Atul has worked in financial markets for more than a decade and qualified as a technical analyst . Over recent years Atul has been involved in creating and running a wide range of educational programmes for private and institutional investors - ranging from the basics of financial markets through to more advanced trading strategies.
Perhaps the biggest factor in projecting commodity prices for the rest of the year and going into 2011 is the fate of the US dollar on the world foreign exchange market. Precious metals, grains, and tropical commodities have all flirted with record-high prices, as the dollar slipped further and further against its major trading pairs.
During November, the currency markets have found some stability, with the USD finding something resembling support at a very long-term trend line near 77.00, and its exchange value has been working sideways to higher in volatile trade.
Much of the dollar's bottoming out has come in the shadow of a sharp rise in the interest rate complex, as higher consumer prices in the US, combined with the Federal Reserve's renewed commitment to keep the country's money printing presses at full tilt, spurred heavy selling in the treasury bond market. Investors concerned with holding long-term debt in a falling currency with negative real returns have begun shopping elsewhere for higher returns, pushing interest rates higher as bonds fell.
This shift in the perspective of long-term investor psychology is likely to define the trading environment going forward, and will likely continue showing up in the technical price action in both currencies and treasuries, which in turn will have a big effect on the entire commodities sector. As yields on US treasuries become more attractive, and the establishment of a long-term low can be speculated upon by at least some portion of the institutional investment company, the prospect of buying long-term low-risk debt at attractive yields in an undervalued currency (that is, the dollar) shifts buying interest back into the market, and creates the foundation for a long-term cycle of renewed buying interest in dollar-denominated assets.
Chart pattern recognition has been widely used among expert traders since the 1930s, to uncover potential opportunities in oversold or overbought markets.
Wall Street initially traded higher after US GDP expanded at a faster pace in the fourth quarter and consumer confidence improved. However, protests in Egypt and a technical glitch on the Nasdaq 100 gave investors an excuse to book profits.
Todays Indictor US CHICAGO PMI-
A survey of Purchasing Managers across the states of Illinois, Indiana and Michigan, that aims to measure the business conditions. The survey covers such areas as new orders, inventory levels, production, supplies and employment. The answers are used to compile a 'diffusion index'. 50 is used is a benchmark figure; a figure greater than that indicates expansion, whereas contraction is reflected by a figure below 50.Weekly Commodity Update: US Dollar Basket
Perhaps the biggest factor in projecting commodity prices for the rest of the year and going into 2011 is the fate of the US dollar on the world foreign exchange market. Precious metals, grains, and tropical commodities have all flirted with record-high prices, as the dollar slipped further and further against its major trading pairs.
During November, the currency markets have found some stability, with the USD finding something resembling support at a very long-term trend line near 77.00, and its exchange value has been working sideways to higher in volatile trade.
Much of the dollar's bottoming out has come in the shadow of a sharp rise in the interest rate complex, as higher consumer prices in the US, combined with the Federal Reserve's renewed commitment to keep the country's money printing presses at full tilt, spurred heavy selling in the treasury bond market. Investors concerned with holding long-term debt in a falling currency with negative real returns have begun shopping elsewhere for higher returns, pushing interest rates higher as bonds fell.
This shift in the perspective of long-term investor psychology is likely to define the trading environment going forward, and will likely continue showing up in the technical price action in both currencies and treasuries, which in turn will have a big effect on the entire commodities sector. As yields on US treasuries become more attractive, and the establishment of a long-term low can be speculated upon by at least some portion of the institutional investment company, the prospect of buying long-term low-risk debt at attractive yields in an undervalued currency (that is, the dollar) shifts buying interest back into the market, and creates the foundation for a long-term cycle of renewed buying interest in dollar-denominated assets.
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