Analysis Topic: Currency Market Analysis
The analysis published under this topic are as follows.Sunday, August 10, 2008
Spreading Global Economic Weakness Is Positive for US Dollar / Currencies / US Dollar
Jack Crooks writes: Yesterday, the dollar rallied hard against the euro. And today I want to tell you what I think is happening. Let's start with a question ...
What happened to decoupling, the idea that other economies were immune to weakness in the U.S.?
Read full article... Read full article...
Saturday, August 09, 2008
U.S. Dollar Soars Triggering Major Currency Breakouts / Currencies / US Dollar
Bloomberg is reporting Euro Falls the Most in 8 Years on Reduced Bets for Higher Rate .The euro fell the most in almost eight years, pushing the currency to a six-month low against the U.S. dollar, as traders pared bets the European Central Bank will raise interest rates as the economy slows.
The euro dropped below $1.50 for the first time since February after ECB President Jean-Claude Trichet yesterday said economic growth will be "particularly weak'' through the third quarter.
Read full article... Read full article...
Friday, August 08, 2008
US Dollar Bottoming? / Currencies / US Dollar
Is the recent upward movement in the dollar a signal that it has bottomed out, and will now move back to a higher level? Or is it just a bull trap for those who are long the dollar?
Despite reports of cheaper prices for international travelers to the States due to the depreciated dollar, it would be wrong to safely conclude that U.S. goods are now so cheap at the existing exchange rate that the dollar must appreciate from its current level. Overall the price of American products is still too high to ease the massive trade imbalance between the U.S. and the rest of the world.
Read full article... Read full article...
Friday, August 08, 2008
ECB Rate Freeze Boosts US Dollar Long-term Trend Change Probability / Currencies / US Dollar
Bloomberg is reporting Euro Slumps to Five-Month Low on Reduced Bets for Higher Rates .The euro slumped to a five-month low against the dollar as traders pared bets that the European Central Bank will raise interest rates due to a slowing economy.
The euro also fell to a three-week low versus Japan's currency after ECB President Jean-Claude Trichet said economic growth will be "particularly weak" through the third quarter. The dollar headed for its biggest weekly gain against the yen in almost two months as oil dropped 18 percent from a record. The Australian dollar declined for a ninth day, the longest stretch since 1980, as futures show the central bank will cut borrowing costs this year.
Read full article... Read full article...
Friday, August 08, 2008
Euro and US Dollar Headed Lower as Yen Carry Trade Continues to Unwind / Currencies / Yen Carry Trade
An Elliott Wave 3 Down Commences In The EUR/JPYThe EUR/JPY fell lower today on increasing risk aversion to Lehman Brothers, Merrill Lynch, AIG, Fannie Mae, And Freddie Mac. It also fell lower with a massive sell off of the Chinese stocks.
Today's fall in the EUR/JPY has set in motion an Elliot Wave 3 Down in this currency pair, which will now cause disinvestment from stocks globally, not just from the BRICs, like it has been doing.
Read full article... Read full article...
Tuesday, August 05, 2008
US Dollar / Crude Oil Inverse Correlation Returns … / Currencies / US Dollar
Over the last year or so almost everyone’s been pointing to the inverse relationship between the US dollar and crude oil. In a special issue of Currency Snapshot we included a chart that showed the recent breakdown of this correlation. Here’s an updated chart:Read full article... Read full article...
Monday, August 04, 2008
US Dollar Bullish and Bearish Scenarios / Currencies / US Dollar
Jack Crook writes: You can never actually know for sure what's going to happen on any given day, in any given market. And it's thinking you do know that can get you into real trouble.
Instead, you should think about the markets in terms of probabilities. I believe that is the real key to successful trading.
Read full article... Read full article...
Saturday, August 02, 2008
'EURANIUM': The Weaponized Fiat Currency / Currencies / Fiat Currency
Like its metallic counterpart, the euro currency has the tendency to make other currencies it comes into contact with more like itself – radioactive. The inevitable result is the death of (natural) national currency systems.
The Nature of the Euro-Beast
The euro’s architects have recognized that the worldwide dollar-reserve system cannot be sustained. The reason: The US Fed’s dual – and conflicting - mandate of price-stability and full employment. The Fed was sold to Congress via the ‘hook’ that it would allow Congress to both control inflation and maximize employment if only Congress would agree to set up this version of a central bank in the US.
Thursday, July 31, 2008
Central European Currencies Running Out of Steam / Currencies / Euro-Zone
The three major currencies of central Europe have appreciated strongly against the euro so far this year, boosted to varying degrees by rising interest rates, strong economic growth, and positive investor sentiment - the latter buoyed by the final confirmation that Slovakia will adopt the euro next January. However, there are some preliminary signs that the region's strong growth rates are about to slow. Interest rates may be at their peak in Poland and Hungary, and a rate cut may be in the cards in the Czech Republic. All of which suggests that the Polish zloty, Czech koruna, and Hungarian forint may also have peaked for now.Read full article... Read full article...
Sunday, July 27, 2008
Crisis Currencies Poised to Surge as Frightened Capital Flows from Risk to Safety / Currencies / Forex Trading
Jack Crooks writes: On various occasions in the past couple months, my editorial has tried to bring to light some of the bright spots, or shall I say "relatively less dark spots", in the U.S. economy.
