The EU Morning Report - Oil Had its Biggest Slump this Year Since 2008 - 31 December 2014


Currencies

  • The euro (EUR) remained range bound at 1.2152 yesterday against the US dollar (USD) as Greece is heading for early elections, while putting in danger the country’s bailout agreement if the anti-austerity party wins.
  • The US dollar (USD) crashed to 118.85 against the Japanese yen (JPY) yesterday as Bank of Japan (BOJ) said that they will increase the length of maturity of the government bonds that it buys. Today the US Unemployment claims, the US Chicago PMI and the US monthly Pending Home Sales will be announced with expectations at 287K, 60.2 and rise by 0.6% respectively.

Equities

  • European equities fell as yen and gold gained. The Germany 30 (DAX) dropped to 9791, the France 40 (CAC) went to 4235 and the EU Stocks 50 (ESX) to 3130.

Commodities

  • WTI Crude (OIL) remained near its 5-year-low at 53.70 USD per barrels as OPEC producers are fighting US shale for market share.

Mover & Shaker with forex options

  • Gold (XAU) skyrocketed yesterday to 1210 before retraced back to 1200 as dollar and global equities retreated.
  • Option traders may consider buying a Call on the XAUUSD and gain if the pair moves higher, while the risk is limited to the premium paid.

Written by Demetris Constantinou
Currency Strategist at easy-forex®