Afternoon Report: 08.30
- Markets were on the back foot yesterday until the US Fed’s announcement that rates would stay low until 2014, with plans for a third round of quantitative easing. Stocks immediately rallied with the dollar plunging well into the close last night. The impact is still being felt with the dollar under pressure again this morning, though US stock market futures have eased back slightly.
- Commodity currencies are seeing the biggest follow through so far today with the AUD/ USD up another 0.46%, the USD/ CAD down 0.32% and the NZD/ USD up another 0.60% in early trading.
- The USD/ JPY is continuing to peel back from the highs after a big reversal yesterday. The pair is down 0.20% with only the AUD/ JPY extending gains from yesterday.
- Gold rocketed higher yesterday on the back of the weak dollar, hitting $1700 for the first time since December. The precious metal has eased of 0.25% this morning though.
Coming up today:
- It’s another fairly busy day today with the World Economic Forum continuing throughout the day.
- We also have UK CBI realised sales at 11.00.
- US durable goods and unemployment claims follow at 13.30 with new home sales at 15.00.
Bet Idea:
- The NZD/ USD‘s recent rally has been exceptional, but is this a sign of strength or is the pair now over bought?
- Unlike some pairs, the NZD/ USD has been more prone to extend a rally after a strong run than reverse it. This sets up a good trading opportunity.
- There may be some pullbacks along the way, so a longer time frame might be best. A good way to play this might be a HIGHER trade predicting that the NZD/ USD closes above 0.8300 in 34 days time for a potential return of 159%.
- You can find direct links to this trade idea here and here.
Summary:
Summary:
