Why You Might Fall in Love with CFD’s

Why You Might Fall in Love with CFD’s

World

Author Soteris Phoraris of easyMarkets

Yes, its Valentine’s Day and there are many different types of love – the love between a person and their car, the love between two people and the love you will have for CFDs after you read this article!

Why am I so confident about this fledging romance, like a financial markets cupid? Let’s find out.

Up? Down? Who cares?!

CFDs are financial products that follow the price of an asset. The good thing is that it allows you to follow it both when it’s going up and when it’s going down.

It’s understandable that most people forget that they can still have a positive outcome even when the markets are dropping with CFD’s. I mean the media doesn’t help, here are some recent market headlines courtesy of Bloomberg and Reuters:

“U.S. Stock Rally Falters as Yen Leads Haven Gains: Markets Wrap”

“Volatility Doesn’t Come Without Economic Consequences”

“Global Stock Recovery Falters”

They don’t really inspire you to say, “let’s go to the markets!” but the thing is that every movement, positive and negative, can be used with CFDs.

You can “short” CFD’s which essentially means you expect the asset to drop or continue dropping. This also known as selling a CFD. “Buying” the CFD mean you expect it to increase in price from the point you purchased the asset.

With a CFD you can sell high and the exit low, which will work just like the infamous adage, buying low and selling high. Ignore the jargon – in both scenarios that’s what you wan

Love is in the air

And that is why CFD’s deserve your affections. Stop look affectionately and all starry eyed at Bitcoin’s crazy bull run, its less attractive sibling Bitcoin’s downtrend can be just as appealing.

With the right kind of strategy, going short can be immensely satisfying. So, feel free to open a bottle of wine, put your favorite sweat-suit on and go short on your favorite instrument. It might be non-traditional but what can we say, love works in mysterious ways!

And so do the markets, so remember no matter what type of trading strategy you choose, always protect yourself, with the risk management tools available such as stop loss and price notifications.

Just another little piece of advice, although volatile markets are seductive, they remain well… volatile meaning they could turn on you at any minute. This Valentine’s Day remember to trade like you love – responsibly.

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

Risk warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

Will 2018 finally see Gold’s shine return?

Will 2018 finally see Gold’s shine return?

World ,

James Trescothick, Senior Global Strategist, easyMarkets

It’s that time of the year again when many analysts chuck their hat into the ring and try to predict the next 12 months.

You can hear it already, the shouts of what is the new bitcoin, whether the GBP will hold its own despite the ongoing Brexit drama and when the Stock market bull run will finally stop.

For me, I am going talk about an old favorite of mine and that is gold.

Gold and I have a pretty close relationship.  In fact, when I first started out in this industry, Gold options were the first asset I got involved with and I can remember it trading around $684 oz. It was at the dawn of the financial crisis and my firm at the time was predicting gold to skyrocket $1000 OZ.  And I remember the excitement that filled our office in August 2008 when it finally breached that level.  Ok, it then fell back a little but after the financial crisis took hold it carried on its bull run hitting its peak of around $1920oz in September 2011.   After that the next 4 years saw it free fall hitting a low of $1042 in December 2015.

Since then Gold has been stuck in a range, trading between $1375oz and $1124oz.   Now will 2018 be the year for Gold to finally break through that range?

Three weeks into the start of the year have seen a fairly bullish rally, however historically speaking January has often been a good month for the yellow metal, but this January it has hit a 17 month high of $1365 oz on 25th January. So is there good reason for gold bulls to start getting excited?

Overreaction?

The size of the bull run so far is no greater than previous January bull runs.  So far this month Gold has moved higher by around $50 and at the time of writing it is currently trading around $1358.32.

The past two January’s have seen similar moves, with it opening in January 2017 at $1144.81oz and closing the month out at around $1208 oz with January 2016 being slightly more impressive with its open price at $1057oz and the close at around $1119.15oz.  So really the movement at present is nothing for the bulls to shout about.

As well that Gold’s jet propulsion skyward actually started around the December 20th, when it posted gains for eleven sessions in a row till gains being pared on January 5th.  So really is this January’s 17 month high really cause to celebrate?

Greenback falling flat on its face

Now there is something which can fuel the bull’s enthusiasm for gold to return to its dizzy heights and that is the US Dollar’s recent collapse against the majors which can visibly been seen with the Dollar index trading at the lowest level since January 2014.

As every gold trader knows a weaker dollar often results in higher gold prices due to their ongoing love/hate relationship.  In fact, USDs dramatic decline this year has seen other currency pairs hit levels not seen for nearly 4 years with the likes Euro/USD at the time of writing trading at $1.2462.  With the ECB along with BOI toying with the idea of cutting back on monetary stimulus and the UK economy showing signs of being stable and the hope that a Brexit deal will be made, there are clear reasons why the USD is struggling against the majors but eventually this will surely turn around especially with the FED likely to raise rates again this year.

