Forex Update: The Good and the Bad
Bill Poulos began trading stocks in the early seventies while working as an executive for General Motors. Poulos learned valuable lessons from his mistakes trading in the markets. In 2001, Poulos retired from General Motors and he and his son, Gregory, founded Profits Run, Inc. The company distributes materials to assist investors in making smart trades while minimizing risks. Bill is the author of books on finance and economic trends in the markets. Poulos was recently featured in Forbes where he discussed blockchain and investing. He contributes to several online platforms on the most up to date investment strategies. In 1969, Bill married his high school sweetheart, Karen. They live in Wixom, Michigan where Profits Run is headquartered.
There was a lot of activity this week beginning with the US considering delaying tariffs against Mexico. Mexico seems to have begun to taken somewhat of a harder stance against illegal immigration from their southern border trying to keep them from spilling into the US in the north. The US may delay tariffs against some Chinese products as well while the Chinese threatened to use the prescription drugs that it sends to the US as a negotiating tool. These events and others have helped to roil the US stock market with it dropping quickly on bad news and then recovering nicely on good news. The net result is that it gained back nearly two thirds of what it lost in the pullback that occurred throughout May.
The Forex trading week began in a normal enough fashion with EUR/USD rolling nicely as EUR took back some of what it lost to the USD in the previous weeks. The first bump in the road came on Tuesday morning when the head of the Fed spoke. The pair whipped back and forth until it finally calmed down and resumed its slow upward trek. The next bump came on Wednesday leading up to the US employment numbers and then for a time after the release. We experienced a hard drop followed by a higher high and then a quick drop finally stabilizing late in the afternoon on Wednesday, but of course the fun wasn’t over yet. Thursday morning provided us with the most volatility of the week during the European Central Bank press conference. Anytime one of the top people from a central bank speaks there can be a lot of volatility and this press conference didn’t disappoint in this regard. The pair spiked both up and down quickly in a 100 pip range until finally flattening out regrouping for some Friday fun. Friday morning provided us with some fairly bad US employment numbers, which were expected based upon information that was released earlier in the week, but that gave the pair a nice quick 80 pip boost before flattening out and finally calming down. This turned out to be a busy week for this pair with the result being that the EUR took just under 2 big numbers from the USD.
While the EUR was taking advantage of the USD the USD’s onslaught against the GBP finally subsided with a mostly sideways move for the week. USD held up well against the JPY but the CAD had its way with it. It gave some back to the AUD and a good amount to the NZD and the CHF.
Not only did the EUR take advantage of the USD it continued to take from the GBP and JPY and some from the AUD. It was volatile against the CAD ultimately giving some back to it with the NZD taking some as well.
The never ending Brexit situation and general political turmoil in the UK didn’t help the GBP much as it lost against the CAD. It did finally hold its own against the JPY and AUD but it did do a give up to the NZD. Maybe we’re seeing some stabilization with the GBP beginning to fight back.
The big winner may have been the CAD holding up very well against almost all trading partners showing allot of resiliency and stability.
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