Two Brexit related stories last week, showed how Britain is currently having its cake and eating it. The first had to do with the High Court decision to subject Brexit to a parliamentary vote. The court ruled that article 50 – the EU article that must be activated by any country wishing to leave the union – cannot be invoked without parliamentary support. The second story had to do with the sharp increase in tourism to London that Euro Star reported. According to reports on Bloomberg, Euro Star saw an 18% increase in the amount of passengers travelling from Paris to London.
One of the most volatile currencies on earth is facing more devaluation. The Venezuelan Bolivar, which had a measure of stability for most of the year, is now quickly depreciating. Black market prices for a single US Dollar are expected to reach the $1,700 Bolivar mark before the end of the year. This is partly due to the abysmal performance of the Venezuelan economy, which contracted by about 10% this year, and other factors that are not as publicized. Certainly the decline in oil prices, oil infrastructure investment and the lack of production in other sectors, have taken a toll on the Venezuelan economy. Nevertheless, political unrest and inflation are pushing the US Dollar to new heights, prompting people to pay whatever it takes to acquire an asset that will keep its value.
Apparently when OPEC finally agrees on a cut in production, its members cannot agree on the production baseline from which cuts must be calculated. Additionally, meetings between OPEC members and non-OPEC oil producers, have not yielded an agreement either. As a result, oil production prospects remain intact. The price of oil plummeted on Monday, with WTI dipping below the $47 USD mark for the first time since the end of September.
The 4% drop in WTI prices on Monday, affected the currencies of non-OPEC producers. The Colombian peso dropped to a 2 month low, finishing the day at $3,005 COP per USD. The Russian Ruble hit a 1 month low, closing at $63.4 RUB per USD. Both countries will probably be unable to balance their budgets, due to irreplaceable loss of government oil-related revenue. read more…
Oil traders should hold those bulls. The fundamentals of oil markets have not yet changed, and the price of crude reflects that. Demand is pretty stagnant, and supply is abundant, which means prices have really struggled to hold their gains. WTI has been unable to stay above the $50 USD mark for long, and prices have just dipped below $50 for the first time since October 7th – prices closed 6 cents below $50 on October 17th, but that slight drop was not very significant.
In fact, the WTI price curve is now developing a downward trend. Price has been going down steadily since October 21st, despite turmoil in Venezuela – and rumors of PDVSA’s default – and more recently an attack on a pipeline in Nigeria. Event like these would have probably sent WTI prices up just a few years ago, but the lack of enthusiasm about oil prices seems to stem from longer term concerns about demand, and to a lesser extent from OPEC’s historic inability to commit to production cuts. read more…
2016 is only 3 weeks old and it has already managed to redefine the concept of growing pains. It seems that growth will not come despite all the pain. Investors have been unable to find a safe haven for their money so far, triggering suspicions of another large scale financial downturn. With the memory of the 2008-09 recession still fresh in our memories, it is necessary to be prudent and find the value hidden in all this turmoil.
Of course, the whole debacle originated in China and the various North American oil patches. The former is facing an economic landing, which however soft it may be, is spooking investors. The latter made oil so cheap, it triggered a pro-cyclical reaction from traditional producers trying to defend market share at all cost. The result, an economic downturn that seems to be spiraling out of control. read more…
Major Events of Last Week
Prospects that the US Federal Reserve will hike interest rates before the end of 2016 received a boost last Friday when the US Consumer Price Index (CPI) rose at a faster pace than expected during August. Declining oil prices were countered by sizeable increases in healthcare and rent costs enabling inflation to advance ever closer towards the Fed’s designated target of 2%. Oil prices, in fact, recorded their lowest values in practically two weeks last Friday after both Nigeria and Libya resumed near-maximum production following months of extensive disruption. The leading US indices slumped towards the end of last week illustrated by the Dow Jones Industrial Average plummeting by 76 points; the S&P500 dropping by 7 points and the NASDAQ falling by 4 points. read more…
We’re proud to launch our long awaited dedicated Forex section on the site.
Even though we’ve been doing 1-on-1 training with many of you for awhile, we hadn’t published Forex-only materials on the TradeOpus site; until today. We will be adding articles all the time and an education center with Forex basics and training. We’ll also soon be turning our Forex strategy section with full explanations and review of different trading strategies.
There will also be some surprise content for our loyal readers and some exciting giveaways over the next few weeks, so stay tuned. Make sure to register for our newsletter (on the right of this page) to not miss out!
To get you started here are some articles about Forex basics and common mistakes traders make:
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TradeRush has joined in the Bitcoin craze and is now accepting deposits via the coin on their award winning platform.
TradeRush was one of the first brokers to add Bitcoin as an asset for trade on their platform earlier this year. Many of the Spotoption brokers also offer trading on Bitcoins under the “currencies” section of their sites. But still not many are accepting deposits via the cryptocurrency.
For many hardcore Bitcoiners the deposits, trades and withdrawals need to be in Bitcoins to get their attention. And this is what TradeRush is betting on. They hope to show that they understand the market better and offer a full crypto experience for those who are part of the Bitcoin economy. read more…
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