However, Treasury Secretary Steven Mnuchin’s address to reporters in Davos on Wednesday 24th January sparked the markets to life as he mentioned that “a weaker dollar is good for trade” though he later tried to backtrack.  The fact that a US Treasury secretary is actually embracing a weaker greenback is surprising traders with the long standing rhetoric of previous US Treasury Secretaries have favored a stronger greenback.

Now no one can say for sure what’s a weaker USD but with recent trades tariff’s imposed upon South Korea and China, the concerns of a potential trade war are very much alive and a weaker USD would play a key part in winning any sort of trade war.

How about the stock market?

The stock market is still very much enjoying its bull run with the SP500 and Dow Jones both hitting all-time highs.  Now so many speculators out there have said that eventually we will experience a crash and at some point we must, but no one has really said when they believe this will finally occur.  A weaker USD can certainly help the bull run to keep going, however if we do end up having a full blown trade war that will not help the stock market at all.

With the stock market still enjoying its record highs so far this year it hasn’t stopped Gold which is of course a safe haven and really should only benefit when times are bad from hitting the before mentioned 17 months high.  So could it also be a case that there are those big hitters out there moving into gold preparing for the eventual crash?

One method of trying to read market sentiment is by looking at the last COT report which was published on 16Th January, which shows that the merchants are hedging themselves with 212,879 short positions in gold where the speculators have 227,373 long positions in gold, hinting at a potential overall bullish tone.

Where could Gold possibly go?

Now I have read wild claims that some believe we could see the yellow metal rise to its all-time highs once again. But to be fair, back in 2011 when we hit an all-time high of $1920 we were still feeling the aftershocks of the financial crisis and witnessing unrest with the Arab Spring.  Currently we are seeing economic revival across the globe and despite the occasional spat between North Korea and US, thankfully not so much potential conflict.

The other matter which weighs on my mind is that even though the USD is suffering massively, GOLD has yet to pass the key level of $1400oz, but instead at the time of writing still unable to break through the $1375 level.

However, due to the points I have made about the USD weakness, the threat of a trade war and the anticipation that we might see the stock market finally experience a correction I can see gold push above the $1400 level at some point and depending on how it may react to more rate hikes this year from the FED, I can also see the possibility of it approaching the $1500 level before the year is out.

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

Risk warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

CES 2018 – How will new technologies affect markets?

CES 2018 – How will new technologies affect markets?

World

Author: Soteris Phoraris

Market Commentator for easyMarkets

We frequently hear the idiom “The future is now!” especially in the age on the cusp of artificial intelligence, autonomous robotics, nanotechnology, mass adaptation of alternative energy and genetic medicine. We undeniably live in a very technologically exciting era and these breakthroughs definitely have the potential to completely change the way the world fundamentally works.

In honor of CES 2018 (Consumer Electronics Show) which just finished, I thought I’d take the time to look at technology with a different scope. I thought I’d consider the question most traders would ask when faced with change on a large scale: “how will this affect the markets?”

Well let’s take a look at how the markets were affected by significant technological advances in the past, what survived, what went up in smoke because of them and ultimately try to see what could be affected by the latest technological break-throughs.

History: Coal vs. Oil

The first type of energy source humanity had at its disposal was itself, I know that sounds redundant, but muscle power was the first type of locomotion – which I hear is really tiring. Luckily, we domesticated animals, found that the black rock stuff underground could be burned to create tons (joules actually) of energy and that the black goop erupting from underground could create even more. During the industrial revolution around the beginning of the 20th century, coal was the go to fuel and there were millionaires made because of it. Name any disgustingly wealthy family that existed before and during the industrial revolution and I can guarantee they had a hand in coal – Rockefellers? Rothschilds? Yes, as recently as the 2000s.

Still to this day coal mining is a vital form of income and source of employment for certain locations around the world – much of a certain person’s campaign (which shall remain anonymous) was based on the preservation of so-called “coal belt” jobs in lieu of an international environmental preservation pact – but I digress. Eventually oil came to replace coal as a primary energy source, due to its transportability, availability – but the true catalyst (!) for the mass adaptation of oil over coal was the internal combustion engine. The ease of having a liquid tank and a self-feeding engine instead of constantly having to shovel coal into a steam-engine helped this fuel-source immensely.

Although most people heavily invested in coal reinvested in oil, the shift did cost jobs within the industry, but new industries emerged covering the need for skilled or semi-skilled labor.

We have seen multiple technologies which could replace fossil fuels although none have proven to be as efficient or economic as their globe destroying counterparts. Hydrogen fueled cars seemed like a solid competitor, but the need for specialized infrastructure and their inability to compete autonomy-wise with gasoline driven cars has greatly stifled its popularity and mass adaptation. If a fuel type emerges or is optimized to be more efficient, more affordable and ultimately more convenient, then we might see both oil and coal go the way of the Dodo.

