03 / 04 / 2017 | Technical Analysis

EUR/GBP set for Further Weakness?

EUR/GBP may still have further to fall on the downside, especially if the foray above 0.8500 is short lived. Look for moves down to recent lows at 0.8430 and then 0.8330.

EUR/AUD is trending higher and now targeting the mid-March highs of 1.4170. If this falls, look for 1.4300

This article comprises the personal view and opinion of the STO Investment Research Desk and at no time should be construed as Investment Advice.
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03 / 04 / 2017 | General

Beyond Forex - Metals, Oils, Indices, Bonds, Equities April 3rd

Our weekly breakdown of the CFD instruments that we offer beyond FOREX, including bonds, metals, agricultural commodities, indices, equities and oils. Also visit our economic calendar to learn about this week’s latest and most significant economic events.
Wednesday April 5th sees the release of the latest FOMC meeting minutes and there’s a growing disconnect between interest rates being projected by the market when compared to the narrative coming out of the Fed. In recent days the messages have been just as mixed; members are telling us that after a nine year fight the US economy is back to normal, but on the flipside, dovish undertones appear to be building. If that dovish message fails to be projected in the meeting minutes then T-bill yields could be poised to post some quick improvement.
Prices for the precious metal have been rather turgid over the last few days and any weakness off the back of a rising dollar has been rather limited. This may suggest that the real potential still lies on the upside here, especially if we seen renewed dollar weakness. This could come off the back of the FOMC minutes, or alternatively the US political landscape has plenty of scope here, too. Donald Trump is struggling to push through reforms as we also have the US budget deadline at the end of April looming. Failure to find a consensus puts the government into a technical shut down – and typically sends the greenback spinning lower too, all of which is likely good for gold.
Agricultural commodities
The USDA issues its first weekly crop report of the year at 9pm GMT on Monday April 3rd. This weekly report published through the growing season could provide some direction for assets including cotton and wheat, especially in this first bulletin if we’re seeing any notable variance from long-term historical averages.
Friday April 7th sees the release of the US non-farm payroll figure and as always this has the ability to inject some real volatility into equity indices. The numbers are out before the US opening bell, but out of hours trading on both the S&P and the DOW is available. The reactions can often be rather counterintuitive with some quick reversions being posted, so attention ought to be given to stop losses and to ensuring that leverage levels are managed in a realistic manner.
Last week we saw the eventual break down of the Deutsche Bourse/London Stock Exchange proposed tie up. Since the UK’s decision to leave the EU, this arrangement always seemed doomed but it’s difficult to see the value in the monopoly argument when presumably Deutsche Bourse will now be looking to make further acquisitions in a bid to deter other predators. Any news of hurried acquisitions could serve to unsettle investors and leave recent profits being booked.
The latest weekly inventory data out of the US showed largely predictable builds in reserves, although there were two factors worth noting. Builds were at a lower pace than had been forecast, whilst there was a draw in inventories at the Cushing storage facility. This is important because the site is nearing full capacity, so in addition to oil prices trending higher, it’s also narrowed the gap between UK and US crude prices. Trading this spread may be worth considering, given the lack of clear directional indicators elsewhere for the commodity, at least in the short term.        

This article comprises the personal view and opinion of the STO Investment Research Desk and at no time should be construed as Investment Advice.
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03 / 04 / 2017 | General

This Week’s Important Economic Events

Knowledge is an indispensable tool when trading. No matter what your strategy, how long you hold positions or your preferred currency pair, knowing what the coming week holds can help you optimize your trading. Furthermore it can help you make a more educated decision as to when to enter and exit a trade (especially if you are an intraday trader and choose to exit and enter multiple trades through-out the day).
Compared to the triggering of Article 50 last month this week’s economic events might pale in significance, but they will none the less still effect markets. Here are this week’s most important economic events.
April 3rd
  • US April 3rd 14:00  - ISM Manufacturing PMI for March
  • US April 3rd 14:00  - ISM Prices Paid for March
April 4th
  • AU April 4th 04:30  - RBA Interest Rate Decision
  • AU April 4th 04:30  - RBA Rate Statement Report
  • EU April 5th 07:00   - Non-monetary policy's ECB meeting
April 5th
  • JP April 5th 07:15   - Bank of Japan Governor Kuroda Speech
  • US April 5th 18:00   - FOMC Minutes Reports
April 6th
  • US April 6th No defined time  - Trump-Xi Jinping meeting
  • EU April 6th 11:30   - ECB Monetary Policy Meeting Accounts Report
Friday April 7th seems to be the most active day this week – with very important events coming out of the UK, US, Canada which will most probably effect global markets.
  • UK April 7th 08:30  - Manufacturing Production Month on Month for February
  • US April 7th 12:30  - Nonfarm Payrolls March
  • US April 7th 12:30   - Unemployment Rate March
  • CND April 7th 12:30   - Net Change in Employment March
  • CND April 7th 12:30    -Unemployment Rate for March
 ​This article comprises the personal view and opinion of the STO Investment Research Desk and at no time should be construed as Investment Advice.
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