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EUR/USD — Daily Forecast Technical Analysis — July 6th 2015

In this video the trader guy looks at currency pair EUR/USD pair for the upcoming July 6th session.
EUR/USD — This is probably going to be one pair that everybody is paying attention to. So that’s why I chose to do the video. Quite frankly this is probably the most dangerous pair on earth right now. With the Greek referendum coming on Sunday and we are awaiting the results, I look at the possibilities and looking at this market as kind of forming a little bit of an upward sloping channel, maybe struggling at the 1.15 level. I think that is a massive barrier. Once we break above this level I think then the market continues to go much higher. But remember trend change is a pretty messy situation and let us look at what could happen.
If we get the austerity vote of ‘No’ then it could be very negative for the Euro in the short term which means Greece could be out of the European Union. Ultimately that is actually a good thing because Greece situation clears off and at that point I not only expect a rally but a long term trend change. But it is not going to be easy but possible. If we break the channel and fall below 1.10 then 1.09 is my target.
On the other hand if we get a ‘Yes’ vote then we will go higher. Either way I am a buyer of the Euro.

Investing in Gold

Gold has traditionally served as a hedge or financial safety blanket for investors worried about rising inflation and global uncertanity. Shelly believes that the rate of inflation will accelerate in the coming years and this will increase the price of gold. One option is to buy physical gold from a reputable dealer of a bank. Many sellers specialize in gold coins or bars of gold that closely track the price of the metal itself. Many investors like the assurance of possessing, shelly is worried about the safely storing large amounts of bullion in her home. Instead she decides to invest in an exchange traded fund or ETF that specializes in gold. Each Share she owns corresponds to a specific amount of gold owned and stored by the fund. Shelly likes the fact that she does not have to handle the gold herself. She has the freedom to sell her shares on the Stock market at any time of the day. However you don’t have to buy gold or a gold ETF to take advantage of the increased demand for gold.
For example if Shelly wants to increase her risk to reward profile she may decide to invest in companies that mine for gold. Typically the value of mining stocks move in the same direction although fluctuations tend to be more drastic and could be due to other factors such as new discoveries. This is particularly true for small mining firms. Individuals choosing to invest in mining operations don’t need to invest in just 1 company. They can moderate the risk by pursuing ETFs that specialize in larger mid size companies as with any investment. As with any investment keeping a proper balance is key. Most advisors recommend that gold take up no more than 10% of your portfolio.

Daily Forex News and Analysis — July 5th 2015

Following today’s upcoming Greek referendum the EUR/USD saw positive movement before market close jumping up by 30 pips to an exchange rate of 1.1114. The Euro’s positive movement did not have the same effect as the GBP/USD. The pair slipped by 0.25% which is a 39 pips drop leading to a rate of 1.5570. North American pairs fared better this 4th of July weekend. The USD/CAD jumped up by 0.27% increasing the rate by 34 pips to 1.2574. Continuing its upward movement from last week Gold recorded positive movement before market close. An ounceo of COMEX Gold went up by 0.37% to a market price of 1,167.80. COMEX was closely followed by Gold Spot with a 0.21% jump bringing the price up to $1,168.70 an ounce.
Oil took a hit last week. A barrel of West Texas Intermediate dropped by 2.48% bringing the barrel price further away from $60 mark with $55.51 per barrel price point. WTI was closely followed by Brent Crude with 2.82% slip dragging the price down to $60.32 a barrel. Major US Indices also took a hit this last week. The Dow dropped by 0.16% to close at a market value of 17,730.11. The S&P 500 dropped by 1.76% down to a value of 2,076.78. The NASDAQ dropped by 0.08% on market close to bring the index value down to 5009.21.

Boye — Bond Markets and Greece

There is a sense of calm before the storm in the bond markets ahead of 
the Greek referendum on July 5th, when voters will decide on whether
to accept or reject the terms of a proposed bailout for Greece, says
Saxo Bank’s Michael Boye.
Michael Boye: Well, there is certainly a very cautious tone in the Bond Markets today ahead of the very crucial vote in Greece. Bunds have been trading softly this week, actually down from the spike from Monday morning, so indicating to us that an underlying calmness or a tone of expectation of a ‘Yes’ vote or a peaceful solution. Markets are expecting Greeks to vote ‘Yes’.
If we get a ‘Yes’ vote it could lead to Greek Government to resign and that could be very positive for markets. If we get a ‘No’ vote then all bets are off and its a unchartered territory from there. The ECB is due to review funding for Greek banks. So expect a lot of volatility in the Financical markets if Greek votes no. But uncertainity to remain if Greeks vote ‘Yes’.

