Currencies
- The euro (EUR) retraced to 1.3499 before correcting upwards at 1.3528. The European currency could come under pressure should today’s press conference by European Central Bank president, Mario Draghi, prove more dovish. The Eurozone still faces record high unemployment at more than 12% and more than 25% in periphery countries.
The US dollar (USD) rose from 98.16 to 98.73 over the short term. The US dollar will be tested this afternoon with Unemployment claims data coming out while the market mover will be tomorrow’s Non-Farm Payroll which have been delayed for a week due to last month’s US shutdown.
Equities
- The UK 100 (FTS) has managed to reach a plateau just above 6700 over the past week. The equity index has had a long term bull rally and may pick up further strength following looser monetary policy coming both internally but also from the US or Europe.
Commodities
- WTI crude (OIL) has lost more than 7 dollars per barrel falling from 100.00 dollars down to 93.20 over the course of a few weeks. Lower crude oil inventories coming less than expected gave a slight push however energy prices remain on a negative outlook.
Mover & Shaker with FX Options
- Gold (XAU) has remained in range since the beginning of the month. The precious metal has found support at 1306 and resistance above 1321 the past week. Stronger Nonfarm Payroll data on Friday could push the metal lower.
- Expecting higher volatility, short dated Gold Straddles may appreciate should the precious metal swing in any direction.
- The Straddle strategy involves buying at the money Put and at the money Call option. While keeping costs fixed, the straddle may appreciate both when the market moves higher or lower.
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