Currencies
- The euro (EUR) dropped yesterday down to 1.3512 against the US dollar (USD). The single currency has formed its resistance at 1.3545 and support at 1.3500 while edging lower.
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The US dollar (USD) rose from 101.19 towards 101.50 against the Japanese yen (JPY). The monthly US CPI and the US Existing Home Sales are coming ahead with expectations of at 0.2% and 4.98M respectively.
Equities
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Asian equities advanced earlier today as investors believe that the tensions in Ukraine won’t hurt the global economic growth. The Hong Kong 40 (HSX) recorded 7 months high at 23608, the Japan 225 (NKI) went up to 15407, China 50 (CNX) to 6790 and India 50 (IND) towards 7743.
Commodities
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Corn (CRN) is currently trading near its four year low at 363 USD cents per bushel as the supply increases due to favourable weather in the US.
Mover & Shaker with FX Options
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Gold (XAU) remains volatile and is now trading near 1307 US dollars an ounce, as investors are weighting the tensions in Gaza and Ukraine against the strong US dollar.
- Option traders may consider constructing a Back Spread Strategy with Puts on the XAUUSD and gain if the pair moves lower, while the risk is limited to the premium paid.
- A Back Spread Strategy with Puts can be constructed by selling an at the money Put while buying an out of the money Put at double amount.
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Editors’ Picks
EUR/USD edges lower toward 1.0700 post-US PCE
EUR/USD stays under modest bearish pressure but manages to hold above 1.0700 in the American session on Friday. The US Dollar (USD) gathers strength against its rivals after the stronger-than-forecast PCE inflation data, not allowing the pair to gain traction.
GBP/USD retreats to 1.2500 on renewed USD strength
GBP/USD lost its traction and turned negative on the day near 1.2500. Following the stronger-than-expected PCE inflation readings from the US, the USD stays resilient and makes it difficult for the pair to gather recovery momentum.
Gold struggles to hold above $2,350 following US inflation
Gold turned south and declined toward $2,340, erasing a large portion of its daily gains, as the USD benefited from PCE inflation data. The benchmark 10-year US yield, however, stays in negative territory and helps XAU/USD limit its losses.
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