learn something

averting risk

Tue, 25 Aug 2009 15:27:50 -0600

The dollar has been going up as traders wish to avois risk. This means back to the basics and that means the dollar. Global markets are still looking to China for direction and seem to be still walking around in circles. No one's pointing out the way.

This makes the dollar very attractive. Look for continued upward movement in the weeks to come.

higher oil mean lower dollar?

Thu, 20 Aug 2009 06:55:36 -0600

I've had this notion for some time. Oil rallied yesterday (August 19) after oil inventory reports showed lower oil on hand. This news at first hit the dollar then helped oil prices it seems. Buying in equity markets was also triggered as traders are willing to take on more risk. Watch action today and tomorrow on the dollar, as this will show if the dollar will continue the down trend or start going back up.

The U.S. stock market still appears bearish.

oil under pressure

Wed, 19 Aug 2009 06:18:22 -0600

The nearby contract for light sweet crude fell under $70 per barrel and remains under pressure. The higher dollar put oil under a cloud, however U.S. economic news helped stem the selling.

dollar extending gains

Mon, 17 Aug 2009 11:58:16 -0600

Traders are avoiding risk and the place to that is in the dollar. Stock futures were sharply lower adding to the risk aversion notion. Equity markets have been hit with much bearish news which has made the dollar a safe haven for investors again. Consumer spending remains sluggish allowing many to question if U.S. economic recovery is still around the corner.

The dollar rose to a monthly high versus the sterling.

dollar up

Mon, 17 Aug 2009 07:12:13 -0600

The dollar gained on Friday the 14th with help from the triple digit drop in the DJIA. Also helping a bit was news that the eurozone is still in recession. Traders consensus is for more gains in the dollar, but they should be modest. Recovery is still the keyword. U.S. consumers still aren't spending.

dollar holds gains, but bearish tone remains

Tue, 11 Aug 2009 11:55:13 -0600

Most traders say the the gains were overdone, but nonetheless, the gained against the major pairs on the 10th. The bearish tone for the dollar remains. The 50 day moving average helped underpin the buying, but there is just too much bearishness in the dollar right now to think the rally will last.

pound takes a hit

Fri, 07 Aug 2009 06:59:41 -0600

The Bank of England decided to expand the amount of pounds to pump into the economy to the tune of 50 billion. With the news the gbp/usd fell 150 pips. The exit plan from British monetary leaders will be interesting to say the least.

Australia showed job growth and that was good for their currency.

dollar and oil supplies

Thu, 06 Aug 2009 06:33:48 -0600

On Tuesday, the 5th, the dollar was still scratching against the other major currencies. Risk appetite seems to be diminishing, but traders pulled away from going to the dollar. The dollar hit a ow against the pound it had not seen since last fall.

Oil invetories are higher, however crude is testing $72. U.S. commercial crude inventories went up by 1.7 million barrels in the previous week.

budget deficit and the dollar

Wed, 05 Aug 2009 12:06:22 -0600

Stronger unemployment numbers over the past several months will create U.S. government deficits that could be more than originally projected. Long-tern interest rates could rise as a result of the burdens of financing the deficits, even when the economy improves. Higher deficits also may make it a tough case to sell the healthcare reform and cap and trade issues.

That brings us to the next item: the dollar. what's hurting the dollar is both fundamentals and technical. With the help of the usual numbers coming in negatively and take a look at the usd index, it is no wonder why the dollar decline continues. Also knocking on the door is eroding purchasing power, inflation and stagnation well into the future. Usually a lower dollar means higher commodities and precious metals.

dollar hit, more risk taken

Tue, 04 Aug 2009 12:04:38 -0600

The dollar got hit yesterday (the 3rd of August) as investor confidence goes to the equities markets. The dollar bearishness seems to be overdone. Strength in the euro remains. The European Central Bank will most likely have interest remain unchanged.

lower gdp number hits dollar

Sat, 01 Aug 2009 14:01:54 -0600

The U.S. government lowered the estimated decline in Q2 GDP and that news hit the dollar hard. The pound still had support on its own, and with the GDP news, the big gainer was GBP/USD, which exhibited a breakout rally. A stronger risk appetite helped the EUR/USD too.

Signs of a recovery in the U.S. economy are here as most traders sighted higher crude prices and a higher Canadian Dollar as signals good for the U.S. economy.

the standard formula

Fri, 31 Jul 2009 12:08:13 -0600

Strong oil prices, strong stock prices and a weak dollar. Trend following to be sure. Will this continue? Well if my crystal ball was available. But one must note that the longer these trends drift away from the fundamentals, the more likely they will continue. That's because of capital flow and that is usually trend following.

As far as oil.... much supply and little demand. Oil companies have reported lower earnings and global demand looks to remain without recovery for the time-being. The dollar is lower taking beack gains garnered earlier in the week. And stocks....well that's your homework assignment for most of the rest of the calendar year! Do watch though for a stronger dollar on weakening equities and vice versa.

speculation?

Tue, 28 Jul 2009 12:00:46 -0600

A report came out that said the price of oil is going up because of speculation, not supply and demand. Alright, fair enough, but this happens all the time in commodities. Just that some speculation is smaller or larger at any given market trading day. But look at the oil situation for just a moment. Oil production is declining around the world. Oil inventories have dropped a bit too. But our gasoline inventories have risen. Is demand down or about the same? I'll let you answer that since I don't really know!

This I do know.... the need for oil is not going away just yet. And with production going down... well, you get the picture. I have read where one trader thinks oil is going down to $20 per barrel and I have read where another trader said get ready for a coreection in crude to about $50 per barrel and ready, set, go to $120 per barrel. Right now I go along with the latter scenario.

currency traders speculate on recovery

Tue, 28 Jul 2009 06:53:42 -0600

The dollar was weaker against a spectrum of currencies as traders speculate that global economic recovery is on target. The demand for safe-haven assets is waning. European equities found support which helped the pound.

oil linked to stocks

Fri, 24 Jul 2009 07:15:10 -0600

Oil turned sharply higher yesterday. The rally took prices to a three-week high. September light crude closed at $67.16, up $1.76. Better housing news helped the prices along. Higher global stocks helped too, since this is a signal that energy demand most likely will pick up. The Energy Information Administration reported crude inventories decreased 1.8 million barrels in the week ended July 17.

The dollar fell to an over 7 week low against the euro.

Occidental Petroleum reported their biggest find of oil and gas in Kern County California.