Crude Oil Surges Last Week
There was a lot of mixed behavior when it came to the greenback during the previous week of trading. On one hand, the EUR/USD was bought into on all fronts. On the other hand, the dollar was able to make some impressive inroads into the greenback. The rally is that there are so many interesting dynamics driving the forex market at the moment. The dollar is set to continue surging versus the yen in the next trading week. You may want to go long on the EUR/USD pair on Monday.
The European single currency capped its longest rally since June as the ECB refrained from boosting economic stimulus in the region. This allowed the euro to climb for a fourth straight trading week versus the greenback. The European Central Bank reiterated that it will keep interest rates unchanged due to the high economic growth rate of the U.S., decreasing regional risks.
The CAD slipped for the third straight trading week versus the USD, as Canada’s economy is not growing as fast as traders had hoped. It is expected that interest rates in Canada will stay lower for a prolonged period. This is in contrast to what is expected to happen in the U.S. Traders will need to be cautious while trading the CAD once Monday’s trading commences.
Stocks declined for four days out of five during the previous trading week. Investors were simply not in the mood to take risks when it came to American stocks. This is despite them going bullish during Friday’s session. The biggest issue on traders’ minds at the moment is the idea of Fed tapering.
European stocks capped their biggest weekly decline since the month of June. This was due to a better-than-forecast U.S. jobs report. The problem is this increased the speculation that the U.S. will cut stimulus.
The crude oil binary option capped its biggest weekly advance since July on the improving U.S. economy. For example, the U.S. jobless rate fell to its lowest level in five years. This has increased the outlook for economic growth in the world’s largest fuel-consuming country. The black gold rose last week by a whopping 5.3 percent, as traders are now in the mood to take some big risks when it comes to the commodity. The gains were compounded due to U.S. consumer confidence climbing the most in five months. Moreover, crude supplies in the U.S. fell for the first time in 11 weeks. Traders foresee further gains in the coming week for crude.
The gold binary option dipped for much of the previous trading week, as there seems to be a number of other assets to put their money in. Also, with the U.S. set to cut its economic stimulus, this has led to a lack of demand for haven metals such as gold. In addition, there does not seem to be enough factors backing gold futures at the moment, so look to sell gold in the days ahead.
There seems to be a lot going for crude oil these days. There has been a reversal in crude for the better as of late. It was previously expected that the increase in supply from Iran would push prices lower, but the exact opposite has happened. Not a person expected that U.S. supplies of crude would decline, but the result has been higher prices for the commodity. This may allow crude prices to continue going higher than the current level in the next few days.