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Oil Price Weakens and Dollar Gives Ground

Binary.com Daily Financial Review August 3rd 2016

oil price weakensMorning Report: 09.00 London

  • This morning, as the oil price weakens with oil set to test $40, the dollar index is unchanged after yesterday’s of heavy selling.
  • There is now a lot riding on Friday’s Non-Farm Payrolls and the Bank of England’s decision on whether to fuel Brexit-based panic by unnecessarily tampering with interest rates.
  • (As an aside, in the ’90s the UK’s monetary policy was made up of what came to be known as ‘the six wise men’. After the usual time delay the minutes of a meeting were released which showed that three of these gurus had voted for a rate cut, three for a rate rise. The Milton Friedman/Gordon Pepper monetary base, i.e. M0, is what should be regulated but the problem there is that politicians can not then use monetary policy as an election tool.)

oil price weakens

oil price weakens

 

 

  • The yen picked up a lot of this dollar weakness, with the USD/JPY and other dollar pairs slipping lower.

oil price weakens

oil price weakens

oil price weakens

oil price weakens

 

  • The dollar pairs performed well yesterday and are holding yesterday’s gains with the exception of the Australian and New Zealand dollars.

oil price weakens

oil price weakens

 

 

Coming up today:

  • Coming up today, we have UK services PMI at 09.30.
  • This is followed by ADP non-farm employment change at 13.15.
  • Then we get ISM Non-Manufacturing PMI at 15.00……
  • …….and crude oil inventories at 15.30.

Trade Idea:

  • The AUD/JPY has underperformed other yen pairs of late as the Aussie’s reliance on China weighs heavily. With the yen in extreme demand and China’s economy easing, we could see further downside on the AUD/JPY.

 

oil price weakens

A good way to play this is a LOWER trade predicting that the AUD/JPY will close below 76.00 in 21 days for a potential return of 146%

oil price weakens

fed sets course

N.B. This financial market report is intended for educational and information purposes only. It should not be construed as investment or financial advice and you should not rely on any of its content to make or refrain from making any investment decisions. The views expressed in this report are those of the author and do not necessarily reflect the views or position of Binary.com. Binary.com accepts no liability whatsoever for any losses incurred by users in their trading. Binary options trading may incur losses as well as gains.

 

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