« Bitty Bites of Risk! | Home | All Eyes on US Consumer Confidence, 10AM EST »
About Face!
By Mike Conlon | October 26, 2009
Well the morning started off benignly enough with some minor moves in the commodity currencies, but an “about face” has occurred. This morning I commented on Aussie and Kiwi strength and Dollar and Yen weakness. Well it looks like the exact opposite is true now.
It looks like the equities market has reversed course, with the Dow 30 going from up +100 or so points this AM to down -100 or so points. So as equity markets went from gains to losses, the currency trades went from risk appetite to risk aversion. Also to note is that oil is now trading down to under $80, and gold is off a little as well.
The Canadian dollar is also getting hit a bit harder than earlier, as it can be influenced by gold and oil prices. CAD is down roughly 1.00% today so far vs. USD and JPY.
I’ve actually had a small short traded triggered in AUD/USD as I was thinking that with gold down this AM that either gold would go positive or AUD/USD might fall. I set up at limit sell that got triggered with a tight stop, for a short-term day trade.
Because of the inter-relationships between currencies, commodities, stocks, and interest rates, it is sometime easier to “telegraph” a move in one when you have a decent idea where the other is going (or might go).
To learn more about these inter-relationships, known as correlations, get educated here.
To follow along with a real-time practice account, click here.
Tags: account, AUD, Aussie, cad, commodities, course, currenc, currencies, dollar, dow, fx, fxedu, Il, interest, interest rate, interest rates, jpy, market, Mike Conlon, practice, ssi, stock, stocks, time, trade, trades, trading, USD, Yen
Topics: What To Look At In The Market | No Comments »