Optimism up – USD down

By GG Analyst in Reviews 0 Comment

EUR/USD

The market lingered for a while, but eventually came to the conclusion that we described in our previous review. The Fed is expected to extend QE in order to reduce the pernicious effect of the Operation Twist expiry at the end of the year and avert the possible negative consequences of the fiscal cliff.  Actually, the US congressmen are lucky to have this kind “Helicopter Ben”, who is always ready to come to the rescue and ease the pain from their own irresolution and failures. For comparison, the ECB’s head, Mario Draghi, agrees to support the financial markets of particular countries more…

Do the markets really believe that QE won’t be extended?

By GG Analyst in Reviews 0 Comment

EUR/USD

Friday’s US payrolls were quite favourable. They showed a 146K growth against everybody’s expectations that the storm would spoil the statistics and wouldn’t let the indicator go above 100K. Yet, the report was not all positive – last month’s data were revised down (from 171K down to 138K). The decrease in the work force looks disturbing. This is exactly the factor, which helped the official unemployment rate drop from 7.9% to 7.7%. Yet, it will hardly arouse any strong optimism in the market. America is still suffering long-term unemployment: on average jobseekers cannot find a job for about 40 weeks (a more…

The higher we grow, the faster we fall

By GG Analyst in Reviews 0 Comment

EUR/USD

The bears are trying to grab the markets in their paws. Yesterday the common currency didn’t have even a single chance to test 1.3140. The market reversed at 1.3125. Yet, it doesn’t change anything now. As has already been mentioned, the recent sharp upsurge from time to time stumbled upon the short-term selling, after which players again started buying the single currency. But this time the decline is smoother and there isn’t any sound reason on the euro’s side. Now it’s all about the dollar. The latter started appreciating in many asset classes. And largely it is a result of the more…

Another rise in the hope of the deal

By GG Analyst in Reviews 0 Comment

EUR/USD

The markets were quite brisk yesterday. Behind that again were Obama’s comments on the fiscal cliff issue. The president urges to complete the deal before Christmas. And now it seems quite possible as one of the republican congressmen expressed his support for raising taxes for the rich, but on condition that the tax benefits for those who earn less than $250K a year will be preserved. Such news stopped selling of risky assets. In particular EURUSD dropped as low as 1.2880 and by the end of the trading day had grown already to 1.2960. Now the market is trading in a more…

The markets go on the defensive under the “cliff” threat

By GG Analyst in Reviews 0 Comment

EUR/USD

As expected, it wasn’t easy to break through 1.30. The active European session resulted in selling the euro, partly because investors don’t believe that the EU debt crisis will be resolved now and partly because there’s no progress in the fiscal cliff issue. Difficulties on this path aren’t surprising and we spoke about this in our previous reviews. Obama seeks the support of small business to preserve tax benefits for the middle class. However, everyone understands that such benefits put a heavier burden on the rich. Republicans are against this. Probably, in the short term the markets would favour the victory more…