FX Weekly: 12th December 2011

• FX space largely unchanged last week as all currency pairs posted ±1% change against other G20 counterparts

• Gold prices were a shade lower, meeting strong support around $1670 per troy ounce

• Short-term, traders remain sceptical as to whether we have seen enough to reverse the crisis of confidence in the Euro-zone. Chances of an IMF program for either/both Italy and Spain has increased with news of an additional €200bn IMF fund

• Domestic demand is slowing in China as well as globally – prime data out this week could be the most market moving FX theme in the absence of revelations in Europe

FX Weekly: 5th December 2011

• Oil and Gold remain the most volatile contracts as risk tolerance reversed course. Commodity currencies and Scandies were the pack leaders last week in G20 FX – most strength seen against USD and JPY

• ECB expected to cut interest rates again (Thu) and provide additional liquidity. Political progress also a key focus – full fiscal union would be hugely EUR/USD positive

• Periodic Chinese activity data could be crucial if global economic slowdown is worse than feared

• On the political front, near-term focus is on Italy’s reform agenda to be unveiled today and on the new Spanish government’s program once it takes office on December 22nd

• Multiple central bank meetings coming up: RBA and BoC on Tuesday, followed by RBNZ, BoE and ECB on Thursday. The RBA could be market moving because a cut is fully priced but the bank may not ease so soon after its previous move

Psychology of FX Trading

Webinar held for Alpari (UK) clients in November 2011 discussing the importance of Psychology in Trading.

Economic Games in Political Circles

With the largest financial crisis in living memory behind us, a larger, more pervasive crisis is setting in as governments continue to privatise public gains and nationalise private losses.

Is the US dollar losing its status as the defensive asset of choice?

Resistance is Futile

As nations compete for export-led growth, central banks are facing increasing criticism for manipulating their domestic currencies.

FX: The Ultimate Trading Indicator

As financial markets stutter forward amidst growing private and national debt, traditional currencies are in danger of suffering a confidence crisis, but equally, given their dynamics, can be a leading indicator for all asset classes.