Weekly Overview of CFD Movements - 28/01/2019 - 01/02/2019
January 30, 2019
January 30, 2019
Risk Disclaimer: The example below is for illustrative purposes only and is based on price movements derived from Contracts for Difference (CFDs). The calculations reflect hypothetical outcomes using historical or specified price data for the relevant instrument on the stated date and are not indicative of future performance. Any reliance placed on this material is strictly at the user’s own risk.
The Euro strengthened against a weaker dollar. The European Central Bank confirmed softer economic data which prevailed in the euro zone. But the common European currency was supported by good inflation expectations remaining within the range of the ECB’s interest rate guidance.
The British pound has rallied some 6 percent from the beginning of the year, but further gains may be limited unless the UK Parliament emerges with a convincing majority on the vote for an alternative plan B for Brexit.
The Japanese yen slightly strengthened against a weaker dollar, despite weaker export expectations for the country, due mainly to the trade war between the US and China.
Overall, the U.S. dollar index fell to just above 95 levels – a two week low, affected by fears of a possible slowdown in interest rate hikes. Market participants will focus on the Federal Reserve's policy meeting on Wednesday and future guidance. Chairman Jerome Powell is expected to acknowledge growing risks to the U.S. economy.
The Turkish Lira was little changed against the dollar as Trade Minister Albayrak attended Davos and expressed confidence that the economy won’t fall into recession this year, as some economists fear.
U.S. indexes were mainly flat last week. Major tech giants such as Apple, Microsoft Facebook and other business behemoths such as Tesla, Boeing, Visa and Amazon will all report their quarterly results this week. U.S. charges against Chinese telecom company Huawei raised uncertainty over the possibility of any progress during trade talks between US and China, which are taking place this week.
Oil prices fell last week. The US Oil rig count, which added 10 new rigs has provided some support since Friday. The political crisis in Venezuela also provided support for Crude, although Saudi Energy Minister al-Falih stated that political turmoil in Venezuela would not have much impact on global oil markets, which remain well supplied.
Gold traded higher, breaking above the 1300 level for the first time since October last year. Gold has been supported by trade tensions, dovish statements from the Fed and the recent weakness in the dollar.