Has the S&P 500’s Forecast Recharged Risk Appetite Across the Financial System?
There were a few fundamental highlights this past week such as the news that the US and China may have reached an agreement ‘in principle’ for its Phase One deal. Yet, that silver lining was the exception to the fundamental rule of dimming growth and faltering monetary policy. Nonetheless, the S&P 500 led risk appetite higher with its own record drive. Is this an infectious enthusiasm that will rouse November seasonal optimism?
The Australian Dollar rose to three-month highs as October bowed out, boosted by hopes for more monetary stimulus. Trade worries dragged it back but may yet be overcome.
The next 25 basis point US rate cut is not fully priced in until mid-2020. And that won’t please President Trump who wants further rate cuts now.
Fresh updates from the Bank of England (BoE) may fuel the recovery in GBP/USD if the central bank alters the forward guidance for monetary policy.
The Dow is trying to break out of a pattern, the DAX holding is strong as it heads towards a key level from last year, while the FTSE is stuck under trend resistance for now.
Euro strength came back this week against both the US Dollar and Japanese Yen; but can EUR/USD bulls take-out a big zone of resistance sitting overhead?
The Australian Dollar still looks to be biased lower as prices test the outer bounds of a downtrend guiding the currency lower for nearly a year.
The month of October was essentially a wash for US crude oil, but Friday’s charge this past week shows that volatility is a persistent feature of the trading scape. What are the key levels to watch as the charge plays out?
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