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I'll be posting regular market updates from well respected Forex experts and showcasing the best Forex advice and systems, so you don't have to waste fruitless hours searching for it yourself!
Add me to your 'Favourites' now and as a special thank you, I'd like to give you 4 fantastic FREE gifts by simply entering your details on the right of this page >>>
You'll receive my 3 Part Ebook series 'The Forex Decoder' which covers everything from the history of Forex, to revealing the most consistently profitable indicators you'll need in your Forex arsenal. I've sorted the 'wheat' from the 'chaff' so you don't have to make the same mistakes as I did when I first started.
You'll also receive a copy of Mark Nelson's famous '7 Habits Of A Highly Successful Trader' which will prove an indispensible aid in your Forex career, as it has done in mine.
Just enter your details on the right and get these 4 fantastic gifts absolutely for FREE >>>
Yours 'Forexly',
Cliff
Simon Denham's Daily Market Comment
There’s
just a little bit of nervousness starting to creep into the markets and
this week has proved that the global economy is still relatively
fragile. In the US impressive economic data has been one of the driving
factors behind the recent rally, but just recently that has been
counter acted by the slowdown in China. Yesterday’s data did not help
the bulls and the big fear is that we see 2012 pan out in a similar way
to 2011. The year commenced with optimism that the recovery would
continue, but equity markets struggled to gain traction and then the
European debt crisis really started to flare up which has caused another
recession in Europe and negative growth for the UK. In the US where
equity markets have been the most impressive, the jobs data is proving
strong, however it’s yet to really translate into the corresponding
growth you’d expect as a result. On top of this the assistance from
central banks that has seen vast stimulus has assisted in this recovery,
but with so much liquidity sloshing around and incredibly low interest
rates you would expect things to be a great deal rosier. As this
correction gathers pace this morning the selling is having a respite,
although the worry is that investors have slightly had the blinkers on
and we could see 2012 turn into a bit of a 2011 with another trigger for
further selling being perhaps the next domino to fall in
Europe. Certainly Asian markets this week have been a great deal more
cautious than their European and US counterparts with some suffering
losses of over 2%.
Individuals
and companies are continuing to deleverage. Debt is now a really bad
word and so everyone is doing as much as they can to reduce their debts
which is affecting investment and spending. This is why, as mentioned
already this week, George’s gamble in his budget is that the cuts in
corporation tax and lifting more people out of tax will actually get
businesses and people spending again. It’s a throw of the dice that we
will only see settle in a year or so, so we have to wait to see whether
or not the gamble has paid off.
At
the open this morning the FTSE is trading at 5850 so just in the
black. Whilst we saw a little recovery from the lows yesterday the
theme of the past few days has definitely had a risk aversion feel about
it so the question is whether this move to the downside has further to
go. So far it has not matched the sell off of some 3.5% at the
beginning of this month, and if it did it would bring us down to the mid
5700s, but if the momentum for the bears does build and we see a bigger
correction of 5-10% then we could be seeing downside targets of 5650 to
5350. Over the medium term the 5700 area is quite a major support area
and considering that so far this year retracements have been met rather
quickly by buying the feeling is that we might not see a double digit
percentage correction.
The
theme of the economic data this week has been US housing and we end
with new home sales today. The pace of sales is being capped by the
number of new homes available for sale being at a record low and rather
like in London, the lack of property on the market is inflating prices
somewhat.
On
the currency markets, the recent move to the downside in risk assets
has strangely led to a fall in the dollar whose recent run of form seems
to have come to an end. At the same time the euro has not exactly
suffered a great deal from the sell off in equities meaning that
currency market movements this week have been slightly out of sync with
what you’d expect to happen. This morning EUR/USD is at 1.3265 and on
the bid at the time of writing as it tests the day’s highs. Near term
support and resistance is seen at 1.3185, 1.3160, 1.3130 and 1.3280,
1.3310 respectively and for now it just seems that momentum is with the
bulls.
Gold
too has seen some pressure to the downside. You would have expected
the recent risk aversion and dollar weakness to boost the price of the
yellow brick, but no such luck for the bulls who are starting to get a
little nervous about the precious metal’s inability to return to its
highs.
