Today’s Key Market Drivers: 21st August 2018
“It’s a risk on trading mood early this week.”
A “risk on” trading mood on Monday saw traders sell down the traditional safe-haven US Dollar as Turkey’s economic challenges and fears of contagion throughout European banks subsided. Traders had bought the safe haven greenback last week after Turkey’s inflation hit 16% and the currency fell by 20% following Trump imposing tough new trade tariffs. The crisis was triggered after Turkey’s continued imprisonment of a US pastor who was arrested and charged with encouraging a coup against the President.
The Euro rallied not because traders want to hold the Euro, it had more to do with the fact the fear factor that was in the market last week eased and traders sold out of long US Dollar positions which forced up the Euro. The Aussie and Kiwi Dollars as I expected continued to climb on Monday following strong moves off recent lows that were backed with solid technical support. Speaking of lows, RBA Governor Lowe is speaking in Canberra at 8.00am AEST Tuesday and economists and traders will be eager to hear any forward guidance on monetary policy from Australia’s Chief Central Banker. The RBA’s August monthly minutes will be released at 11.30am so Lowe’s speech and monthly minutes have the potential to see some volatility on the local currency as the Asian trading session gets underway.
As I pointed out in my Sunday PreMarket Prep Video there is a distinct lack of high impacting economic news early this week so the positive trend that was set last Friday was and will likely continue. The US Fed’s monthly minutes aren’t due until Wednesday and China v US trade talks won’t likely begin until the end of the week, therefore, the current positive mood on financial markets will likely stay for now.
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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 keynote 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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