Market Highlights
Direction is Back
Greek Solution is No Resolution
Bitcoin on the Move Again
Please note: All data, figures and graphs are valid as of February 21st. All trading carries risk. Only risk capital you're prepared to lose.
Market Overview
Finally, things are moving at a normal pace again and the directionless period that we've seen since Trump's confusing conference seems to be over. Hooray!!
Here are the main contributing factors...
1. Trump has picked himself a new National Security Advisor to replace the shady one that had alleged ties to Russia. Overall, the markets see this as a good thing.
2. Hawkish comments from the Federal Reserve are boosting the buck.
3. The Greek Debt crisis has once again been swept under the rug, which is hurting the euro.
For these three reasons and more, the US dollar is king of the markets again. Here's a chart that shows the entire sequence of the last few days. This is the USD/JPY 10 minutes per candle.
You can tell that gold wants to go up but is having some trouble against the stronger dollar. Right now we're looking at support at $1232 an ounce. If it falls below that we could be looking at $1220 before not too long.
The cherry on the top of this action packed market morning is Bitcoin with a rise of almost $40 a coin and reaching as high as $1095. If it passes $1100 today it's sure to get some very welcome love and attention.
The Fed (cont)
Fed member Harker stated that he "won't take March off the table" for a rate hike and has further reiterated the plan of three rate rises this year.
Currently, the market is pricing in a 36% chance of a rate hike in March and a 26% chance of three hikes this year.
We have an additional three Fed members speaking today. Let's see if they can get those numbers up.
Greece (cont)
The Greek debt crisis is unsustainable. At the moment, the country owes more money than they can feasibly pay back.
Many were hoping for a swift resolution in Brussels before the elections in France blow the issue wide open. However, at this point, a swift resolution seems impossible and negotiations will again go down to the wire and will most likely be drawn out until July when their next payments are due.
For a full explanation of the Greek Debt Crisis, there's an excellent series on YouTube featuring Yanis Varoufakis. The former Greek Finance Minister who spat in the faces of the eurocrats and the only one man enough to tell them the truth to their faces.
What about the pound?
The first item, the Brexit debates continue in the House of Lords. It's becoming clearer that even the Lords will have trouble shooting down the proposition of Brexit or calling for a second referendum. The people have spoken and though the vote was close, it is final.
The only question now is if they want to make any minor changes or stipulations to the way the negotiations are handled.
We'll also be getting some economic data from the UK this morning as well as a speech from Governor Carney so we can expect heavy volatility on the pound today.
At the moment, the sentiment in eToro is showing 72% buying the GBP/USD and expecting it to go up from here.
Disclaimer: This content is for information and educational purposes only and should not be considered investment advice or an investment recommendation. Past performance is not an indication of future results. All trading carries risk. Only risk capital you're prepared to lose.