Weekly Analysis

IB FX View: Andrew Wilkinson, Senior Market Analyst

Wednesday 7th January 2009

When the President speaks, everybody listens

Last week as we wrapped up our analysis for the year, we noted that with the euro buying $1.40 at the time, its reversal from $1.4719 signaled a drop to $1.35 “for the first week of January.” The ensuing slide to as low as $1.3317 ushered in by a New Year dollar buying frenzy proved the point that the fat lady hasn’t yet inhaled . . . more

Daily Market Analysis & View Points

Market Comments: Alex Dunn, CaxtonFX

Alex Dunn, Head of Trading at CaxtonFX, is the latest industry expert to be featured on FX&MM.  Alex's commentary will add to the panel of daily market news added each day to this and the Banking webpages of www.fx-mm.com.

Alex Dunn's daily commentary is coming very soon, until then please scroll down to catch up with today's commentaries straight from the experts. 

Click here to play the CaxtonFX Big Euro Game

Market Comments: Lena Manousarides, Spikecharts.com  
      
Crunch Time for the Dollar!

The big day is here, with markets trading within tight ranges waiting for the BIG number to hit the news in a few hours! The dollar has lost all of the gains it printed at the beginning of the week and now trades between 1.3650-1.3750 since the European opening. There is a certain feeling amongst traders that today’s number will shake and stir things even more, as it is expected to again be -550.000 which will make over a million jobs lost . . . more

 Market Comments: John Hardy, Saxo Bank

Market Comment:

With minds firmly concentrated on the US non-farm payrolls numbers this evening, FX activity proved considerably muted in Asia, exacerbated by the looming long weekend in Japan.

After Weds’ ADP employment report set the scene, analysts are bracing for a dismal number, and a number above 600k is now being bandied around . . . more

Market Comments: Mark O'Sullivan, Currencies Direct

A Very Definite Shift in Emphasis ……

..from the MPC in the statement that followed the announcement of a further 50 basis point cut in UK rates agreed at yesterday's meeting.

At the December get together, at which, you will remember , the decision was made to cut rates by 100 basis points but the discussion was centred on whether this was enough . . . more

Market Comments: Jonathan Griffiths, Raphaels Bank

Sterling Proves Oversold as BOE Trims by 50bp

As speculated in our most recent report, Sterling fared well across the board in currency markets yesterday.  A drop of 50bp in the Bank of England base rate to an all-time historic low of 1.5 per cent, being precipitated by a high degree of uncertainty in markets, actually spurred some small Sterling strength, especially against the Dollar which reached a high of 1.5375 at one point  . . . more 

Articles & Features

Risk & the volatility vortex!

`A man is nothing but his mind; if that be out of order, all is amiss, and if it be well, the rest is at ease'. Girolamo Cardano Of course, we all know that the Italian Renaissance mathematician, physician, astrologer and gambler, Gerolamo Cardano, invented a type of universal joint and investigated the mathematics of probability… right? 

It's a hard knock life!

Not many people outside of the likes of Warren Buffet get to make too much money out of a Wall Street crash. But eerily reminiscent of recent events...

The good ship 'Economy' heading for the port?

Having sailed though a month of storms since our last round-up, its official: weve now run aground in the most turbulent financial seas since the first use of the expression Credit Crunch was coined. Having weathered the extreme volatile markets in July and August, with unwinding JPY carry trades, the weak EUR, collapses of the oil prices, and the GBP, AUD, NZD up down like the proverbial brides night gown, not to mention cable collapsing over 1,500 pips to its lowest close in last 2 years. 

Is the end nigh?

The Japanese Yen carry trade has been the centre of much debate over the past two years, but for good or for ill there are signs that it may well be coming to an end. The first indication that the carry trade could be in jeopardy appeared this time last year when the US subprime disaster hit the markets very hard. This immediately sent a warning shot across the bows of those who had sought cheap financing in Yen and invested it in higher yielding assets denominated in other currencies, mainly U.S dollars.

Long or Short the MXN

The global markets have been in somewhat of a tailspin the last several months due to a windfall of events. Problems stemming from the credit crisis and rising inflation have put severe strain on some of the largest economies in the G10. DP has contracted on an annual basis in the US, and the trend of slowing growth has spread to neighboring countries. Foreign Exchange captures the full scope of a country's economic health through the concept of relative value

Currency News