Nervous Sentiment & Volatility

05-09-2011

The U.S. will be on holiday today which will affect trading volumes profoundly in the broad markets. Asia started off on a negative bent this morning following through via the declines from the States on Friday. A poor outcome via the U.S. Jobless numbers sent a cold shiver through the hearts of investors. Fear is growing that the American economy is now sputtering towards another recession. There were mitigating factors in the Non Farm Employment Change numbers due to a large labor dispute within Verizon Corporation last month. The work stoppage has been resolved and jobs added will show up next month, but it might not be enough to improve the core number. Adding fuel to the fire is the ongoing wrangling from the E.U. regarding Sovereign Debt and its financial institutions. Policy makers from the continent are openly clashing and long term resolutions are being debated publically. With the U.S. celebrating its holiday it is the Europeans that will be the overwhelming focus today.
This weekend Angela Merkel suffered another election defeat within her home state in Germany as she watched her political party take a beating. This underscores that the population of Germany does not agree with current policy and may mean that it will be hard to find a uniformed front in Europe no matter how many policy makers wish it were so. The EUR lost steady ground to the USD on Friday and its outlook remains unsure. It should be noted that the EUR is at the lower end of its range against the USD. It will be more than interesting to see how the EUR performs this week. The ECB has its monetary policy meeting this Thursday and after actually raising interest rates recently, it will be critical to see how the ECB confronts the near zero growth data that is being reported by many nations.

Gold climbed to near record highs on Friday and going into this week will have many interested participants. Certainly there is speculation taking place within the precious metal, but there can be no doubt that many investors are using Gold as a safe haven avenue. As of this morning Gold is around 1878.00 USD. The AUD did lose value on Friday and should remain an attractive trading front. The AUD climbed and consolidated near short term highs last week, but as soon as the bad Jobless number from the States confirmed fears of a weakening economy the Australian currency reacted with a decline. If the global economic picture remains poor the AUD will continue to present opportunities. The JPY remains in a stubborn consolidated range.

Crude Oil faced headwinds on Friday as investor reacted to the bad economic data in the U.S. and the commodity will likely continue to find a tough road. The Europeans will see the Sentix Investor Confidence reading today, the U.K. will publish Services PMI. The U.S. will obviously be shuttered, but tomorrow will release ISM Non Manufacturing PMI numbers.

The GBP continued to follow the EUR on Friday as it was taken lower. The EUR centric mode remains strong. The Sterling is at the lower end of its range and the like the Single Currency it will face a true test this week to see if it can bounce off of its lows. The holiday in the States will create an opportunity for traders willing to participate today. Though the markets should be relatively quiet, there is enough nervous sentiment around to help spur on sudden volatility. This week will certainly prove interesting as traders come back from their holidays.

Trends Reverse…Slightly 17-05-2012

The Euro is up slightly against the greenback during early European trading on Thursday, but remains far below levels from two weeks ago. The EUR/USD is up 0.18% and trading at 1.2739 this morning, rebounding from a 0.10% decline during yesterday’s trading in the United States that saw the pair close the session at 1.2717. The Dollar is [...]

The Collapse of Oil Prices Continues 16-05-2012

Early trading on Wednesday saw a continuing trend of investor concern towards the Greek political crisis and a rush to the greenback. With the chance of Greece leaving the Eurozone more likely with each passing day, the Euro continues to struggle against the Dollar. The EUR/USD is down 0.11% in early European trading this morning, at [...]

European Uncertainty 15-05-2012

The U.S. Dollar was up against most major currencies on Monday, as investor uncertainty regarding the Greek political crisis continued to push investors towards the safe haven of the greenback. The Euro is up slightly at the beginning of the European trading session on Tuesday by 0.05%, sitting at 1.2828. The Euro has declines sharply [...]

Euro Falls Once Again 14-05-2012

Political uncertainty in Greece and mass protests in Spain has pushed the EUR/USD down 0.15% to 1.2897 during late Asian trading on Monday. In fact, the greenback was either steady or up against most major currencies as traders searched for a temporary safe haven in order to dodge uncertainty in the markets. The increased value of the [...]

Time Is Ticking For Greece 11-05-2012

The Euro is back on the decline during Asian trading on Friday, with the EUR/USD down 0.14% and trading at 1.2920. The pair continues to hover at around 1.3000 after the single currency took a major hit due to fears surrounding political instability in Greece and future fiscal policy in France. The pound is also down against the greenback [...]

Euro Declines Stop 10-05-2012

The Euro has rebounded slightly against the USD during Asian trading on Thursday after posting huge losses over the last several days. The EUR/USD is up 0.15% and trading at 1.2946. The majority of major currencies are also up against the greenback this morning, including the Pound, Swiss Franc and Australian Dollar. The Aussie posted [...]

Euro Decline Continues 09-05-2012

The beginning of trading on Wednesday continued the negative trend of the Euro and oil. The Euro continues to decline sharply, down 0.24% and trading at 1.2975. The EUR/USD broke through the 1.3000 barrier earlier this week after European elections in France and Greece cast a shadow over the future of the single currency. The Euro is also [...]

Declines Continue for Oil and Euro 08-05-2012

The Euro is down once again during late Asian trading on Monday, after suffering huge losses yesterday. The EUR/USD is down 0.15% and trading at 1.3032. The single currency did manage to recover somewhat during late trading yesterday, rebounding from a decline of 0.81% at the end of the Asian trading session. Investors continue to show [...]

Future of the Euro in Doubt? 07-05-2012

Two key election results in the European Union are threatening to undo the single currency. Francois Hollande is the new president of France, after defeating Nicolas Sarkozy by a small margin in the second round of elections. Hollande is the first socialist president in France in the last seventeen years. Many voters in France expressed [...]

Oil Prices Plummet 04-05-2012

Oil prices plummeted during the U.S. trading session on Thursday after European Central Bank President Mario Draghi expressed concern over future growth of the EU economy. The price of crude was down 2.48% and trading at 102.61 USD per barrel. Oil was also hit hard because Draghi claimed that ECB was not planning to increase liquidity in [...]

Go Back