Gold Bulls Take Charge; Crude Oil Extends Losses
The dollar was one of the most bullish currencies during the recent trading week. It gained as there was a lot of instability in the financial markets. Moreover, traders ditched bitcoin and crude oil, prompting them to buy into the greenback on all fronts. This all comes as the Fed is likely to go ahead with the interest rates increase later this year. With many positions in stocks overstretched, buying into the greenback seems to be the best bet. The fact is the dollar gained versus all 31 of its major peers last year. The Fed will go ahead with its first increase in borrowing costs since 2006.
The euro made some very big losses during the trading week. Traders decided that it was best for them to go short as there was a slump in European stocks. The euro tumbled versus the dollar and the yen as investors felt that it was better for them to put their money into haven currencies. If there ends up being additional losses for European stocks in the days ahead, then the euro will suffer yet again.
It was unfortunate to see the pound sterling trade sideways in the past few trading days. It was the case that the British currency was able to gain ground on Friday. The thing is that traders were not in favor of taking such big risks, as the British economy seems to be slowing down. In addition, there seems to be falling house prices, which could spell trouble. Therefore, you may want to continue ditching the GBP/USD once the coming trading week gets going.
It was a shame to see that there were big losses for American stocks during the trading week that just passed. The same was true for British and European equities. Traders just had a lack of risk appetite following the big gains that we saw in previous weeks.
With there being falling U.S. wages and the forecast that rates will rise sooner rather than later, this sparked a selloff in American and global stocks. This all comes after the biggest two-week rally in three weeks.
Traders will need to trade very cautiously in the coming trading days if they expect to make maximum gains from the financial markets. One of the hot stocks is likely to be Apple, so go long on Monday.
The crude oil binary option slumped by several dollars in the previous several trading days. What really hurt crude was the selloff of volatile assets. In addition, OPEC reiterated its reluctance to cut output. Therefore, it is no wonder why traders are so bearish on crude oil futures at the moment. The commodity is currently trading at $48.17, and it will be interesting to see if it will dive below the $46.00 mark within a week’s time.
The gold binary option was able to surge during the trading week that just passed. Investors were in the mood to go long as the commodity has been offering them such high returns as of late. If there continues to be losses in global stocks in the next few trading days, then we would see gold surge. This means go long on gold as soon as possible.
Gold is one of the most underestimated assets to put your money in at the moment. Traders simply do not understand the opportunities that this yellow metal has to offer. This is why you should look to open weekly Call options once you get a chance on Monday.