Mutual Funds vs. ETFs

Mutual Funds and Exchange Traded Funds are 2 investment vehicles that can add diversification to a portfolio. ETF is a security that tracks Index, Commodity or combination of assets such as Index fund like trades on a Stock exchange. Mutual funds on the other hand are a collective investment tool that pools money from investors to buy securities such as Stocks, Bonds and Money market instruments. Both bonds are often intended to mirror or beat a benchmark such as S&P 500.
However ETFs tend to have lower fees than Mutual funds because ETFs are less closely managed and are generally designed to mimic and index rather than beat. Mutual Funds and ETFs also differ in tax implications when managers sell shares from Mutual Fund all shareholders bear the tax burden regardless of Mutual Fund performance. However ETFs create and redeem stocks resulting in little to no tax incurred until the investor sells the fund. These are just 3 of the many differences between Mutual funds and ETFs. But remember these factors when researching the performance history of specific funds. These differences may have a big effect on your expected returns as well as the ability to liquidate your positions.

O’Hare — Greece and Gold

Steve O’Hare is setting shorts in Gold based on his assessment that the market will move lower in coming weeks.
Steve: Today I am looking at Spot Gold. Longer term price action has been negative for 2 years. We have a downward sloping Wedge formation in the long term chart. Storming momentum indicates bullish ending Wedge formation. This should lead to a longer term recovery. However while price remains in wedge short term outlook is bearish and this is confirmed by recent price action. Last the Greek turbulence saw only a slight rally in Gold.
So rallies are seen as selling opportunities and targeting upward support line at $1,150. I am setting shorts around $1,170. Stop on this trade is $1,205. If we break below $1,150 the targets are $1,131 and $1,100.

Hansen — Gold

According to Saxo Bank’s Ole Hansen, a possible Interest Rate rise in the States could be a golden buying opportunity in the third quarter.
Ole Hansen: I actually see the timing of the first rate hike in the US as a potential move for Gold and I see that move to the upside. I know that is going to be a little bit against the general expectations but trading on uncertainity and we had this uncertainity related to US for the past 3 years. Also support could potentially come from the race volatility we are continuing to see in core Government Bond market. But also if you look at China we had a phenomenal rally in the Stock market now for the past 6 months that looks like a bubble. If it bursts it could potentially see Chinese investors back into other investments like Gold.

Hardy — EUR/USD

What are the prospects for EURUSD over the coming quarter? Saxo Bank’s Head of FX Strategy, John Hardy looks ahead.
John Hardy: In the case of EUR/USD we actually sawy some reasonable US Dollar strength in place in q2 but against the Euro it is quite weak. The Euro is quite strong for a couple of reasons. The main one being over anticipation, over positioning of arrival of QE from ECB massive QE Program. The other thing driving Euro to the upside is risk appetite and Greece situation.
The Euro does better on the downside and it is easy to sell the Euro when we were having Central bank divergences and people were very confused about the whole Q2 episode which lead to reduced positions and it favoured actually the Euro to the upside. Once the Greece situation whatever the solution proves to be in the longer run I think we are going to see falling to the downside in terms of market attention and we are looking for much lower EUR/USD in Q3.

Daily Forex News and Analysis — July 2nd 2015

The US Indices ended higher despite a drop in Energy stocks. The Dow Jones rose by 0.79%, NASDAQ by 0.53% and S&P 500 added 0.69% to its value. The US Dollar traded high against most major currencies on upbeat US Jobs data and investors remain cautious over Greece debt fiasco. Today Non Farm Employment Change is expected at 231K vs. 280K and Unemployment Rate at 5.4% vs. 5.5% previously. Gold finished lower to close at $1,168 an ounce. Crude oil dropped to close at $56.82 a barrel. The Euro fell sharply against the dollar as a resolution to Greek Debt crisis grows increasingly remote. On the daily chart the EUR/USD is trading in an ascending channel. Trading in the channel may lead the pair to around 1.15 while breaching the lower side could take it towards 1.06. The Pound slipped lower versus US Dollar on disappointing UK Manufacturing PMI report. On the daily chart the GBP/USD is holding in an ascending triangle. Breaking the lower side of the pattern could lead the GBP/USD to around 1.52 while breaching the upper side may take it towards 1.60.

Hardy — Forex Market Confused with Greece Situation

The Greek government’s decision to walk out of bailout talks with its creditors, and call a July 5 referendum on the bailout terms, have left FX markets very confused, says Saxo Bank’s John Hardy.
John Hardy: I think it shows a couple of things. First the markets look very confused and unsure what to do. We don’t know what is going to happen with this referendum and what the implications are going to be. It does look like ‘yes’ to bailout is favoured. EUR/USD spikes to 1.1250 after Greek talks collapse. There exists uncertainity ahead of July 5th vote on bailout. Uncertanity is what thats driving the Euro strong at the moment.
We are seeing an odd situation with intraday range quite large and exaggerated. But if you look back a few weeks we are still stuck in the same range and no trend here. When we look at the options market it shows huge implied volatility because the people are fearing we are seeing something catastrophic. We are seeing a trendless market here until we see more clarity.
To me I see it as a lose out situation for the Euro. I cannot come to any other conclusion unless the US economy suddently starts to fall off. I see it as the Euro will eventually lose out to USD. I think Euro will drop if Greece exits. Also the Euro could fall on ECB divergence from US Fed.

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