Copper Price Halts Decline, Oil Price Rally Gives Rise to Caution

Copper Price Halts Decline, Oil Price Rally Gives Rise to Caution 

Oil prices rallied on a second day on the back of a mild retreat in the USD and a surprised draw in U.S. inventories. Crude inventories fell by 4.9 million barrels last week, according to data from the Energy Information Administration on Wednesday. Brent oil jumped above $40 per barrel in early trading and has remained there. However there has been no change in physical supply and demand fundamentals and a global oversupply might render the rally short-lived.

Copper prices traded steady after hitting a one-month low of 2.1305 earlier this week. The Fed’s meeting minutes led to moderate weakness in the USD, which in turn underpinned metals prices. Shanghai Futures Exchange copper was steady at 36,700 yuan ($5,668) a tonne. Other risk assets like equities also posted gains today after several days of losses. In Europe, an expected rise in German economic growth in the first quarter may support metals demand.

Gold prices also traded sideways after the release of the U.S. Federal Reserve March meeting minutes. The minutes revealed that several FOMC’s members called for a cautious approach to raising rates given external (global) growth risks. This resulted in a weaker USD which propped up prices of dollar-denominated commodities. However gold prices are weighed by the prospects of a rate hike at the June meeting as “some participants indicated that an increase in the target range at the Committee’s next meeting might well be warranted”, provided incoming economic data remained consistent with their expectations.

Oil Price Holds Gains and Gold Price Sets for Weekly Advance

Oil Price Holds Gains and Gold Price Sets for Weekly Advance

Oil prices steadied near yesterday’s high of $38.30 thanks to demand optimism following firm economic indicators from the United States and Germany. This bullish sentiment held through to the Asian afternoon, although these encouraging signs could hardly counter a persistent over-supply of 1 million barrels per day. A decline in U.S. crude stockpiles reported earlier this week was mainly attributable to weaker imports and improved refinery utilization rather than a pick-up in demand. Nevertheless, the market expects oil prices to hold a steady course until an oil producer meeting in Doha on April 17.

Gold prices held up near a two-week high of $1244.2 and set to post a weekly gain after four straight weeks of declines, as the Federal Reserve's minutesexpressed caution over raising U.S. interest rates. Safe haven assets including gold picked up following losses in global equities and a broad risk-off sentiment in the FX markets. US 10-year Treasury yields hit 1.70%, the lowest level since February.

Copper prices rose to a daily high of 2.0865 after hitting a one-month low of 2.0670 yesterday, and set for its biggest weekly loss since January. Copper stocks in China have reached a near record high, from exchange-tracking stocks to private copper warehouses, which dampened demand prospects even as China’s economy is stabilising.

Reuters news reported that China may sell more refined copper into the world market this year, as local smelters found it hard to push for more domestic consumption. This prospect highlights the gloomy outlook for copper and also copper smelters in the world’s number one consumer country.

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GOLD TECHNICAL ANALYSIS – Gold prices maintained sideways trading pattern above the $1.207.6 firm support level. Although bullion scored gains this week, it remained range-bound within the area of 1207.6-1284.6. Momentum is currently biased to the upside.

Daily Chart - Created Using FXCM Marketscope

COPPER TECHNICAL ANALYSIS – Copper prices dropped below 2.1485 level to trade in the middle of the 2.0020-2.1485 range. A head and shoulder pattern is emerging as we anticipated. This range may hold into next week if prices do not extend the upside toward the resistance level today.

Daily Chart - Created Using FXCM Marketscope

CRUDE OIL TECHNICAL ANALYSIS – This week’s oil rally has brought prices close to the $39 mark by Friday. A strong upward momentum indicates higher moves to come, and possibly a contest of $39 resistance level.

Aussie Dollar Selloff May Continue on Jobs Data, Risk Aversion

Aussie Dollar Selloff May Continue on Jobs Data, Risk Aversion

Are you making this common mistake trading the Australian Dollar? 

The Australian Dollar turned sharply lower against its leading counterparts last week, issuing the largest weekly decline in three months. The way forward may continue to prove challenging as external and domestic news-flow conspires to feed selling pressure.

Employment figures are in focus on the home front, with the economy expected to add a net 20,000 jobs in March after a paltry increase of just 300 workers in the prior month. Australian economic news-flow is deteriorating relative to expectations once again after a brief period of stabilization, warning that analysts are overestimating the economy’s vigor and opening the door for a downside surprise.

