- 
- 
- 
Welcome,
Guest!
TechnicalCentral BanksForex Brokers
Trading Tools |
Equities have ugly start to the week - carry trades pushing lower again. A very busy week awaits.
0
votes
US event risks this week include Wednesday's FOMC announcement, and Friday's Employment report and ISM. MAJOR HEADLINES – PREVIOUS SESSION
THEMES TO WATCH – UPCOMING SESSION
Market Comments Asian stock markets fell out of bed to start the week after Friday's ugly close in US markets, and this time there is no rogue French trader to blame it on. Carry trades took a hit again overnight in sympathy with the contraction in risk willingness. This week looks like a key one for the markets, as we look for a 50 bp cut from the Fed and look for further signs that the US is entering a recession as the employment report and ISM are the key data points for the week on Friday. This may be a key pivot week for the USD, as the market needs to decide whether the US is hopelessly damaging the credibility of its currency by slashing rates mercilessly, or whether it is actually at the vangaurd of monetary policy and bravely showing the rest of the world the way. We lean to the USD bullish view, but don't have the technicals in line for this view just yet. The JPY may possibly continue to correlate with the USD, so the currencies to play a USD view against, besides the EURUSD benchmark, may be AUD and NZD. The US administration and politicians from both parties are trying desperately to roll out this $150 Billion stimulus package to stem the risk of economic weakness, but before you believe that this will have a dramatic effect, recall that the US economy is very different creature this time around than it was in 2001, when the last mini-recession was underway. First, back then we were only seeing a business spending recession, as personal consumption continued to show growth even through the worst of the stock market crash. Second, the US was actually running a hefty budget surplus (ok - there's plenty of controversy on how true that is, but the books were certainly far more balanced than now.) Back then, the Fed cuts fed straight into the housing market, where there was still plenty of room for growth. In the years of strong growth since the mini-dip of 2001, however, the budget deficit first ballooned to almost -4% of GDP as new stimulus measures were introduced and then only contracted to about -1% of GDP at the height of the housing boom. This leaves the administration with little ammunition for stimulus if tax revenue shortfalls begin anew - especially with a world already awash with US debt. And the big question is how much would any stimulus work as US consumers are overextended and seeing a reverse wealth effect as their home equity disappears. We are on recession watch - let's see how bad the Q4 numbers were on Wednesday for a possible preview of future numbers. A look at this week's calendar highlights: Tuesday: US Durable Goods Orders and Consumer Confidence Next Analysis:
Content Provided by:
Saxo Bank
Company Description: Founded in 1992, Saxo Bank officially attained European bank status in June 2001 and has rapidly risen to become a strong presence in online trading over the Internet. Saxo Bank is based in Copenhagen, Denmark and was founded by joint CEOs Lars Christensen and Kim Fournais. ...
Disclaimer:
Saxo Bank A/S shall not be responsible for any loss arising from any investment based on any recommendation, forecast or other information herein contained. The contents of this publication should not be construed as an express or implied promise, guarantee or implication by Saxo Bank that clients will profit from the strategies herein or that losses in connection therewith can or will be limited. Trades in accordance with the recommendations in an analysis, especially leveraged investments such as foreign exchange trading and investment in derivatives, can be very speculative and may result in losses as well as profits, in particular if the conditions mentioned in the analysis do not occur as anticipated.  Related Products  Price: $ 49.95 Overview Adaptation is the name of the game in long term trading success. Join Fernando Gonzalez ...
 Price: $ 49.95 Overview This course is more than simple rules, this class explores and shows you how to ...
|
|
||
|
||
Which section would you like us to expand? |
||
 |
||
|