Electronics – Gold Fever

Although gold is still primarily used for jewelry, 10 -12% (depending on the source) of the world’s gold supply goes to the production of technology. The reason that percentage isn’t higher is probably due to the fact that a third of the gold used in new technology is actually recycled. Of course, we know gold is finite whereas technology continually evolves, thus the demand for gold is constantly increasing. For example, Mathew Neurock and Robert J. Davis of the University of Virginia have found a method using gold, to create “bio-renewable chemicals” that could replace petroleum based ones.

Of course, even gold’s use in tech might be reversed, with new material innovations such as graphene, which is promising to completely redefine circuit paradigms of today. This statement is going to seem superlative – but graphene is the most conductive material in the world, it is stretchable (which flexible circuits have been the holy grail of the tech industry for decades), 200 times stronger than steel and one of the thinnest materials known to humanity. It’s also impermeable, meaning it can create a protective, conductive but still stretchable protective layer over, well theoretically anything. Imagine a housing that is also the circuitry and battery of a smart-phone.

Yes, yes ‘how will this affect the markets?’. Currently, producing graphene is prohibitively expensive – the company or institution that manages to find a cost-efficient way to produce this hyper-material, and the foresight to patent it, it will at least initially, dominate the market – like DOW chemicals and Teflon, Westinghouse with alternating current infrastructure and Tesla with electric cars – on that note…

Autonomous cars everywhere

It seems that this year’s CES was dominated by self-driving cars, with a few other alternative fueled non-non-driverless cars (drivable?) including Hyundai’s hydrogen fuel cell car and Chinese manufacture’s first foray into electric cars – Byton.

Honda seemed to be the break-away autonomous vehicle producer, with two offerings, the awkwardly named 3E-D18 which looks like a futuristic four-wheel off-road vehicle which is a platform for various tools depending on the application from agriculture to bomb-disposal. Honda also introduced its NeuV which is slated as a “ride sharing” vehicle. Beyond the most evident shift these vehicles create (most are electric instead of using fossil fuels) something which can practically redefine the automotive industry: some analyst believe that autonomous vehicles will make car ownership a thing of the past – creating a model like bike-sharing, with the difference that you will not need to go to the “sharing” terminal, but the vehicle will come pick you up.

Companies such as Uber and Lyft will need to adapt to this technology and already have to a certain extent, Lyft has permission to test self-driving cars in California and Uber is testing autonomous cars in Toronto. Uber is taking it a step further by working with NASA to introduce autonomous air-taxis by the 2028 Olympics in L.A. pushing the world one step closer to the worlds seen in Blade Runner and the 5th Element. OK maybe even Demolition Man, which lets hope doesn’t feature Wesley Snipes with a bleached flattop – just the self-driving cars.

Smart Homes

As we saw from CES 2018, companies want to make your dumb home smarter. The usual suspects Amazon and Google presented their respective smart home tools, but less traditional tech proposals by the likes of Kohler with voice-controlled shower, that can be programmed to play the music you want and the lighting you prefer when getting squeaky clean. Another addition is an Alexa “powered” mirror and a toilet that would make a luxury car blush in inadequacy – it has feet warmers, a heated seat, mood lighting (I wonder if you can make your bathroom look like an EDM music festival if you combine it with the smart-shower), music and a bidet. Toilet talk aside though, there was a myriad of smart home devices, remotes, hubs and even robotic companions that function as smart home remotes.

So how is all this relative to markets and traders? Smart tech, great you say, we’ve seen it flounder and fail for half a decade (or more anyone remember the Palm Pilot?) – but don’t look at the tech, look at the companies and how many are investing in this.

The industry generally responses to the request of consumers, they want smartphones? WE’LL GIVE THEM SMART EVERYTHING. That might be hyperbole but shows like CES can reveal industry trends – helping you discern which companies are riding the wave of innovation and which are just resting on their laurels (or even worse, brand name).

You can also see general industry trends revealed, for example techradar.com noticed a significant lack of cameras at the show, but as mentioned above the show was inundated by smart home devices. Another bit of industry news revealed was the fact that Huawei was dropped from a partnership with AT&T, but has established strong retail relationships with the likes of Amazon, Newegg, Microsoft Store and Best Buy – which still makes the launch of its flagship device State-side viable.

This kind of news may seem insignificant but we’ve seen company stocks fluctuate wildly because of industry news and trends. Just look at how Apple’s stock spikes before each major release announcement and then corrects to normal levels or drops lower than before depending on consumer reaction and response. During Samsung’s Note 7 battery overheating and exploding troubles – which ultimately caused the company to recall the entire run of the device a few months after its release – extreme example I know – but just on the report of batteries failing and turning pockets around the world into impromptu fireworks shows, pushed Samsung market value down by an astounding $7 billion. This was before the company even admitted that the device had problems, saying that quality control issues where causing shipping delays.

