Overview of the major global financial markets from November 10, 2014

Stock markets started the new week on the positive, receiving support from the financial statements of the corporate sector. Investors received positive results for the 3rd quarter, began to price the chances that the global economy can weather the current downturn without major losses. Japan’s Nikkei gained slightly more than 1% by the end of trading day, and the Hang Seng lost 1.7% on immediately rather weak inflation data in China. Meanwhile, Britain’s FTSE rose by 0.67%, the German DAX — 0.65% and the DJIA and NASDAQ also showed a small increase to the middle of the US session.

Lack of economic reports did not prevent currency pairs demonstrate impressive dynamics. Perhaps the hero of yesterday has become the Russian ruble, which released «free floating» and that it is honorably withstood. USD / RUB opened bidding for 46.39, and attempts to go up, touching 46.61, but by the close of trading in the area retreated 45.60. Meanwhile, USD / JPY reacted to falling Nikkei, down into the area 113.85, although the closure returned to the area of 114.80. EUR / USD was also able to recover slightly above 1.25, but could not get through on and rolled into the area at the close of 1.2420. GBP / USD rose up to the maximum of 1.5916, but closed in the area of 1.5850.

Oil prices showed a positive trend on the opening week, as indicators of China’s exports in October rose by 11.6% y / y vs. 10.6% forecast. This convinced investors that the growth rate of the second largest economy of the world remain high, and therefore, do not worry about the lack of demand for energy. As a result, Brent opened at 84.26, has grown to a weekly high 85.48, but was unable to hold gains and closed in the area of 83.00.

Meanwhile, precious metals were forced to hand over the position slightly after a sharp rise last Friday. Pressures on gold was the news that last week portfolio managers reduced their assets by 1.4%, marking the biggest fall in 2014. As a result, starting the day at 1174,53, XAU / USD to the end of trading days in the area slid 1150. Meanwhile, XAG / USD from the opening level of 15.73 was able to grow to 15.88, and then was forced to revert to the area 15, 60 at the close.

Forecast for Tuesday, November 11

Stock market

Spent last week’s meeting of the ECB gave investors an understanding that Mario Draghi is going to go to the end, and, if necessary, ready to implement a full program of quantitative easing. All the rumors that the chairman does not support half the council, were neutralized by the comments of the Draghi. He said that decisions are taken unanimously, and hinted that none of his colleagues had no doubt of the need for radical measures in a decelerating growth rate of the European economy. All it says only one thing — the European stock market can get a good feeding in seeing ultrasoft policy in the coming months, a fact that investors may begin to price now. Sure, it can benefit from in the first place, the European indices — of course, the German DAX, but kind and the British FTSE in connection with the partnership between the UK and the eurozone. DAX has managed to recover some of the October lows, but still far from the June highs. That area of 10,000 could be medium-term objective for the benchmarks.

Commodities

Gold prices got a good push on Friday, as the data from the US went out a bit weaker than expected. But even this weakness was enough that the precious metal is noted week high. Such a response only confirms oversold asset and its predisposition to sudden multidirectional movement. Most likely in the near future, we will continue to observe fluctuations of gold within a fairly wide range of 1100-1200 per ounce. In circumstances where an asset affects too many factors can elect tactics «were selected on the bottom — to sell on the roof.» After trying a further fall in the area of the lower boundary of the recent range XAU / USD could try again to go back to 1200.

Foreign exchange market

Ahead of the US dollar is not an easy week — all the key events that could affect its dynamics, we have received over the past few days, with a report on the labor market a little disappointed, and in fact it did, investors are very big bet. A recent cover FOMC statement made markets expect a very strong employment levels, but even a little NFP figures fell short of forecast, saying that the Fed is unlikely to accelerate the process of transition to higher rates. Published at the end of the week a report on US retail sales will be the only one worth our attention release, but this is not enough to support a new wave of demand for the dollar. Thus, we do not exclude a massive correction overbought greenback against its major rivals on profit taking. And there are several reasons:

1. Expectations for an early increase rates weakened due to the recent report on the US labor market

2. The strength of the dollar begins to annoy politicians around the world, as the pressure on commodity prices (when striking oil countries) and limits the growth of inflation. In addition, the dollar-denominated securities of emerging markets are becoming more expensive on the background of the economic downturn observed in these countries. So, are not excluded intervention.

3. Recent data futures positions for the euro say that the number of shorts on EUR / USD has reached the maximum from July 2012 levels. And this is a very serious reason to take profits on a background of the empty economic calendar for the next 3 weeks.
In the current environment, you can choose two strategies depending on the time periods within which you work. If you’re a short term trader, it makes sense to consider buying EUR / USD c immediate goal at 1.26. However, long-term investors can wait for the growth of the pair and go in shorts at these levels, as a general trend for the pair remains downward, and there will be a fairly long time.

USD / RUB may well continue downward correction, and for several reasons. Firstly, the central bank made it clear that the current speculation he just will not leave, hinting at the large-scale intervention in any most inopportune moment for investors. This will limit the number of people willing to speculate on the currency. Secondly, the Russian government embarked on a «verbal intervention». Minister of Economic Development Uljukaev the weekend said a lot to convince the markets that the ruble is already oversold, citing a current account surplus, which «will be significantly higher than the negative balance of the capital account» at the current rate. Third, as we said above, there is a possibility of large-scale correction of the US dollar in the coming days, which may also play into the hands of the ruble.

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Overview of the major global financial markets from November 10, 2014 | Web Trade For All - Forex trading, analytical reviews of the market and help for beginners