The Australian dollar has remained trapped in a sideways trading band for one year and there is little sign of a strong change in the trend. » Read More
The Shanghai Index consolidation retest of the uptrend was stronger than expected. » Read More
Sometimes it more useful to recognize relationships rather than attempt to explain them. The performance of the KOSPI is a case in point. There are two aspects of behavior, which point the way to wider profits in the ASEAN region. Just why these behaviors occur, and why the relationships have been established is a difficult question to answer.
The Australian Dollar is a story of remarkable strength – almost death defying strength. The move above parity with the US dollar is severely damaging Australia’s export competitiveness. Moves above $1.05 are causing serious pain that is not offset by the rise in commodity prices.
The more cynical observers are suggesting it was no surprise that the Australian Government rejected a takeover of the Australian Stock Exchange from an Asian stock exchange. The rejection was also clear for many months on the chart of the ASX. The ASX chart in November 2010 showed this deal would fail.
The world environment has a crisis in Japan and a crisis in the Middle East. In this situation, it is common for many investors and traders to buy more gold This has not happened. The price of gold on the COMEX gold chart has fallen from $1440/oz to near $1420/oz.
The pattern of retreat and reversal with the euro-dollar follows similar patterns in equity markets. Similar patterns are more fully developed and this suggests a continuation of the current uptrend towards $1.49. This trajectory is inhibited by several factors.
Fear ripples easily through financial markets, quickly rolling over fact and turning into ill-informed speculation. A downside of wide-spread instant news coverage – and internet coverage from mobile phones – is that a false rumor or an ill-informed opinion is spread just as quickly as intelligent and informed analysis. Unfortunately viewers are not always equipped with the skills needed to separate fact from fiction. Its one of the reasons they turn to CNBC.
The Japanese earthquake, tsunami and nuclear plant problems have inflicted a massive human toll. The effects will continue in the Japanese market for months and years to come. At the time of the Kobe earthquake in 1995 the Nikkei was in a much strong position than it was in 2011, prior to the current earthquake.
Which is better – gold or silver? Often consigned as an industrial metal with limited value, silver has outshined gold in the past 18 months. Between July 2010 and January 2011 the COMEX silver futures price rose by 72 percent from $18.00 to $31.00. Silver outperformed gold by more than three times and it continues to do so.
Oil continues to be the front and center of investors' focus this week, with nymex crude surging beyond the $100/barrel mark as unrest in the Middle East sparks concerns about possible supply disruptions.
It has taken 16 months, including a significant retracement, but the Nasdaq has added more than 100 percent since the 2009 lows. It’s an excellent performance if we ignore the pullback from 2550 to 2100 in the middle of 2010. The key question whether the index continue its runup, or if another significant pullback and consolidation are a higher probability.