News is important and if investors are listening in to Central Bank officials’ speeches for hints, even if the speech in question isn’t even related to the Bank’s policy-making, why not look to other sources too. The news is out there – you just have to be creative how to find it.

 

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

Risk warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

The Santa rally – will Christmas bring even more gifts for Bitcoin traders?

The Santa rally – will Christmas bring even more gifts for Bitcoin traders?

World
  • December is traditionally one of the best months of the year for shares (Stock Market Almanac)
  • 2015 and 2016 both saw Bitcoin increase in value during December (easyMarkets)
  • CBOE and CME bitcoin future contracts may already have been priced in (easyMarkets)

Not unlike its name sake, there are those who believe in the Santa rally and those who don’t.  The supposed “Santa rally” tends to occur in the last week of December, when the market can see a sudden surge in stock prices. Many have tried to explain this burst of activity in the market. Some put it down to the general cheer of the season, others say its down to tax considerations and individuals investing their Christmas bonuses.

Is the Santa rally real?  Well, Wall Street certainly hopes that people believe it is. However, while many traders believe it to be true, there are others who think it’s just a myth and that it’s just another saying in line with the infamous “Sell in May and go away.”

However, according Stock Market Almanac, December is one of the best months of the year for shares, with the FTSE in particular rising 74% of the time in December since 1970.

Of course, as any analyst worth their weight in gold (which isn’t much these days – have you seen gold prices lately?) would tell you, past performance never guarantees future results.

“When it comes to cryptocurrencies, the question is not only whether you believe in the Santa rally, but also whether it’s something that may have come early this year for those who trade bitcoin. On 1 December, Bitcoin was around $9,867 per coin. At the time of writing, it’s at an incredible $16,526, which is an increase of more than 40%. It certainly looks like Santa has come early this year for Bitcoin traders.”

James Trescothick, Senior Global Strategist, easyMarkets

 

While Bitcoin is far too young really to give any hint of a potential Santa rally effect, those looking back to December 2015 will recall that it started the month at around $360 per coin and closed the month out at $418 per coin. It did something similar last December too, opening the month at $725.40 and starting January at $955.90 per coin. On the flip side of the coin (pun intended) you could look back at the end of 2013. In November of that year it went on its first impressive bull run, hitting $1,087, only for it to collapse in December to a low of $384 before closing the month out at $670 due to Chinese regulators’ intervention.

Many are saying this latest bull run is due to the fact that both the CBOE and the CME are launching their bitcoin future contracts. CBOE went live on 10 December, with CME due to follow on 17 December. The fact that these two exchanges have accepted Bitcoin has given further evidence that legitimizing Bitcoin as an investment could be just around the corner.

“When both exchanges go live with their Bitcoin future contracts, it could shower the Bitcoin market with more gifts, pushing it higher to close out a record breaking year. However, could the crypto market react in the same way as the forex market sometime does and “buy the rumour and sell the fact,” essentially dropping Bitcoin when this happens? Also, how will the Bitcoin market react with the opportunity for future traders to short their Bitcoin contracts on these exchanges?”

James Trescothick, Senior Global Strategist, easyMarkets

 

Nobody could really have predicted what has happened to Bitcoin in 2017. Only time will tell how it will bow the year out. However, December’s run so far is nothing short of spectacular.

It may well be that eventually this bubble will burst. The recent rush into the market has been by those looking to profit and not to use Bitcoin for what it was designed for. When the time comes to cash out, there may be issues with getting it exchanged back to a physical currency and maybe even with banks accepting the transfer.

For now, Bitcoin continues to enjoy its run. Let’s just hope for those bitcoin traders out there that when it comes to the final week of December, the crypto market isn’t overly stuffed on its own indulgence.

 

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

Risk warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

Japanese elections – it’s business as usual with easyMarkets

Japanese elections – it’s business as usual with easyMarkets

Uncategorized

While most brokers are increasing margins and changing trading conditions for JPY crosses ahead of the Japanese general elections happening on 22 October, easyMarkets and its clients’ trading conditions will remain unaffected.

“We are happy to announce that easyMarkets will be conducting its business as usual and not changing our trading conditions whatsoever. We would like to ensure our customers that we are dedicated to client safety – proven by our handling of events such as the US elections last November, the Brexit referendum in June 2016 and the Swiss Franc collapse at the beginning of 2015.”

James Trescothick, Senior Global Strategist, easyMarkets

 

easyMarkets clients will have the exact trading conditions they had when they began with the company, regardless of what is affecting markets. As such, they will be able to continue trading any JPY crosses without any hindrance.