Meanwhile, realized outcomes on US data have steadily improved relative to consensus forecasts since early February. This may make for upbeat results when retail sales, CPI and consumer confidence figures cross the wires next week. Such results may feed Fed rate hike bets after minutes from the March FOMC meetinghelped refocus investors on incoming fundamentals.

Firming RBA rate cut expectations on the back of soft jobs figures coupled with the likelihood of risk aversion triggered by returning Fed tightening fears bode ill for the Aussie Dollar. The latter theme may be further compounded by the onset of the first-quarter corporate earnings reporting season. Indeed, earnings per share for S&P 500 companies are seen falling 7.9 percent year-on-year.

Chinese event risk represents a wild card. GDP growth is expected to have slowed to 6.7 percent year-on-year in the first quarter from 6.9 percent in the final three months of 2015. A recent string of upside surprises warns that the world’s second-largest economy may be in better shape than markets are anticipating. The Australian unit may find a lifeline if this proves to foreshadow an upside surprise.

Forecasts for China, Global Growth Top Fundamental FX Drive This Week

Forecasts for China, Global Growth Top Fundamental FX Drive This Week 

The economic docket will fill out with critical event risk ahead. At the top of the list will be 1Q Chinese GDP along with the IMF's forecasts for growth and financial stability for the world's most important regions.

US Dollar Forecast – Dollar to Move from Consolidation to Trend, But What Sparks the Move?

The Dollar was little changed this past week – which is an impressive turn of events for the currency considering the previous bouts of painful selling.

British Pound Forecast – British Pound Risks Near-Term Correction on Rising U.K. Inflation

The Bank of England’s (BoE) April 14 policy meeting may spur a limited market reaction as the central bank is widely anticipated to retain its current policy ahead of the referendum in June, but signs of sticky U.K. inflation accompanied by dovish comments from Fed officials may generate a near-term rebound inGBP/USDas U.S. interest-rate expectations falter.

Australian Dollar Forecast – Aussie Dollar Selloff May Continue on Jobs Data, Risk Aversion

The Australian Dollar may continue downward after last week’s losses as a soft jobs report boosts RBA rate cut bets while US economic and earnings news-flow drives risk aversion.

Chinese Yuan (CNH) Forecast – A Heavy Calendar Has Chinese Yuan at Risk from Home: GDP, CPI Due

The onshore and offshore Yuan rates moved in opposite directions this past week: the offshore Yuan (CNH) held a bearish position against the US Dollar while the onshore Yuan (CNY) closed slightly higher on Friday.

Canadian Dollar Forecast - Strong Employment Report Primes CAD for Bank of Canada

The Canadian Dollar has been on a run that likely has more gas in the proverbial tank that could mean furtherCADgains.

Gold Forecast – Gold to Remain Supported on Dovish Fed- Bullish Invalidation 1193

Gold pricerallied for a second consecutive week with the precious metal advancing 1.26% to trade at 1237 ahead of the New York close on Friday.

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China GDP and IMF Warnings Set to Revive FX Volatility, Trends

China GDP and IMF Warnings Set to Revive FX Volatility, Trends

Talking Points:

• Where this past week was a struggle to develop fundamental trends, the period ahead may encourage them to flourish
• Top event risk on the docket ahead includes Chinese 1Q GDP, the start of US Q1 earnings and US inflation figures
• Both underlying risk trends and relative monetary policy will be presented with capable fodder to fuel potential trend

See the DailyFX Analysts' 2Q forecasts for the Dollar, Euro, Pound, Equities and Gold as well as our favorite 2016 trading opportunities in the DailyFX Trading Guides page.

Market developments this past week promise (or threatened depending on your side of the market) both risk and Dollar trends this past week. Both fell short. Next week, however, will be less encumbered. Ahead, we are looking at scheduled event risk that hits upon key themes with influence over both volatility and potential trend development. With the S&P 500 carving out a head-and-shoulders pattern, speculative sentiment watchers will be on constant alert for a systemic decline in risk positioning. For the Yen crosses, this would be a clear opportunity if it weren't also for the threat of Japanese intervention aiming to halt appreciation in the local currency. Event risk to keep tabs on for this systemic theme includes high-profile risk like the 1Q Chinese GDP, the start of the Q1 US corporate earnings season and the IMF's update on global growth forecasts. On the monetary policy front, the US docket is particularly stocked with key event risk. Inflation statistics will amplify the Fed's supposed favored wage measure in the University of Michigan confidence report to shape rate expectations. We discuss the expected change in market conditions between last week and the one ahead as well as the trade opportunities it presents in this weekend Trading Video.

