Good day Koalas.
I hope everybody is feeling good today.
Yesterday, i mentioned that as the market volume was low due to the Easter holidays, the action may not be indicative of the market in general. Nonetheless, the optimism train of the US seems to gain speed as more and more indicators suggest a consistent recovery is under way.
Let us take a look at the EUR/USD.
It seems indeed that the resumption of the global markets suggest a preference for the US Dollar instead as the EUR/USD took a dive. Having tested the support of 1.3660, it seems to be taking a breather for now.
The S&P 500 remains resilient, suggesting strong optimism with regards to the US economy.
Oil is currently at $86+. With the line of $80 behind our backs, we may indeed be looking at the new phrase of recovery.
Gold is now at $1138+. Despite a stronger US Dollar, the gold price has risen a fair bit. This suggests that there may be increased demand for gold, perhaps as a result of apprehension from the Greece crisis. Gold is often a investment of choice during periods of uncertainty.
Earlier in the day, reports surfaced stating that the Greek government may be seeking means to renegotiate the terms of any potential rescue solution. This is so as to avoid the involvement of the IMF and it’s imposed terms for a loan solution.
The result was probably the knee jerk reaction that sent the EUR/USD right below 1.3400.
Most investors are concerned about the stalling or breaking down of the plans to solve the Greek deficit crisis and hence this report is certainly of much concern. The Euro is already in an unfavorable light and any more adverse news will probably cause more knee jerk reactions.
Moments ago, another report surfaced stating that Greece has denied any consideration of the idea to oppose the IMF’s involvement in the solution. while the damage has been done, this may be a window for the EUR/USD to catch a breather and consolidate.
This turn of events did cause quite a stir and it shows clearly that the forex market is unpredictable. Therefore always plan your trades.
A couple of hours later will see the release of the US FOMC Meeting Minutes. As investors will be paying close attention to any possible clues to monetary polices, do be careful of spikes. Tomorrow brings us the German Factory Order and more too.
Bullish return will bring us to 1.3400/55.
More bearish pressure will test the support of 1.3360/1.3285.
I am having a flu since Saturday and it seems to be getting worst. Arrrgghh. I need more dates with Ms Sleep.
Does anyone play Star Trek online here? I am a crazy fan of Star Trek but i can’t seem to be able to find much positive review information about it.
Take care and trade safely.