The confirmation comes as part of a raft of easyMarkets Risk Management tools and conditions. These include:

  • Guaranteed stop loss
  • Guaranteed take profit
  • No requotes or amendments
  • Negative balance protection
  • Fixed spreads – always

In addition, the easyMarkets team is available to assess and help traders with any concerns or inquiries they may have.

 

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

Risk Warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you fully understand the risks involved and do not invest money you cannot afford to lose. Please refer to our full risk disclaimer. Easy Forex Trading Ltd (CySEC – License Number 079/07).

 

About easyMarkets

easyMarkets is a trading name of Easy Forex Trading Limited, registration number: HE203997. This website is operated by Easy Forex Trading Limited

By using easymarkets.com you agree to our use of cookies to enhance your experience.

Restricted Regions: easyMarkets Group of Companies does not provide services for residents of certain regions, such as the United States of America, Israel, Iran, Syria, Afghanistan, Myanmar, North Korea, Somalia, Yemen, Iraq ,Sudan, South Sudan, British Columbia, Ontario and Manitoba.

 

First deadlock, then hope – the Brexit negotiation saga continues

First deadlock, then hope – the Brexit negotiation saga continues

United Kingdom
  • Brexit repeatedly shocking exchange rates (easyMarkets)
  • Leaked document signals hope for UK trade deal
  • Sterling bulls quick to rejoice at the hint of good news

 

Just like life, the currency market is a roller coaster. Take what happened on 12 October with the Brexit talks. First in the afternoon we had doom and gloom and then a few hours later we had hope.

In all divorces, one of the key areas that most lawyers will lock horns over is money. And the Brexit negotiations are proving to be no different. Michel Barnier, the EU’s chief negotiator, said that there was a “deadlock” over the UK’s so-called divorce settlement. He also said that the lack of progress on this matter was “disturbing”.

The UK was hoping that it would make some headway and at least agree to start talks on a future trade deal before the crucial EU summit on 19-20 October. However, this has yet to happen. In fact, Mr Barnier has said that he felt he was not in the position to recommend to the European Council to start discussions on the “future relationship.”

“With March 2019 fast approaching the lack of progress and the increased chances of the UK getting no deal sent shivers down the spines of sterling bulls with GBP crashing against both the USD and the Euro. The GBP/USD had fallen down to the 1.31310 levels and the EUR/GBP had risen to around 0.90184.”

James Trescothick, Senior Global Strategist, easyMarkets

 

Meanwhile, a leaked internal draft document hinted that the 27 European Union countries should prepare to discuss trade amongst themselves, which will pave the way to start negotiating trade talks with the UK Government in December. The paper underlined Mr Barnier’s earlier comments about a lack of progress, but also mentioned there had been developments on some key areas, which would please many.

Though this draft can at any stage be revised, it does show a tiny a bit of hope that a deal could be made before the UK’s official exit.

The market reacted swiftly to the news.

“Sterling bulls rejoiced. GBP/USD skyrocketed back above 1.32 reversing its previous losses of the day and at the time of writing is currently trading around 1.3264. The EUR/GBP did the opposite and crashed back down, falling below 0.9000 levels to trade around 0.8925. What a difference a few hours make!”

James Trescothick, Senior Global Strategist, easyMarkets

 

When Theresa May announced that Britain would honour its financial commitments to the EU, there was the belief that the fifth round of talks would finally bring some much needed clarity that a deal could indeed be made in time. Initially it looked like that the EU and UK were getting nowhere, but this leak has shown there could be a bit of light at the end of the tunnel.

We are still very much in unknown territory, but one thing that is mostly likely certain is that we will continue to get ups and downs with the Brexit roller-coaster.

James Trescothick, Senior Global Strategist, easyMarkets

 

 

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

About easyMarkets

easyMarkets® is an online pioneer market maker established in 2001. We’ve made trading markets as easy as possible with proprietary mobile, web and desktop platforms. Traders enjoy full markets access with a simple and powerful approach to CFD’s, forex and options trading.

easyMarkets® is part of an international network with offices in Europe, Asia and Australia.

 

Risk warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

 

 

What does Merkel’s hollow victory mean for the EU?

What does Merkel’s hollow victory mean for the EU?

France Germany Italy Uncategorized
  • Angela Merkel’s fourth term win was not the victory the market was hoping for
  • 13% of voters backed the anti-Euro AFD (Alternative for Germany)
  • Euro trading at 30-day low as a result

Following the twists and turns of 2016, this year started with much apprehension that the populous vote, which saw the surprise Brexit result and Trump’s ascension to the White House, would continue and spread throughout Europe.

First there was the Dutch election, with the controversial anti-EU candidate Geert Wilders at one point fancied to be the winner. As election day got nearer, his popularity amongst the voters vanished and he eventually lost. Big sigh of relief.

