Euro Dollar Volatility, Federal Budget Update & Key Commodity Movements with Peter Esho May 11, 2014
May 08, 2015
Euro Dollar Volatility, Federal
Budget Update & Key
Commodity Movements
with Peter Esho May 11, 2014
The big news in currency markets this week is the fall in the Euro from
some very elevated levels. We’ve basically been calling a top in the Euro
for the past few weeks that actually surprised us to the upside before it
actually started to spiral down, but it is eventually starting to correct. The
expectations in the market are, the ECB will, at some point in time, come
into the market and look to cap that elevation in the Euro against the US
dollar.
In this week’s Invast Insights client-only report, we actually go through the
DAX, which is a very key market amongst our clients. We work through
the key DAX index constituents. We show and illustrate just what impact
the high Euro has had on corporate profits for businesses like Bayer, for
example, right at the very top in terms of the largest index constituent on
the DAX.
With all that corporate news and financial impact in mind that�’s really
what’s flowing through into the ECB and pressuring the ECB to start to act
on that exchange rate. There�’s no doubt that will be the key focus for
traders in currency markets this week.
It’ll also be very important to watch the Chinese numbers, the industrial
production and retail numbers which come out this week. They will be a
major direction driver for the AUS dollar and also for commodity prices, but
we are seeing also a base being developed in the copper price which now
looks quite comfortable, with major support at 3 dollars a pound. We’re
seeing metals like nickel, for example, continuing to rally high. We’’re
seeing a flat to stable Brent Crude price, which again we�’ve spoken about
in Invast Insights this week for the technical outlook. The copper price will
be a major key market that traders will be watching over on the Chinese
data which comes out.
The Australian budget is a very topical point. It’’s a point which we’ll update
our clients on the Invast blog. We�’ll go through all the major points, but it’s
something that’s very unlikely to move the market, both the stock market
on the ASX200 index and also the AUS dollar.
We think the key focus tomorrow, on Tuesday, will be the Chinese
numbers, not necessarily the Australian budget. Make sure you tune in to
our live market analysis this week on Wednesday.
Live market analysis last week was on gold. We called the key support
levels. We think gold is looking quite comfortable at around the 1280 an
ounce level. We’’ll be updating gold and other major markets including the
DAX on Wednesday in our live market analysis.
Towards the second half of the week there’s a fair bit of news coming out
from the bank of England. There�’s also key data around inflation coming
out of Europe and there�’s also similar data coming out of the United
States. We�’ll be updating that all. With all that in mind, the Euro, the
Chinese data and the copper market are the things that we’’re keeping an
eye on very, very closely at the beginning of the week.
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