Before the start of the trading week, the People’s Bank of China reported that foreign reserves totaled $3.23 trillion in January, higher than the $3.21 trillion forecast but a drop from December’s $3.33 trillion reading. The print was the lowest foreign reserves reading since May 2012. Financial news-outlets have speculated that the drop in China’s reserves can be used as a measure to gauge the PBoC’s effort to mitigate capital flight and slow the Yuan’s depreciation. The globe’s second largest economy has been one of the primary catalysts for risk-off trading since the beginning of 2016. The markets’ are concerned about Chinaâ...
Wow, did the dollar move down this week! It dropped more than it has in quite a while. It fell 1.3mg gold, or 0.1g silver. Gold and silver bugs of course are excited, as they look at it as the prices of the metals going up $55 and 72 cents respectively. The collapse of what most think of as money—including especially said gold and silver bugs—is great fun and profitable. At least if you’re short the dollar. By the way, when we say the dollar fell we do not mean in terms of its derivatives such as euro, pound, yuan, and so on. We’re well aware that the dollar index fell from 99.6 to 97. The euro and other currencies are no more suitabl...
Daily Forex Market Preview, 02/08/2016 Following Friday’s NFP report which showed the US unemployment rate fall below the 5.0% threshold, the markets were unsure how to react. Gold retreated after the NFP release, only to regain its footing and closed at a 4-month high near 1174. With no major releases due today, the markets are likely to settle into a range as investors digest the implications of the January jobs report. EURUSD Daily Analysis                                                                  EURUSD (1.11): The resistance zone of 1.13 – 1.12 looks to...
According to Morgan Stanley’s European equity strategist, Graham Secker, we may have just hit peak bearishness. However, does that mean that a rebound in risk sentiment is imminent, or is this just the beginning of a multi-decade mean reversion, one that will seek to unwind years of central bank intervention, and push risk assets to their ex-central bank prop fair values? We don’t the answer just yet, although it seems unlikely that after one humiliating episode in recent months for the ECB, Fed and BOJ, each, they will simply pack up and go. For now, however, here is Morgan Stanley, with a summary of not only why everyone is R...
There are numerous ways for a trader to invest as well as trade the equity markets. The markets are made up of financial vehicles such as equities, ETFs and 401K. Trading equities has never been easier with the rise of online trading and investing. Today, traders and investors have the option and ability to trade the equity markets anywhere. Considering the equity markets have become more centralized traders can utilize their equity trading strategies not only in their country of origin but also in overseas markets as well. Exchange Traded Funds (ETFs) have created numerous opportunities and opened doors for those traders and investors who a...
Some people say that gold is dead. They point to deflationary pressures and a bear market that started back in September of 2011. The bulls have been wrong for years; however, that may be about to change… At present, there are multiple reasons to consider gold: Sentiment is very negative and almost everyone is underweight Supply & demand fundamentals are positive Chinese demand continues to rise Gold is a means to portfolio diversification The main risks to prices are overblown In the next sections, we will examine the bull case for gold and the risks facing it. In conclusion, we will try to answer the following question: Is this the be...
There are things that monetary enthusiasts* such as me take for granted that are not widely understood. In an email discussion with a friend and fellow monetary enthusiast it occurred to me that the treatment of interest paid on the debt held by the Fed might be one of those things. That’s the reason for this short post. The Fed currently has about 4.2 trillion dollars of debt securities on its balance sheet, about 2.5 trillion dollars of which are US Treasury securities. The interest that the Fed earns on all of its debt securities — less a relatively small amount to cover the Fed’s own operating expenses — gets paid into the General...
Here’s what to watch for in much anticipated earnings this week from Tesla Motors Inc. (Nasdaq: TSLA), Walt Disney Co. (NYSE: DIS), Yelp Inc. (NYSE: YELP), and Cisco Systems, Inc. (Nasdaq: CSCO). Tesla Motors Inc. Tesla is set to release its Q4:2015 earnings on Wednesday, February 10 after market close. Analysts are expecting revenues of about $1.84 billion, compared to $1.1 billion from the same quarter of last year, and earnings of $0.09 per share, compared to a loss of ($0.13) from the same quarter of last year. Ahead of earnings, investors and analysts alike have guidance concerns, questioning Model X and Model S demand as ...
Catch up on the weekend’s top five stories with this list compiled by The Fly: 1. Ford (F) plans to build a new assembly plant in Mexico and expand its existing factory near Mexico City, sharply increasing production capacity in the country as it looks to focus its U.S. efforts on trucks and SUVs, the Wall Street Journal reported. 2. GoPro (GPRO) and Microsoft (MSFT) signed a patent licensing agreement late Friday, lifting shares of the action camera maker in after-hours trading. 3. Media reports indicate Twitter (TWTR) could be rethinking its news feed, potentially ordering posts based on popularity rather than chronological date. 4. A...
EUR/USD finally burst out of range and rallied very nicely. Is there more in store? GDP figures stand out this week. Here is an outlook for the highlights of this week and an updated technical analysis for EUR/USD. While PMIs failed to impress, the employment situation in the euro-zone is improving, with better data from Germany and Spain. However, the big rally can be attributed to the greenback’s crash that was mostly fueled by a worrying report for the services sector. Draghi could not halt the rally. Updates: EUR/USD daily graph with support and resistance lines on it :...