Then there was the French general election. Enter Marine Le Pen, another anti-EU politician with very strong right wing beliefs, who promised to call France’s very own referendum on EU membership if she won. She didn’t. Instead, Emmanuel Macron become President and the fear that the plague of populism would spread diminished. The Euro vs the USD skyrocketed on confidence that the EU will live on.

Combined with Mario Draghi’s more hawkish tone in his ECB press conferences, where he dropped hints that the end of the central bank’s net asset purchases may happen sooner rather than later, EUR/USD soared to the highest levels since January 2015.

Of course there was the German election on the horizon but good old Angela would have no problem with that. Right?

angela-2689111_1920

On Monday 25 September the market woke up to an Angela Merkel victory, but not the victory she and the market was hoping for.  Mrs Merkel had won a fourth term, however it was her party’s worst result in almost 70 years and she now needs to form a coalition. Not only that but more worrying rival party the AFD (Alternative for Germany), which is very anti-immigration and Islam and indeed the Euro, won 13% of the vote. It’s the first far right party to win a seat in Parliament in more than 40 years.

“Mrs Merkel now has to form a coalition, which won’t be an easy task. Germany could face months of negotiations as one is formed. Whoever is chosen to partner with Merkel will provide the political direction not only for Germany but also the EU and immigration.

“At the same time, Angela Merkel’s weaker positon will also make new efforts to work with French President Emmanuel Macron on Euro-area integration very difficult.”

James Trescothick, Senior Global Strategist, easyMarkets

 

As news spread of a disappointing victory, the EUR/USD opened with a gap lower, dropping from Fridays closing price of 1.19473 to 1.19143.  It continued to decline in both the European and North America sessions and as of the time of writing is trading at a 30 day low of 1.18145.  The EUR/GBP came under further pressure and as time of writing is currently trading around 0.87618.

After concerns of the Dutch and French elections vanished there was hope that political stability in the bloc was pretty secure and the surprises that were experienced and shocked the market in 2016 had gone, but Sunday’s election outcome has once again filled the air with uncertainty.

“This sudden turn in AFD winning as much as 13% of vote (bearing in mind the party itself only came into existence five years ago) shows that there is a swathe of voters upset with Merkel’s stance on immigration. It underlines that one of the great dangers to the European Union is indeed politics and general elections. In the current climate they have become incredibly unpredictable and dangerous to its actual existence.  AFD’s success in the election goes to show that the fear of immigration is still being used as a key tool in the black art of politics to cause upset and surprise.”

James Trescothick, Senior Global Strategist, easyMarkets

 

Italy’s general election is due by the end of May 2018. There are concerns that Northern League and the Five Star Movement – both Eurosceptic parties – could fare quite well.  The Five Star movement is gaining momentum in the opinion polls and the Northern League recently won local elections in Genoa and L’Aquila.

Italy’s economy the third biggest in the Eurozone is shaky at best with 11% unemployment and national debt at 133% of GDP. There is also a fascinating debate in Italy about the country stepping away from the Euro and introducing a parallel currency alongside it.

“Though the end of May seems a long way away, you may certainly expect the market to start to focus on this general election. With what happened in Germany at the weekend, you may expect bouts of uncertainty about the outcome and how it will affect the European Union.

“The feel good factor that was felt across the bloc after Emmanuel Macron’s election victory seems to have diminished. Though the Euro is still currently enjoying a bull run, which started following Macron’s win in France, the fear and concern which the market felt at the beginning of the year could start to return as we see out 2017 and prepare for what 2018 will throw at us.”

James Trescothick, Senior Global Strategist, easyMarkets

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

About easyMarkets

easyMarkets® is an online pioneer market maker established in 2001. We’ve made trading markets as easy as possible with proprietary mobile, web and desktop platforms. Traders enjoy full markets access with a simple and powerful approach to CFD’s, forex and options trading.

easyMarkets® is part of an international network with offices in Europe, Asia and Australia.

 

Risk warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

 

easyMarkets promotes Daniel Byrne to Managing Director, APAC

easyMarkets promotes Daniel Byrne to Managing Director, APAC

Australian United Kingdom
  • Byrne to replace outgoing MD Robert Francis
  • He joined easyMarkets as COO in May
  • easyMarkets CEO Nikos Antoniades praises Byrne’s “exceptional drive and talent”

easyMarkets, the premium-service global markets brokerage, today announced the appointment of Daniel Byrne to the role of Managing Director, APAC. Previously Chief Operating Officer of Asia Pacific, Daniel replaces Robert Francis, who is stepping aside after 10 years in the role of MD and will remain with easyMarkets in an emeritus advisory capacity to the board.

Since joining easyMarkets as Chief Operating Officer in May, Daniel has pioneered the company’s Active Traders Group, which brings institutional training, tools and best practices to retail traders. Available to easyMarkets members, the training program empowers both new and experienced traders with the tools and strategies to trade successfully.