How to Trade Forex after a Major News Release

Article Summary: News trading often brings the biggest moves of the month. Because of this, it’s no wonder that trader’s seek out high importance news events to try and catch a big move. However, if you don’t have a solid plan for trading the upcoming event, you’re likely better off not trading at all. Here is a plan to make sure you’re ready when a big move comes your way.

“Don’t think about what the market’s going to do; you have absolutely no control over that. Think about what you’re going to do if it gets there. In particular, you should spend no time at all thinking about those rosy scenarios in which the market goes your way, since in those situations, there’s nothing more for you to do. Focus instead on those things you want least to happen and on what your response will be.” – William Eckhardt

Have you ever wondered why markets move so much before a news release? Quite simply, it’s because of massive amount of traders are entering or exiting based on the news release and these traders want to do so at the price they feel is best. This causes a relatively large move immediately following a news release.

Now, trading the news is exciting. However, it’s also risky due to the large moves that follow a news release and because of these moves you need to be well prepared ahead of time if you’re interested in trading around big news events. First, it’s important to cover how to know when a big news event is coming out.

A Quick Primer on the DailyFX Economic Calendar

The DailyFX Economic Calendar is a key tool to help make you aware of when a High Importance event is coming out like the Federal Reserve Minutes or a Bank of Japan Rate Decision. To find the news that will most likely move the market, you should adjust the filter to only see High Importance events so that your calendar isn’t flooded with news that has little probability in moving the market. Once the filter is applied, you can begin looking for news events on currencies that you’re trying to find good opportunities in.

5 Great Ways to Learn Stock Trading as a New Investor

5 Great Ways to Learn Stock Trading as a New Investor

New investors taking their first steps towards learning the basics of stock trading should have access to multiple sources of quality education. Just like riding a bike, trial and error coupled with the ability to keep pressing forth will eventually lead to success.

One great advantage of stock trading lies in the fact that the game itself lasts a lifetime. Investors have years to develop and hone their skills. Strategies used twenty years ago are still utilized today. The game is always in full force.

So for new investors wanting to take their first steps, I offer 10 great answers to the simple question, “How do I get started?”

1. Open a stock broker account

Find a good online stock broker and open an account. Become familiarized with the layout and to take advantage of the free trading tools and research offered to clients only. Some brokers offer virtual trading which is beneficial because you can trade with play money (see #9 below). A great tool for comparing online brokers can be found at StockBrokers.com.

2. Read books

Books provide a wealth of information and are inexpensive compared to the costs of classes, seminars, and educational DVDs sold across the web. Here on the site we have a full list of 20 great stock trading books for investors to consider. My personal all-time favorite is How to Make Money in Stocks by William O’Neil, founder of CANSLIM Tradingwhich is pictured below.

3. Read articles

Articles are a fantastic resource for education. Our free Stock Education page here on StockTrader.com lists over 100 unique investment articles broken down into categories. Recommended websites for investment education are investopedia.com and of courseGoogle search.

4. Find a mentor

A mentor could be a family member, a friend, a past or current professor, co-worker, or any individual that has a fundamental understanding of the stock market. A good mentor is willing to answer questions, provide help, recommend useful resources, and keep spirits up when the market gets tough. All successful investors of the past and present have had mentors during their early days.

Forums can be another source for question and answer. Two recommendations includeElite Trader and Trade2Win. Just be careful of who you listen to. The vast majority of participants are not professional traders, let alone profitable traders. Heed advice from forums with a heavy dose of salt and do not, under any circumstance, follow trade recommendations.

5. Study the greats

Learning about the greatest investors of years past will provide perspective, inspiration, and appreciation for the game which is the stock market. Greats include Warren Buffett,Jesse Livermore, George Soros, Benjamin Graham, Peter Lynch, John Templeton and Paul Tudor Jones, among others. One of my favorite book series is the Market Wizards by Jack Schwager.