Friday’s U.S. Stock Dip Weighs Over the Markets

Friday’s U.S. Stock Dip Weighs Over the Markets

Currencies

USD

The good news for the dollar is that it has recorded its longest rally since 1967. There have been a number of factors boosting the greenback. One of these is the forecast that the Fed will go ahead with a rate increase in the first half of 2015. The EUR/USD forex binary option fell 0.71 percent to the $1.2831 level. The AUD/USD forex binary option is trading lower by 0.66 percent at the 89.30 U.S. cents level. The dollar also made inroads into bitcoin on Friday. With other nations expected to go ahead with additional stimulus measures, this will only boost the dollar further this Monday. Therefore, you will want to go long on the USD while it still goes higher.

GBP

For those of you who have followed the pound sterling will have noticed that there is less panic about its future. In addition, the EUR/GBP cross dipped to the lowest rate in two years. This came as Scotland voted to continue staying part of the U.K. Moreover, the pound was able to touch its highest level in two years versus the U.S. dollar. It is likely that there will be more confidence in the GBP in the days ahead. Call options for the GBP/USD pair will payoff for traders.

JPY

The yen slumped on Friday and for the sixth straight trading week. The USD/JPY pair is higher as of now by 0.34 percent at 109.07 yen. The yen also lost a lot of value versus a number of its other peers. The USD/JPY forex pair recently touched 109.45 yen, the highest level since August 29, 2008. Traders should make sure that they follow all of the developments from Japan is they are interested in trading the GBP/JPY, EUR/JPY and USD/JPY as Monday’s trading gets going. We may very well see losses for the Japanese yen yet again.

Stocks/Indices

There were overall gains for U.S. stocks last week. The thing is that they got hit on Friday, as traders realize that a number of equities were overvalued.

Traders should not be so worried about the weakness which we saw during Friday’s trading session. The fact is that U.S. stocks are somewhat overheating, so many traders decided to wait on the sidelines on Friday.

If there is further talk of higher interest rates, then this will curb stocks prices. Investors seem to buy into stocks when borrowing costs a lower, but as borrowing costs increase this will have a positive impact in the American economy. Traders will soon understand this, and start going long yet again.

The S&P 500 Index fell on Friday by 0.05 percent to 2,010.40. Oracle Corp. slumped 4.21 percent to $39.80.

Commodities

Crude Oil

Crude oil futures tumbled on Friday by 0.3 percent to the $91.70 level. It was the case that crude oil future slumped for the third straight trading day on Friday. What did push crude prices a lot lower was a much stronger dollar. What also pushed prices lower at the end of last week was the increase in crude supplies.

Gold

Gold futures dipped on Friday by $10.70 to $1,216.20 during Friday’s trading session. A big factor which really hurt gold prices on Friday was the much stronger dollar. There was simply a lack of demand for the top commodities. Much of the same may be on the cards as the trading week gets going.

Wild Card

GBP/USD

With Scotland deciding to stay as part of the U.K., traders may want to buy into the GBP/USD as today’s trading gets going.