In response to the success of this approach and growing demand from Australia’s self-managed super fund (SMSF) investors, easyMarkets has recently launched The SMSF Active Traders Group. The first of its kind in the industry, this new program equips SMSF trustees with the specific institutional-grade trading strategies, methodologies and – most importantly – the risk management framework they need to trade like a fund manager.

“I have always admired easyMarkets as a brokerage that goes so much further to support the successful trading outcomes of its clients. While never the cheapest option – the best option rarely is – easyMarkets’ emphasis on training and its premium level of service, with no hidden pricing, is unique in its ability to genuinely help clients become better traders. I am extremely honoured to take up this appointment and look forward to developing our offering throughout the region.”

Daniel Byrne, MD, easyMarkets

Daniel holds more than a decade of experience in markets trading and trading education, having previously managed premium accounts and driven global platform growth at multinational FX brokerage firms GFT Markets and AxiTrader, as well as being the Vice-President of the successful forex training firm, FXPlus Trading Academy.

“When we considered the idea of a new leader for the APAC region, we knew we wanted someone who understood the ethics and DNA of easyMarkets. It is Daniel’s versatile background and approach to trading which lead us to believe he is a perfect fit. Since being appointed as COO, he has shown exceptional drive and talent in leading the team and driving the business forward. He will therefore lead our strategic efforts to grow the Australian and the Asia Pacific market. We have every confidence in Daniel and wish him success in the exciting challenges ahead.

Nikos Antoniades, CEO, easyMarkets

Earlier this year, the firm also extended its unique dealCancellation feature – which allows traders to cancel a losing trade within one hour – to the platform’s mobile app.

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

About easyMarkets

easyMarkets® is an online pioneer market maker established in 2001. We’ve made trading markets as easy as possible with proprietary mobile, web and desktop platforms. Traders enjoy full markets access with a simple and powerful approach to CFD’s, forex and options trading.

easyMarkets® is part of an international network with offices in Europe, Asia and Australia.

 

Risk Warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

 

Divided Bank of England edging closer to raising interest rates, but unlikely to move in August

Divided Bank of England edging closer to raising interest rates, but unlikely to move in August

United Kingdom
  • Internal divisions over monetary policy at Bank of England
  • UK households should “prepare for interest rates to go higher”
  • Snap election and Brexit process likely to mean rates held rates in August

The Bank of England (BOE) appears to be at odds over how to proceed with monetary policy. This internal division was on display at the June Monetary Policy Committee (MPC) meeting when three policymakers dissented the central bank’s decision to keep interest rates at record lows.

Committee member Michael Saunders, who voted to tighten monetary policy, recently told UK households to prepare for higher interest rates.

I think households should prepare for interest rates to go higher at some point. But if rates do go up, it will be in the context of the economy doing OK and unemployment being low and probably falling.

Michael Saunders, Bank of England Monetary Policy Committee

Saunders isn’t the only one talking up an interest rate increase. Andy Haldane – another voting member of the MPC – clashed with BOE Governor Mark Carney last month by stating he was seriously considering voting for a rate hike.

Against this backdrop, traders are wondering whether the MPC will pull the trigger on a rate hike at its forthcoming meeting on 3 August. Given the 5-3 split in the June decision, it appears unlikely that the hawks will get the two swing votes they need to make it happen – at least, not yet.

At the same time, Brexit uncertainty will likely pour cold water on any attempt to tighten policy less than two months after the snap election.

The consensus appears to share this view, with only two of 80 economists polled by Reuters saying they expect a rate hike next week. In fact, these economists don’t expect the BOE to act anytime soon, as policymakers wait for wage growth to catch up with inflation. This means traders should expect the official Bank Rate to remain at its record low of 0.25% – perhaps until 2019. Based on the way they began, Brexit negotiations are expected to be a long and bumpy ride, giving policy doves all the justification they need to keep rates low.

James Trescothick, Senior Global Strategist, easyMarkets

The BOE eased monetary policy last August for the first time since the recession in response to the Brexit referendum. Although the British economy has had a resilient year, its outlook continues to be plagued by uncertainty. Official Brexit negotiations began last month.

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

Risk Warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you understand fully the risks involved and do not invest money you cannot afford to lose. Our group of companies through its subsidiaries is licensed by the Cyprus Securities & Exchange Commission (Easy Forex Trading Ltd- CySEC, License Number 079/07), which has been passported in the European Union through the MiFID Directive and in Australia by ASIC (Easy Markets Pty Ltd -AFS license No. 246566).

 

Is Bitcoin teetering on the edge of the abyss?

Is Bitcoin teetering on the edge of the abyss?

World
  • $1k invested in Bitcoin in 2010 would be worth $1m now
  • Bitcoin and Ethereum account for 68.4% of the $100 billion combined market capitalization
  • ICOs currently taking place at a rate of around 20 per month

 

Over the last 30 days the original cryptocurrency, Bitcoin, has been receiving plenty of attention. In fact, the whole of the Altcoin market has featured in many a headline over the past month.

