commission
Futures and Options trading involves risks of losses. No representation is being made that any reader and account will or is likely to achieve profits or losses similar to those that are being discussed on this blog http://forexeducationperspective.blogspot.com/. The past performance of any trading system or methodology discussed is not necessarily indicative of future results.
CFTC RULE 4.41 - HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN.
All trades, patterns, charts, systems, etc., discussed in this blog http://forexeducationperspective.blogspot.com/ are for educative and illustrative purposes only and not to be construed as specific advisory recommendations for actual trades. Disclaimer - http://forexeducationperspective.blogspot.com/ bears no responsibility for the trading actions of its readers
