Top 5 Things to Know Before You Start Trading
This Thursday the GBP and JPY are trading lower while the EUR is seen higher. The Jackson Hole Symposium is taking place.
1 – Volatility Index Higher
The volatility index bounced back yesterday fueled by US Politics in the headlines again selling down the US dollar (USD) and dragging on Stocks. Fed Chair Janet Yellen is expected to boost volatility tomorrow during the Jackson Hole meeting where Central Bankers will meet to discuss global interest rates.
2 – GBP Trading Lower than USD
The Sterling was very weak yesterday against the USD, which displays just how much downside pressure there is, as the USD was not particularly strong. GBP/USD posted a 2-month low at 1.2773 with 1.2750 now being the next important support level.
3 – JPY Takes a Dip
USD/JPY took a tumble yesterday, trading down as low as 108.80 again before a mild bounce back. USD/JPY is trading at 109.26 at time of writing. The pace of the decline slowed during US session as the damage from the Trump comments on equities remained modest.
4 – EUR Trading Higher on Draghi Comments
EUR/USD traded higher, reaching highs of 1.1823 from 1.1740 after the market perceived European Central Bank (ECB) President Mario Draghi Comments as Euro (EUR) positive. Today, we expect more wait-and-see trading in EUR/USD. The market needs a ‘reassurance’ from Draghi that the ECB will move extremely slowly to trigger a meaningful correction of the EUR/USD
5 – US Equities Limit Losses
US equities managed to limit losses to 0.4% yesterday, despite US President Trump’s latest controversial comments on NAFTA and a government shutdown. Asian stock markets are mixed with China and Japan underperforming.