DislikedWe have 3 factors right now:
1) Japan
2) Eurozone: Portugal bailout, Spain Banks, EFSF Bonds
3) US Economy Growth outlook.Ignored
2) Looks like Merkel has been busy again this weekend and changed the terms and conditions of the Euro bailout fund whereby the fund can now purchase EZ bonds as per this article - http://www.bloomberg.com/news/2011-0...greek-aid.html. This should have a positive effect on the Euro in the short-term.
3) The US economy as we all know is in bad shape. As cloggie states 'It is a fight between two ugly sisters' (US and EZ). US QE policies is shoring up trouble for them in the future, but you also have to ask how the EZ has created this Euro bailout fund. Basically it boils down to QE via the backdoor. The US will recover as will the EZ, but it will take many years to do so.
4) Don't forget the unrest in the Middle East, especially with the current situation in Libya. The Arab League have agreed to the UN 'No Fly Zone'. It seems that Gadaffi didn't make many friends in the Arab world during his tenure. It is a very difficult political situation, but their backing suggest that the 'No Fly Zone' will most likely be instated, but how far will the UN go to enforce it.
Current events around the world are many and happening so fast when the world's economies are in such a fragile state, which will make the markets volatile. Just look at the VIX.
I trade of the higher timeframes so I have a lot more interest in the fundamentals and looking at the bigger picture because ultimately it is what drives currencies on the longer timeframes, although in the end it boils down to demand and supply. Red and many other traders on this thread (and FF) are scalpers and therefore the long-term fundamentals doesn't affect their day trading, I still think having an understanding of the bigger picture in the back of one's mind is important through the analysis of the higher timeframes (d1/w1/mn) and how the bigger fundamentals and news events affect the currencies.
Red prefers to keep this thread to supply and demand charts, so I try to keep my fundamental analysis on this thread to a minimum. We sure can have a healty discussion and debate via Skype or another thread if you like. My Skype details are on my profile page. Add me and I will accept the invitation.
I am getting shouted out by my two little girls (2 and 4yrs old) to make their morning pancakes and then I have to get them ready for their horse riding. I have a busy day today with friends and family coming over. In the evening I will be with OTA.