Happy New Year
As a trader taking a backwards look at 2012, I can only conclude that it has been a strange kind of year. In the UK, the stock market is already closed for 2012. Anyone who has read some of my previous posts will guess how I am going to summarise 2012 though. A year when much changed and little was achieved. After three years of crisis, Greece and the problems of the Euro are firmly on the back burner as the world watches the USA head ever closer to the so called fiscal cliff. Does that mean the problems of the Eurozone are over? Have they been miraculously fixed? The only judgement call I...
Read MoreKicking the can
When it comes to kicking the can down the road, European ministers have shown the world their expertise. Aligned with their ability to fudge issues, it gives markets and commentators plenty of material to write about. This weeks further instalment of the Greek bailout is a case in point. After months of negotiation and discussion, including an open spat with the IMF, European institutions handed over several billion more Euros to Greece as part of their international bailout. IMF participation at this time was deferred. Greece now has the liquidity to meet it’s immediate financial...
Read MoreEuro and the ESM – a long way to go
Yesterday’s announcement of unlimited support for the Euro from the ECB was widely expected. Indeed, the leaks have been coming as often as the rain showers. The pre-conditions for the buying of government bonds was also widely trailed. So yesterday’s announcement by Mario Draghi was just the confirmation of what we already knew. The ECB would buy unlimited short dated bonds from governments in financial trouble, as long as those governments confessed and accepted the road of supervision from institutions such as the IMF. This announcement was aimed at preventing Spain and Italy...
Read MoreAugust trading review
It’s been a quiet month, with trading volumes very low. Volumes of UK equities traded daily are about half the levels from earlier in the year. Yet the FTSE index has managed to reach it’s highest levels since early April. The current trend is showing upwards, with the moving averages all in the right direction and the 50EMA providing support yesterday. After a fantastic Olympics and now the amazing paralympics, eyes are not focused on trading just yet. When you look at the narrow trading range of EURUSD this week, and for much of August, you could be forgiven for thinking the...
Read MoreECB impact on GBPUSD
ECB Impact on GBPUSD On 20 June, I wrote about central bank power and the impact the ECB can have on the currency value. This was in evidence again this week on Thursday, when Mario Draghi, the head of the ECB, stated they would do “whatever it takes” to save the Euro. I have chosen to illustrate the impact of his speech on GBPUSD, rather than the Euro. The 4 hour candle on EURUSD was 199 pips in range. The candle length for Cable was 232 pips. In either case, very significant movements. One of the “excuses” for weak GDP figures in the UK has been the turmoil in...
Read MoreUK GDP and the Olympics
UK GDP figures show a third consecutive quarter with the economy shrinking, or as the official term goes, negative growth. The quarter on quarter drop of 0.7% was far greater than the 0.2% anticipated by the markets. Naturally, the value of sterling fell after the announcement. I don’t know about you, but I have some sympathy for those claiming the weather slowed the economy down. With the wettest April and June for more than a century, it was hardly surprising that construction output fell. I can just imagine all of the muddy waterlogged building sites at a virtual standstill. I have...
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