All posts by Fawad Razaqzada

AUD/NZD: On The Verge Of Breakdown?

Fawad Razaqzada

The AUD/NZD is probably not under many traders’ radars at the moment given for example the sharp moves in stocks and the US dollar recently, but this cross could be one for those who would like to take the greenback totally out of the equation. The AUD/NZD surged higher in early April from a low of just above parity to a high so far this year of about 1.1425/30. The rally thus took out the 2014 high of 1.1300. But as can be seen on the chart, the bulls were unable to hold their ground there for too long and prices have generally held below this handle for this best part of the past two months, without causing too much pain for the bulls. more…

WTI oil drops to 6.5-year low… but where to now?

Fawad Razaqzada

After falling for nine consecutive weeks, the price of WTI crude hit oil its lowest level since March 2009 on Thursday. Though US oil has bounced off the low ($41.35), it remains near this year’s earlier base of about $42 and thus on course to potentially fall to $40 a barrel next. That being said though, the correction potential is now high as ‘bargain hunters’ try to buy “cheap” oil and the sellers take profit ahead of the weekend. If seen, this would probably only lead to a temporary bounce. After all, the end of the summer driving season is approaching and refineries will have to more…

Forget Super Thursday: it could be Black Friday for gold

Fawad Razaqzada

Now that Super Thursday is behind us, it could be a Black Friday for gold. Today’s much-anticipated jobs data could provide us a big clue in terms of when to expect a potential rate rise from the Federal Reserve. If the numbers are as strong as the ISM services PMI indicated on Wednesday then calls will increase for a September rate hike. This should help to give the dollar another shot in the arm, which in turn could weigh heavily on gold. Conversely, if the numbers are weaker than expected then the dollar could fall back, leading to a relief rally for gold. Admittedly, the dollar is just one among several factors that determine the direction of gold. But today, it will most likely be the main driver. more…

EURUSD: all bears need now is a ‘lower low’

Fawad Razaqzada

The EURUSD has been trending lower in recent weeks and the selling pressure has accelerated over the past few days as the investor focus has returned to the interest rate differential between the US and Eurozone economies. Whereas the Fed has signalled that it is ready to hike rates later this year, the ECB has only recently started QE and there were no suggestions from President Mario Draghi today that the bank is ready to trim or end the €60 billion a month stimulus programme early. In fact, Draghi said the ECB has temporarily increased emergency funding to Greek banks by €900m. Thus, the ultra-accommodative monetary policy is here to stay for now and this should in theory put downward pressure on European bond yields, which in turn could depress the euro even further. more…

USD/JPY: where to next?

Fawad Razaqzada

The appetite for risk has improved noticeably this week, as evidenced by a sharp rebound across the global equity markets. FX traders have likewise witnessed the unwinding of some safe haven trades with CHF and JPY both falling sharply following their recent gains. The US dollar has performed well given the fact that the weekly unemployment claims disappointed expectations and after the minutes from the FOMC’s last policy meeting contained very little in the way of new information other than what we already knew. However, as some FOMC members are concerned about the developments in China and Greece, more…

Gold: moment of truth

Fawad Razaqzada

We have repeatedly commented that gold’s near term outlook does not look bright because of the apparent lack of interest from investors worried about the crisis in Greece. Whereas the European stock markets have fallen quite dramatically in response to the deteriorating Greek situation, the precious metal has barely shown much reaction. Admittedly, this has been in part because of the strength of the US dollars, which has been climbing steadily higher this week in anticipation of Thursday’s US jobs report. As it turned out, more…

Silver unable to shine despite raised Grexit fears

Fawad Razaqzada

Though precious metals have bounced off their session lows, they are generally continuing to struggle for form despite the increased uncertainty about Greece. Gold is now down for the fifth consecutive day and although silver has managed to buck the trend from time to time, it too is a touch lower today and also on the week. Investors are hoping that an eleventh-hour deal for Greece will be struck today, which is part of the reason why European stocks are clinging on to their gains. more…

GBP/USD Testing Key Resistance Ahead Of US Data

Farad Razaqzada

The GBP/USD is up for a third consecutive session, extending its gains from the base of 1.5170 formed on June 1. The upsurge has been primarily driven by a weaker US dollar rather than a stronger pound, with the dollar index now down for a third straight day. But the pound has also gained some ground on the back of some mixed bag UK economic data of late. Today’s numbers showed manufacturing production unexpectedly fell 0.4% in April, wiping out the March increase, while industrial production was up 0.4% over the month when an increase of only 0.1% was expected. more…