Today’s Key Market Drivers – 19th May 2017

Thursday saw another initial widespread sell-off on financial markets that was eventually met with some optimism with buyers appearing late in the afternoon trading session on Wall Street.

The Dow Jones closed up 56 points and the Yen lost ground as the “falling knife grabbers” took their chances at trying to pick the lows. Experience tells me that the recent lows will likely be tested again in both stock and currency markets. Today being a Friday may see trading volumes light with Trump’s Twitter feed or a new White House news scandal potentially gapping the market up or down on Monday.

The economic data is also reasonably light Friday with Canadian CPI and a speech by Mario Draghi in Tel Aviv the only high impacting news likely to get any attention. Speculation continues as to whether or not Trump’s campaign team colluded with the Russians in the election campaign and if Donald Trump asked former FBI Chief Comey to let go of an investigation into the former National Security Advisor. This ongoing Trump soap opera is likely going to linger and is why I think the lows that were recently created may be tested again. What helped halt the slide in the US Dollar on Thursday was stronger than expected US economic data. The number of US citizens applying for unemployment benefits fell to a 28-year low.

Will the market eventually get used to the Presidents ongoing soap opera of drama and scandals? Trump appears to be the Teflon man so far with his accusations of Obama bugging Trump Tower through the election campaign quickly fizzling out. Trump also seems to have a habit of treating the Presidency like being a CEO, sacking anyone who he doesn’t like. So far he appears to have gotten away with whatever he desires and I am eager to see in coming days what smokes, lights and mirrors he throws up to try and deflect attention away from this week’s dramas.

Whilst we’ve been watching the Yen rally in recent days spare a thought for those traders who have been holding large Brazilian Real long position. The Real fell 7% on Thursday after President Temer was recorded discussing payments to silence a witness in a corruption investigation.

 

 

About the Author: Andrew Barnett

Andrew is a professional trader and successful investor who has a strong focus on education. He is a regular Sky News Money Channel Guest and one of Australia’s most awarded and respected financial experts, and is regularly contacted by the Australian Media for the latest on what is happening with the Australian Dollar. Director at LTG GoldRock, Andrew Barnett, guides thousands of traders around the world in the live market on a daily basis, advising them on buy and sell directions, as well as trading his own personal account. Andrew, a regular key-note speaker at trading and wealth-creation events throughout the Asia Pacific region, is an authorized representative registered with the Australian Securities and Investment Commission (ASIC).

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