Currencies
- The euro (EUR) dropped down to its 14-month low at 1.2763 against the US dollar (USD). The single currency fell below 1.28 as German Business Confidence declined more than expected amid speculation that the ECB may add further stimulus measures.
- The US dollar (USD) climbed all the way up to 109.33 from 108.48 against the Japanese yen (JPY). The yen depreciated further as Japan’s target is to increase inflation up to 2%, while at the moment it failed to boost export volumes.
Equities
- The US indices rallied as the US New Home Sales came out better than expected, adding to the US economic growth. The US 500 (SPI) climbed from 1970 up to 1992 and the US Tech (NDQ) rose from 4032 up to 4089.
Commodities
- Natural Gas (NGS) climbed from 3.791 up to 3.969 US dollars per mmBTU. The energy rose as today the Energy Information Administration will reveal how many cubic feet held in the underground storage for the commodity, as expectations are at 98 Billion cubic feet.
Mover & Shaker with forex options
- The New Zealand Dollar (NZD) recorded a yearly low at 0.7982 against the US dollar (USD). The kiwi dropped below 80 cents after the Governor of the Reserve Bank of New Zealand (RBNZ) stated that the currency level cannot be justified and is unstainable. We may see an intervention from the RBNZ in the near term and the pair may move even lower.
- Option Traders may capitalize on the bearish momentum of the NZDUSD and purchase a PUT with the risk limited to the premium paid.
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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.