Overview of the world’s major financial markets from November 27, 2014

Stock markets have been quite active on Thursday, despite the departure of US investors from trading platforms on the Day of Thanksgiving. Hong Kong’s Hang Seng (HSI) at the end of the day lost 0.78%. Britain’s FTSE was down 0.09%, but the German DAX added another 0.6%, to pick up very close to the 10,000 mark.

Foreign exchange market on Thursday preparing more to the US Thanksgiving Day than to economic news. Care from the financial markets to US investors ‘long weekend’ has caused profit-taking on current positions and provoked a stronger dollar after sales environment on the rather weak economic reports. USD / JPY has gone to the area of 117.30, from which in the middle of the day to correct closing trading near 117.70. EUR / USD was forced to surrender so heavily recruited position and slide down to 1.2464, and even stronger-than-expected data on the labor market in Germany were unable to bounce back above 1.25. GBP / USD back below 1.58, completing trades near 1.5740. A USD / RUB strongly shook in response to a sharp drop in oil prices: a pair with the auction said 3-week high at 47.83, and then the rest of the day was adjusted down, but finished trading near a new record high 48.80.

OPEC summit was late all day was left to investors, causing oil prices to update more than a 4-year low. The fact that members of the cartel not only decided to decline in production, but did not even hint at what will be monitored for compliance with the standards of current quotas, Brent has fallen off to a minimum $ 71.24 per barrel, unprecedented since July 2010 . By the close of trading days asset returned to the area of 72.70.

Precious metals showed a decline from current levels under the influence of renewed demand for the US dollar. XAU / USD slipped to the area of 1,190.70 an ounce at the close, and XAG / USD was trading around 16.20 to a close Thursday.

Forecast for Friday, 28 November

Stock market

The German DAX index continued to move up only reinforce our expectations for emergency technical correction. Recall that in favor of such an outcome speaks several arguments:

The proximity to a strong «round number» 10000, in the area which can be located a large number of sellers.
The growth index has been going on 9 consecutive trading sessions, which was not observed in October of 2013.
The absence of US investors in the markets due to the «long weekend» may create conditions of increased volatility in the background «thin market».
In this situation, it makes sense to combine the two trading strategies: short shorts in anticipation of correction in the area of 9800 and the possible movement in the area of 9670 in case of breakdown, as well as long-term longs when the more attractive levels to enter the market.

Commodities

Now that OPEC has taken a clear decision not to change anything in the current crude oil production, energy wounds plunged into grief. The main problem lies in the fact that at the moment, in fact, the possibility to influence the price of oil is limited.

Firstly, most of the oil-producing countries are simply not willing to lower production due to its internal budget problems (as in the case of Venezuela, Nigeria, Ecuador and Russia). Here we are talking about all the players in this market, and not just about the cartel, since now there is talk that Venezuela and Russia will negotiate about the situation. In addition, Iran and Libya only returning to the market and has not even increased their capacity to previous levels.

Secondly, the growth rate in Europe and Asia are highly questionable and, therefore, energy consumption can fall further.

Third, it is a struggle for market share. Saudi Arabia, as well, and all the other players are not ready to reduce the quota because of the fear that they will be replaced the United States, which has six times increased their production volumes. Moreover, the current price for the American project is acceptable and will remain so until the $ 60 per barrel.

Thus, OPEC took the only possible solution — wait when the price will drop so that the United States would have to curtail some of the projects, or when China and the eurozone will come out of a period of stagnation and start to gain momentum. Under these circumstances, for the purpose of Brent in the coming months could be around $ 60 a barrel with a serious obstacle at $ 66.50.

Foreign exchange market

USD / JPY pair behaves quite interesting lately, as she has to choose from «two evils.» The fact is that the further growth of above 119 is not so easy to implement without any serious argument in favor of a further weakening of the yen and the US dollar strengthening. To date, the Bank of Japan has already done and hinted at additional stimulus to the maximum, and the Fed has signaled that he is ready to move to higher rates in the first half of 2015. New reports that have said that the US could easily decide to tighten in the coming quarters is not received, and did not seem to go in the near future. All of this leads one to believe that local maxima of the pair have achieved impressive and correction in a case of Japan, strong data not excluded. If we are right, the current support 117.30 can be broken in the coming days, and target the 116.50 mark.

For USD / RUB Thursday was enthusiastic, as after a long period of steam once again noted a record high. However, prices are not too high departed, leaving the area 48.60 strong resistance on the way up. Now that oil prices could put pressure on the couple for an extended period, it is possible that the Bank of Russia once again have to intervene in the dynamics of the ruble. The market realizes this. It is with this understanding, we believe that surges up the pair will be accompanied by an equally sharp downward correction as long as the pair can not find equilibrium rate and enters consolidation.

Твой выбор

Search

The best broker

Link to Us



Overview of the world's major financial markets from November 27, 2014 | Web Trade For All - Forex trading, analytical reviews of the market and help for beginners