Bitcoin, which remains the leader of the pack, was first released in 2009. It was the first decentralized digital currency.  At the time, many skeptics assumed it was merely a fad that would soon vanish.

“I bet there are many out there now swallowing their words as we watch Bitcoin hit new all-time highs. At the time of writing it’s trading at around $2,500, from $11 back in 2011. I’ve read many articles demonstrating that if you had invested $1,000 in Bitcoin back in 2010 you would now be a millionaire. In fact, this did indeed happen to one young investor by the name of Erik Finman, who did exactly that and is now sitting on a fortune of $1.9 million. However, this attitude isn’t too far removed from saying, “if only you used these winning lottery numbers last week you would be a millionaire!” Hindsight is a beautiful thing.”

James Trescothick, Senior Global Strategist, easyMarkets

 

That said, the future of the cryptocurrency market is still unknown. Could an investment in a cryptocurrency today bring the same fate as that of Eric Finman?

There are now over 800 cryptocurrencies out there, with the combined market capitalization at $100 billion. However, the majority of this is made up by just a handful of high profile Altcoins, like Bitcoin (which makes up 40.1% of the market cap) and Ethereum (28.3% of the cap).

Every month sees around 20 new Initial Coin Offerings (ICO). An ICO uses a method similar to crowdfunding to release a new cryptocurrency.  The start-up firm behind the new cryptocurrency attempts to raise capital by publishing a white paper, which explains in detail about the project it is behind. The investor receives a token in return for the money he/she has invested. Early investors are incentivised to buy cryptocoins with the hope that they will go up in value if the venture is successful.

The projects of these start-up companies can vary in many different areas, from energy to gun safety, and there has been many a success story. A project called Bancor, for example, raised $153 million within a couple of hours. ICOs are proving incredibly popular, as investors hope that their chosen new cryptocurrency will eventually rise to the dizzying heights of Bitcoin.

“As amazing as they may sound, ICOs pose many problems. First, there is the obvious possibility of the project’s failure, and this stands true for pretty much any project or investment. Second, the ICO market is unregulated, so is exposed to more danger of fraud. There have been many cases of these ventures being fraudulent and there is no safety blanket to fall back on. Finally, there is the fear that the recent boom of this market is simply a bubble getting ready to burst.”

James Trescothick, Senior Global Strategist, easyMarkets

 

bitcoin-2057405_1920

Wall Street laughed its head off when one investor said back in February that Bitcoin would rise to $25,000 within the next decade. However, with the digital currency surging 400% higher over the last year, some now concede that this prediction could become reality.

Despite the recent success of Bitcoin and Ethereum, the explosion of new cryptocurrencies onto the market and the surge in new ICOs brings to mind the dot-com bubble.

Between 1997 and 2001 there was huge investment in creating internet-based companies due to the increased usage of the internet by businesses and consumers. The bubble eventually burst in 2002, with many of these web-based companies either shutting down or losing a huge amount of capital (although those that survived the financial massacre – the likes of eBay and Amazon – did bounce back and are now trading way above their pre-crash stock price).

“With the current lust for ICOs and the recent new high on the major cryptos, I can’t help but feel we could see something similar. The fact of the matter is how many cryptocurrencies does the market actually need? And how many can it use? Clearly 800 plus is an excessive number.”

James Trescothick, Senior Global Strategist, easyMarkets

 

Extreme volatility is certainly an issue. A prime example of this happened on 21 June, when Ethereum collapsed from $317 to as low as 10 cents before bouncing back. While these kinds of flash crashes can happen in any market, the manner of how the Ethereum crash happened and the severity of the drop go to show how fragile the cryptocurrency market is and how easy a sell-off across the board could cause a crash. This really is a brand-new market place with no real safe guards in place.

It seems that the likes of Bitcoin, Ethereum and LiteCoin are here to stay, with the world looking ready to embrace this new form of currency. However, many of the cybercurrencies out there will probably not last. With recent events like fraudulent ICO claims and the amount media buzz Bitcoin is creating, it is only a matter of time until some form of regulation and control are put in place. This will limit the number of ICOs and different cryptocurrencies.

For now, they can enjoy their time in the sun and all the admiration they are getting, as only time will tell how long they will last.

For further details, visit www.easymarkets.com, email pr@easymarkets.com or call +44 203 1500 748.

 

Risk Warning: Forward Rate Agreements, Options and CFDs (OTC Trading) are leveraged products that carry a substantial risk of loss up to your invested capital and may not be suitable for everyone. Please ensure that you fully understand the risks involved and do not invest money you cannot afford to lose. Please refer to our full risk disclaimer. EF Worldwide Ltd