Pound Jumps on Improved U.K. Growth
The pound climbed to its highest level in more than two years following as string of data showing the health of the U.K. economy. The growth forecast has been upgraded, which has lent the British currency a helping hand in the past week or so. Data such as the improvement in GDP and the surge in mortgage approvals shows that the U.K. economy is one of the healthiest in the OECD. The pound has also managed to make inroads into the euro, pushing the EUR/GBP cross to a three week low.
The AUD/USD pair fell to its lowest level in more than two years last week. This allowed it to cap its sixth straight weekly drop. This is following concerns that investment flows into the country will slowdown. The Australian dollar is down versus the majority of its other main peers too. Traders fear the AUD/USD may slide in the days ahead.
The Canadian dollar slipped for a second straight week versus the U.S. dollar. This is on signals that the U.S. economy will grow faster than the Canadian economy in the short and medium term. Also, the reason for the USD/CAD pair’s strength is on the forecast that the U.S. Federal Reserve will reduce economic stimulus prior to the Bank of Canada.
U.S. stocks mark post-Thanksgiving trading with bearishness. It was fortunate to see that there was a lot of weakness when it came to U.S. equities and indices during last week’s trading session. Investors just felt that it was not worth it for them to take big risks when it came to equities on Wall Street.
On Friday, the S&P 500 dipped 0.08 percent to 1,805.81. The Dow Jones Industrial Average fell 0.07 percent to 16,086.41.
Cisco Systems dived 0.09 percent to $21.25. Microsoft climbed 1.41 percent to $38.13.
We saw a lot of weakness with the crude oil binary option last week. Traders decided to sell their holdings of the back gold, as it was simply not offering them high returns. It needs to be taken into account that the factors which were on traders’ minds of why they ditched the commodity. One of these was the nuclear deal. Now Iran is increasing trade, and exporting additional crude. Therefore, it is only natural that the price of the commodity has decreased. Also, traders are of the view that there will be additional losses in the weeks and months ahead. As a result, look to ditch crude oil futures this coming week.
We saw a lot of weakness for the gold binary option for the former part of the previous trading week. However, traders became more confident as the trading week passes by. This allowed gold futures to surge on Friday alone by $12.90 to the $1,250.80 level. This was largely due to the increase in demand of jewelry, coins and bars from China, the second largest buyer of the commodity. More bullishness is likely in the days ahead.
We all know that the Dow Jones is one of the most in demand indexes at the moment. Traders are in the mood to take some big risks when it comes to the Dow Jones. This is even though it took a small beating on Friday. It should be noted that it was not a heavy beating. Therefore, there may be a chance that the leading U.S. indices may experience much bullishness in the coming trading weeks. Once the markets open on Monday, initiate weekly Call options in the Dow Jones.