Market Overview

13 July 2022 06:43

Mark Goichmann

The Euro has reached parity with the U.S. Dollar for the first time in 20 years, but it seems that the Euro could be on its way down as there are internal reasons why the single European currency could decline while the Greenback could rise further. The Dollar has been rising aggressively over the last couple of months. The U.S. Dollar index (DXY) climbed from 95 points at the beginning of 2022 to 108 points, or 14%, recently. The Dollar is strengthening as the Federal Reserve (Fed) continues to tighten monetary policy by drastically raising interest rates to combat record inflation.
8 July 2022 10:05

Mark Goichmann

The Euro has lost 10% against the U.S. Dollar since the beginning of 2022 and is now close to being on an equal path to the Greenback. This week the single European currency fell dramatically to the 1.01 level, a level, which was lastly seen20 years ago. Traditionally a weaker Euro is considered to be an advantage for the export oriented European economy, and in this kind of a situation the European Central Bank (ECB) normally advocates for the single currency to decline. However, recent realities make this issue more complicated.
28 June 2022 13:34

Mark Goichmann

The gas market in Europe was on alarm recently as prices for July 2022 Dutch TTF gas futures jumped to 133 Euros per MW last Friday. Prices scaled back to 129 Euros on Tuesday, but they are unlikely to reach a deeper correction. Prices surged as Russia significantly reduced gas supplies to Europe during the period when gas was being replenished into gas storages in preparation for the coming winter season. Storages are reported to be filled by 59% of their total capacity, which is a low percentage for this time of the year.
21 June 2022 12:32

Mark Goichmann

Europe is beginning to suffer from the physical shortage of gas. There are many reasons for this that supplement each other. The Freeport LNG Quintana Island liquefaction facility is currently shut down after a gas blast and will not continue its full operation until late 2022. This facility exports around 20% of LNG from the United States that primarily goes to Europe. Gas exports via the North Stream pipeline to Germany have been dramatically cut by 100 million cubic meters per day or 60% of the regular supply.
14 June 2022 11:17

Mark Goichmann

Lead is a toxic metal for humans by its nature. And it seems that now it is also toxic for investments as its price dropped by 3% on the London Metal Exchange this Monday, from $2150 to $2087 per tonne. It is a production metal that is sensitive to economic growth perspectives and, as such, its price significantly dropped  at the beginning of the week after the United States was hit by a huge inflationary shock. Consumer prices rose unexpectedly by 8.6% year-on-year in May after posting 8.3% in April.
9 June 2022 12:32

Mark Goichmann

Since the beginning of May the U.S. Dollar vs the Turkish Lira chart could be compared to a space rocket, shooting off into the sky.  This week the Greenback is up from 16.26 to 17.20 Turkish Lira, or by 3% over three days. This amounts to 600% of annual yield. It seems that after a slow start, the “rocket” went shot far out into outer space. The Turkish Lira is primary suffering from the Turkish Central Bank’s unusual monetary policy directed by the President of Turkey Recep Erdogan.
31 May 2022 16:07

Mark Goichmann

Dutch TTF July 22 gas futures soared above 93 Euros per 1 MWh, an important psychological resistance level, and hit 95 Euros on Tuesday morning. This may indicate that prices may surge further. Prices surged after European leaders agreed in principle to cut about 90% of oil imports from Russia by the end of 2022 raising Brent crude prices above $120 per barrel. Gas is an alternate fuel and its prices followed oil quotes.
24 May 2022 11:34

Mark Goichmann

Gold has two major abilities. One is that it is traditionally considered to be a safe haven asset that is in high demand during times of elevated risks in the market, rising inflation, and geopolitical uncertainties. The second is that it acts as an anti-dollar indication because gold prices mostly move in the opposite direction to the Dollar. The Dollar itself has become a safe haven asset in recent months as the Federal Reserve (Fed) has risen interest rates along with Treasuries yields. So, gold prices are now more correlated with the Greenback’s moves. The U.S.
18 May 2022 09:39

Mark Goichmann

Modern irrational market life sometimes breaks traditional molds. Countries with positive trade balance were seeking for a weaker national currency to benefit their exports. Weak Euro, Swiss Franc, British Pound and similar currencies are dependent on their exports. Thus, weaker nation currency support exports and increase budget revenues. Thus, a giveaway game continued for decades. Whoever has a weaker currency seems to be the champion. Eventually, pandemic and Russian warfare in Ukraine became a game changing environment in 2022.
12 May 2022 12:48

Mark Goichmann

The British Pound suffered over the last month when it plunged 7% from 1.3112 below the 1.2200 level. However, the Greenback is responsible for most of this dive. It has been heavily rising across the market since the Federal Reserve (Fed) began to tighten its monetary policy and increasing interest rates. Geopolitical,  inflationary, and stagflation risks usually draw investors towards the safe haven U.S. Dollar. The U.S. Dollar index (DXY) that measures the currency basket of the Dollar against six major currencies, rose from 99.8 points to 104.
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CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 77.94% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
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