Loonie and Aussie Share Downward Bond

In yesterday’s post (Tide is Turning for the Aussie), I explained how a prevailing sense of uncertainty in the markets has manifested itself in the form of a declining Australian Dollar. With today’s post, I’d like to carry that argument forward to the Canadian Dollar. As it turns out, the forex markets are currently treating […]

Posted on: 30 June 2011 | 10:15 am

Tide is Turning for the Aussie due to lower commodity prices, low interest rates, and stabilizing US dollar.

“Australia is about to enter a boom that should last decades…The Australian dollar is unlikely to go back to where it was, and manufacturing will shrink in importance to the economy, perhaps even faster than it has been.” This, according to Martin Parkinson, Treasury Minister of Australia. While 30 years from now, Mr. Parkinson’s prognosis […]

Posted on: 29 June 2011 | 11:40 am

Emerging Market Currencies Brace for Correction Due to Market Uncertainty and Summer Slowdown

“It was the spring of hope, it was the winter of despair,” begins Charles Dickens’ The Tale of Two Cities. In 2011, the winter of despair was followed by the spring of uncertainty. Due to the earthquake/tsunami in Japan, the continued tribulations of Greece, rising commodity prices, and growing concern over the global economic recovery, […]

Posted on: 28 June 2011 | 3:42 am

NO QE3: What are the Implications for the Dollar?

The verdict is nearly in; there will be no QE3. The second round of quantitative easing (“QE2”) will expire at the end of this month, and while it will not be unwound for quite some time, the Fed has indicated that it will not be followed by yet another round. The question on the minds […]

Posted on: 25 June 2011 | 8:28 am

Swiss Franc is the Only Safe Haven Currency. The Franc is Starting to Distance Itself from the Dollar and Yen.

According to conventional market wisdom, there are three safe haven currencies: the Swiss Franc, Japanese Yen, and US Dollar. It is to these currencies that investors flock whenever there is a crisis, or merely an outbreak of uncertainty, and for much of the period following the collapse of Lehman Brothers, the three were closely correlated. […]

Posted on: 23 June 2011 | 11:11 am

Is it Possible to Trade Forex Part-time?

This week, I came across an article in the San Francisco Gate (which, incidentally, has really ramped up its forex coverage over the last year) that addressed this very topic. Given that part-time forex traders probably outnumber those that practice the craft full-time, such an article was long overdue. In sum, the author advises part-time […]

Posted on: 22 June 2011 | 11:17 am

Japanese Yen In "No Man's Land." When will the BOJ Intervene to stop its rise?

This, according to a hedge fund manager that has decided to cancel all of his fund’s bearish bets on the Japanese Yen. The reason: the yen is rising, and it’s unclear when – or even if – the government will intervene to push it back down. Even though the yen’s strength is fundamentally illogical, it […]

Posted on: 20 June 2011 | 9:52 am

Forex Volatility Continues Rising. What are the Implications for the Euro?

This week witnessed another flareup in the eurozone sovereign debt crisis. As a result, volatility in the EUR/USD pair surged, by some measures to a record high. Even though the Euro rallied yesterday and today, this suggests that investors remain nervous, and that going forward, the euro could embark on a steep decline. There are […]

Posted on: 17 June 2011 | 10:38 am

Euro Nears Breaking Point

It’s deja vu all over again in the forex markets as another twist in the sovereign debt crisis has sent the euro tumbling by the greatest margin in nearly a year. It was only last month that I posted “The Euro (Still) has a Greek Problem,” and yet, forex markets are once again reacting to […]

Posted on: 16 June 2011 | 9:33 am

S&P 500 Decouples from Euro?

While I have written quite about forex correlations in recent posts, the focus has primarily been on correlations that exist between currencies. In this post, I would like to address a correlation that exists between currencies and other forex markets- specifically the relationship between the Euro and US stocks. If you look at the chart […]

Posted on: 14 June 2011 | 10:58 am