Dollar Gains on Budget Deal
We are seeing a lot of strength for the dollar this morning. Traders are in favor of buying into the U.S. currency, as it seems to be offering traders some very high returns. The GBP/USD pair is lower this morning by 0.06 percent at the $1.6437 level. The USD/CAD pair has climbed 0.03 percent to C$1.0605. The recent U.S. budget deal has made tapering more likely; lending the greenback a helping hand.
One of the most bullish currencies this morning is the euro. This is a pattern which we have seen since the beginning of yesterday’s trading session. Traders feel like taking some risks with regards to the EUR, despite there being instability in the forex market this morning. The EUR/GBP currency cross is higher as of now by 0.04 percent at the 83.72 pence level. However, the euro has not been able to make inroads into the U.S. dollar, but this may change later on.
Technical indicators show us that the yen is very much undervalued, which is why we are seeing bullishness for the Japanese currency this morning. Traders are in favor of going long on the Japanese currency as there is weakness with Asian stocks. This has increased the demand for haven currencies this Wednesday morning. The USD/JPY pair is lower today by 0.12 percent at 102.73 yen.
There was a slump in U.S. stocks during yesterday’s trading session, which reversed the two-day rally we saw on Friday and Monday. This shows just how quickly the situation on Wall Street can change. This is a sign that you will need to be cautious in the next few trading days while trading U.S. equities.
Better-than-expected economic data and the forecast of an end to U.S. stimulus led traders to go short on American stocks yesterday.
The Dow Jones Industrial Average dived 0.3 percent to 15,973.12. The S&P 500 slipped 0.32 percent to 1,802.62.
Facebook gained 2.87 percent to $50.24. Cisco Systems slipped 0.05 percent to $21.21.
The crude oil binary option is about level this morning at the $98.51 level. In fact, the commodity is trading near its highest level in six weeks, as U.S. supplies of the commodity dipped. This means crude oil inventories in America slowed for a second straight trading week. Also, the U.S. and other leading economies continue posting positive economic data, which has only naturally led to higher demand for the black gold. It is important to take into account that the commodity surged yesterday by a whopping 1.2 percent. Therefore, there may not be much movement today.
The gold binary option was one of the biggest gainers yesterday when it came to commodities. Traders felt like taking some big risks with the yellow metal due to the much weaker dollar. Also, it is vital to know that the commodity is still undervalued to a certain extent. The result was traders taking some very big risks with gold during yesterday’s trading session. On the downside, the commodity is lower this morning by $3.30 at $1,257.80.
It was unfortunate to see the Dow Jones make some very big losses yesterday. The reality is that traders are not willing to take big risks when it comes to American equities. They seem to be worried about the end to economic stimulus. The losses for leading U.S. stocks and indices may have been overdone. This means that we could see a bullish comeback for the Dow Jones today. As a result, start opening Call options during the U.S. session.