Trade Futures, Spreads and Options with Confidence.
We think that a September US rate hike is off the table because of a lack of definitive forward progression in the US jobs sector. The unending Greek saga combined with a rising Dollar has created enough headwinds to keep the Fed on the sidelines until later in the year.
The quickest and cleanest track to a major top in the Dollar was for US economic numbers to remain strong and for US economic strength to pull the Euro zone into self-propagating growth.
A number of central banks have implemented fresh easing efforts, German and European economic prospects have shown some minor improvement, and the prospect of lingering cheap energy prices is starting to offer global consumers new confidence.
The events in the second half of 2014 will do more to stimulate the global economy than all the central bank and governmental efforts combined.
While it is premature to suggest that a major bottoming of commodity prices is imminent, a combination of bearish geopolitical pressures, distinctly adverse currency market action, slack physical demand and rising physical supplies could result in a crescendo of selling and perhaps an intermediate bottoming in several markets.
It would seem like US and global equity markets have finally come to grips with the less than anticipated rate of recovery, the fear of overvaluations and a rising measure of uncertainty toward the Middle East and oil prices.
The list of positive global data flows expanded last week with improvements in UK Unemployment, China Retail Sales, and US February and March Industrial Production figures.
Make no mistake: The ebb and flow of Chinese physical commodity demand remain paramount to commodity price trends! Clearly Chinese growth has slowed, and clearly there has been an added fear of credit turmoil inside of China with their recent bond failure.
There are some pretty significant differences between the futures markets and the equities markets. The first big difference is the trading hours: the futures markets trade 23 hours a day for most markets versus an 8:30 AM (central time) open and a 3:00 PM close in the equities markets. The second difference is the ease… Read more.
When it comes to Futures Spreads, many traders ask us what is the benefit of spreading futures contracts. They want to know why we often choose to spread futures contracts instead of either being long or short a single futures contract or option, or use option spreads instead.