Less Oil, More Unemployment

China, once again, sets the tone in the global economy. Yesterday they announced that they're going to raise oil caps, and as a result oil went down about $5 per barrel. This move helped Wall Street rise ahead of tomorrow's option expiration.

Unemployment, on the other hand, seems to be on the rise. 381 thousand new initial claims for unemployment have been filed, versus the expected 375 thousand rise. This number brings once again the fear of recession. The dollar responded with flat trading throughout the day, and Forex Funnel used it wisely.

Finally, tomorrow is the quarterly options expiration day on Wall Street. It is also the rebalancing day for some S&P indices. Watch out for high trading volumes and stocks that get "stuck" on a certain price.

Good luck with expiration,
Nadav

nadavs

The Week Ahead: Third Week of June

The week opened with a sharp rise on the EUR/USD (Forex Tracer decided to take a short position and eventually profited). The dollar went down against most major currencies.

The week ahead has many interesting reports, and an interesting one is the PPI, Producer Price Index. Usually this data comes before the CPI, and it is a good indicator for it. This month's PPI is expected to rise 1%, a huge increase compared to last month's 0.2%. This is a bad sign for the economy, and it usually signals that the CPI will also rise beyond expectations.

Since this is the third week of the month, this Friday is the day when options on Wall Street expire. This means mostly boring and flat trading for the day.

Good luck trading this week,
Nadav

nadavs

Forex Market Trends

Just like anything in life, the forex market has its own trends. Although some trends are hard to spot because of the variety of currencies, there are some currencies, like the Israeli shekel (ILS), which have increased in value over many currencies. Here are the three trends a financial market can have:

The first two are well known - an up trend and a down trend. These happen when there is a clear movement of a currency to either direction. It can be in one pair or in all pairs of a currency. For example, the dollar is currently in a long down trend. To profit from an up trend, you need to buy. To profit from a down trend, you need to sell. Simple.

The third trend is sideways, or flat. This trend is the most annoying, since there is no clear movement and prices just go up and down with no clear direction. To profit from such market, you need to ride minor trends or use options. Most forex brokers will allow you to do that, and if not, ask your broker for options (make sure you know how to trade them. Options are very risky).

Good luck with your trades,
Nadav

nadavs