De-risking middle east (oil), limiting commander and chief powers (gold) and Australia retail sales (AUD)

Stephen Innes SPI Asset Management

Oil and De-risking the middle east

On the flip side to the middle east risk side of the equation, if the Militias honor the Theocracy request to stand down, and there is no visible attempt to disrupt oil supplies during the weekend, it may put further downside pressure on oil next week . But we may see that interplay gradual sneak onto the field today as oil prices are drifting lower in Asia in early trade

The question is, do you want to stay hedged or not for the weekend.

Limiting Trump's Commander in Chief powers

And with the house Democrats passing a measure to limit Trump's war power against Iraq, it would severely restrict his commander in chief forces. And outside of trade policy which the democrats don't disagree with and given the political gridlock in Congress, Trump could effectively become a lame-duck president, and we would see the middle east war risk premium fade to dust Not a bad thing really unless your long Gold.

Australian retail sales

Australian retail sales data for November was considerably better than expected, but this did nothing to bring AUD out of the doldrums. After a 15-pip spike to 0.687150 on the back of the data, AUDUSD came back offered. There are more pressing issues in Australia at the moment, with a sluggish domestic outlook, geopolitical uncertainty, and the devastating bushfires. For now, there is no real theme in either direction for AUDUSD while it trades, although I still like the catch up to the Yuan story.

Author

Stephen Innes

SPI Asset Management

With more than 25 years of experience, Stephen has a deep-seated knowledge of G10 and Asian currency markets as well as precious metal and oil markets.

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