Ultimately, I've tried to connect it to the dollar and its potential to temporarily buck (pun intended) its long-term bearish trend. Sometimes I've had it right, for a little while anyway, and other times I've had it wrong, or at least the market told me I did.
Read full article... Read full article...
Saturday, July 26, 2008
Buy $100 Billion Note on Ebay / Currencies / Emerging Markets
Full marks for eBay entrepreneurs for stepping in where forex traders have lost count of the zeros being added to the Zim dollar every few days. This is amid Zimbabwe's dizzying rate of inflation – officially quoted at 2.2 million per cent, but thought actually to be in the region of 12.5 million percent!Read full article... Read full article...
Wednesday, July 23, 2008
British Pound, Euro Racing Lower Against a Resurgent US Dollar? / Currencies / Forex Trading
The story so far this week was fired up yesterday via dollar positive comments from Treasury Secretary Hank Paulson (same old stuff) and monetary policy comments from Philadelphia Fed President Charles Plosser.
Bottom line: the US dollar zipped higher and is continuing its rocket-ride today.
Read full article... Read full article...
Tuesday, July 22, 2008
Will the Euro Escape the Maladies Inflicting the U.S.Dollar ? / Currencies / Euro
Last week all was well, as no less a person as Paulson, the Treasury Secretary reassured us all that Fannie Mae and Freddie Mac were sufficiently capitalized. Last weekend a plan was put into effect to ensure their survival. The second largest bank failure ever in the States Indy Bank went bust. Many believe that we will see up to 150 U.S. banks go down in this worsening credit crunch.Read full article... Read full article...
Tuesday, July 22, 2008
Collapsing Fiat Currency In Need of a Golden Parachute with a Silver Lining / Currencies / Fiat Currency
Money served throughout history as a medium of exchange and as a storehouse of value. But when gold and silver coins were replaced by paper currencies, money no longer was the same. Paper money, no longer having intrinsic value, now functions only as a medium of exchange, a function that degrades over time.
The value of paper money continually loses value because the constant printing of paper money constantly dilutes the value of previously printed money. The more paper money printed, the less paper money is worth; and today, money is being printed at a faster rate than at any time in history.
Read full article... Read full article...
Monday, July 21, 2008
Fiat Faith Based Currencies / Currencies / Fiat Currency
The Latin term "fiat" roughly translates to "there shall be". When we refer to fiat money, we are referring to money that exists because the government declares it into existence. It is not based on production or earnings, and not backed by any commodity. It is solely based on trusting the government. Fiat money is exchanged in the economy as long as there is faith in the government that issues it.Read full article... Read full article...
Saturday, July 19, 2008
Ben Bernanke has Become the Destroyer of Worlds / Currencies / US Dollar
Jack Crooks writes: I love readers' comments at the end of online articles and blog entries. I recently came across one at the end of an article regarding general Federal Reserve policy that simply said:
"Ben Bernanke is like the death star. Destroyer of worlds."
Read full article... Read full article...
Friday, July 18, 2008
Currency Traders Are Convinced Of.. / Currencies / US Dollar
... the Canadian dollar should be trading at par with the US dollar. We’re not sure exactly how traders became convinced, but this explains why we’ve seen a departure between the Canadian dollar’s correlation with commodities and commodity currencies.
At one point we’d have expected the Loonie to surge to new highs along-side crude oil and the Australian dollar. But we’ve found it just can’t shake the tight link between the US and Canadian economies.
Read full article... Read full article...
Thursday, July 17, 2008
US Dollar Final Decent - Dangers 2008-2009 Part2 / Currencies / US Dollar
Part 2 talks about the world post the USD centric world economy. It looks out 1 to 3 years ahead. Part 1 talked about the immediate dangers to the world from a Middle East war, food and energy shortages, and inflation. It looked into late 08 and 09.This part talks about what would happen should the USD begin a final decent to far lower values.
We are now a full year into the credit implosion that started with the collapse of two Bear Stearns hedge funds in Summer of 07. So many dimensions of the world economy have changed dramatically for the worse since that pivotal event…
Read full article... Read full article...
Thursday, July 17, 2008
Don't Buy the US Dollar Head Fake / Currencies / US Dollar
This week, we were treated to strong statements by both Treasury Secretary Hank Paulson and Fed Chairman Ben Bernanke about the desirability of a “strong dollar”, and the intention of policy makers to pursue strategies that will enhance its value. To the relief of many, the dollar responded to the moral support and managed a mild rally. The move is inconsequential. The harsh realities have not changed in the slightest, and the dollar is set to continue its overall decline.
Although some investors respond to such jawboning, the more sophisticated international players, who in large part determine the foreign exchange market, do not. Why the bearish sentiment despite the bullish talk from Washington?
Read full article... Read full article...
Thursday, July 17, 2008
Australian Dollar Looking Over Extended Against US Dollar / Currencies / US Dollar
There is little doubt about the powerful run in Aussie—for good reason: 1) Strong economic growth, and 2) Highest yield among the major currencies.
Most analysts believe the next stop is par, or 1.000 against the US dollar. Another panic run out of the dollar likely leads to par. But on technicals alone (granted not too useful in a fear-driven market) the Aussie looks extended and due for a breather. Risk/reward!!
Read full article... Read full article...