Forex Market Commentary
Here we go again. USD slips once again to remind us how unconvincing dollar longs must be in their attempt to position for the next long march to increase the vale of the USD. PPI contracts by -1% which means that the recent hawkish stance by the Fed on rates and inflation outlook is fast evaporating and yet again analysts may have to revise their 25 basis point increment expectations from June this year, to December and now probably further out to t Q1 16. Why? Well if producer prices are falling then the rational for a rate hike depreciates with fewer reasons for inflation. of course crude oil affects virtually everything, but given that WTI is trading in a nice stable channel now 55 - 65 then expectations of commodity price inflation dampens substantially. Producers will cut prices and then retailers will follow to convince US consumers back into the market to purchase goods and services.
EUR/ USD on the bounce again not so much on the basis of Euro zone inflation potential or a Greek consensus or sturdy signs of economic growth but more so out of disinterest in the USD for the time being.
Two interesting articles appear today on Bloomberg with a similar theme of analysis.
Firstly - http://www.bloomberg.com/news/articles/2015-06-03/who-cares-about-china-s-economy-when-stocks-are-rising-this-much
So much for economic slow down in China as companies increase in valuation on the stock market, reduce their debt and look stronger than ever.
Secondly - http://www.bloomberg.com/news/articles/2015-06-03/australia-s-economy-expands-faster-than-expected-currency-gains
The second article highlights the positive changes in the Australian commodity export market to China.
With crude oil stable, interest rates low and investors piling into the Chinese markets, we could be seeing more Chinese money in the US Treasury markets keeping fixed income product prices up and interest rates down whilst the demand for the USD currency increases. In such a scenario gold bullion has only one way to go and that is lower in the short term.
EUR/ USD on the bounce again not so much on the basis of Euro zone inflation potential or a Greek consensus or sturdy signs of economic growth but more so out of disinterest in the USD for the time being.
Two interesting articles appear today on Bloomberg with a similar theme of analysis.
Firstly - http://www.bloomberg.com/news/articles/2015-06-03/who-cares-about-china-s-economy-when-stocks-are-rising-this-much
So much for economic slow down in China as companies increase in valuation on the stock market, reduce their debt and look stronger than ever.
Secondly - http://www.bloomberg.com/news/articles/2015-06-03/australia-s-economy-expands-faster-than-expected-currency-gains
The second article highlights the positive changes in the Australian commodity export market to China.
With crude oil stable, interest rates low and investors piling into the Chinese markets, we could be seeing more Chinese money in the US Treasury markets keeping fixed income product prices up and interest rates down whilst the demand for the USD currency increases. In such a scenario gold bullion has only one way to go and that is lower in the short term.
Please note that technical data should only be used as a guide but be aware that it is the fundamental data which becomes the trigger that pushes prices into equilibrium of demand and supply.
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
95.889 -0.053 -0.07%
95.889 -0.053 -0.07%
Support 94.480 Resistance 98.208
Forward 1 year - 96.945. Low growth positive line.
Forward 1 year - 96.945. Low growth positive line.
EUR
1.117165 -0.000015 -0.00%
Support 1.08157 Resistance 1.13737
Forward 1 year - 1.12540. Flat line.
Crude Oil
60.82 -0.44 -0.73%
Support 59.49 Resistance 62.47
Forward 1 year - 62.77. Low growth positive line.
Forward 1 year - 62.77. Low growth positive line.
Gold
1194.57 -0.08 -0.01%
Support 1,183.2 Resistance 1,199.8
Forward 1 year - 1,199.6 Low growth line.
Pieter Bergli - DeLoren Trust Holdings
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Forex market commentaries and media reports for free
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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
