Currencies
- The euro (EUR) recovered part of its loses yesterday against the US dollar (USD). The single currency climbed from its weekly low at 1.3575 towards 1.3604 awaiting for more news to come out.
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The US dollar (USD) fell yesterday from 102.20 down to 101.68 against the Japanese yen (JPY). The pair dropped as US equities fell from their record highs and after Japan’s bigger than anticipated surplus on Current Account.
Equities
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European equities downsized yesterday. The Germany 30 (DAX) dropped from 10020 down to 9902, the EU Stocks 50 (ESX) went down to 3227 and the France 40 (CAC) reached its monthly low at 4402.
Commodities
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Soybeans (SOY) crashed yesterday at the opening after the US Bank Holiday recording six month low at 1270 USD cents per bushel. Soybeans fell as supply increased, boosting cooking oils imports towards record in the biggest palm buyer.
Mover & Shaker with FX Options
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Gold (XAU) dropped from 1319 to 1311 before rebounding back to 1317 US dollars per ounce. Gold is retreating from the three-month high as investors considered the timing of US interest rates.
- Option traders may consider constructing a Long Straddle on the XAUUSD and gain if the pair moves in either direction, while the risk is limited to the premium paid.
- A Long Straddle can be constructed by buying an at the money Put and an at the money Call.
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Editors’ Picks
AUD/USD could extend the recovery to 0.6500 and above
The enhanced risk appetite and the weakening of the Greenback enabled AUD/USD to build on the promising start to the week and trade closer to the key barrier at 0.6500 the figure ahead of key inflation figures in Australia.
EUR/USD now refocuses on the 200-day SMA
EUR/USD extended its positive momentum and rose above the 1.0700 yardstick, driven by the intense PMI-led retracement in the US Dollar as well as a prevailing risk-friendly environment in the FX universe.
Gold struggles around $2,325 despite broad US Dollar’s weakness
Gold reversed its direction and rose to the $2,320 area, erasing a large portion of its daily losses in the process. The benchmark 10-year US Treasury bond yield stays in the red below 4.6% following the weak US PMI data and supports XAU/USD.
Bitcoin price makes run for previous cycle highs as Morgan Stanley pushes BTC ETF exposure
Bitcoin (BTC) price strength continues to grow, three days after the fourth halving. Optimism continues to abound in the market as Bitcoiners envision a reclamation of previous cycle highs.
US versus the Eurozone: Inflation divergence causes monetary desynchronization
Historically there is a very close correlation between changes in US Treasury yields and German Bund yields. This is relevant at the current juncture, considering that the recent hawkish twist in the tone of the Federal Reserve might continue to push US long-term interest rates higher and put upward pressure on bond yields in the Eurozone.