Wednesday, 27 December 2017

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Volatile crypto

The US investment bank, Goldman Sachs Group Inc., is preparing a trading desk to become a market maker for cryptocurrencies trading, according to sources.
Such an action would not be a big surprise, given the comments coming from the bank and related to cryptocurrencies, over the past few months.
According to the same sources, GS aims to enter the business with a bitcoin by the end of June next year.
Meanwhile, cryptocurrencies prices continue with their incredible volatility. The bitcoin lost nearly 15 percent of its value last week, the bitcoin cache also hit serious losses after it added 40 percent to its value and reached levels over $3,700 for a coin.
To a new historic record rose and the ripple, which overtook the psychological limit of $1, reaching levels of about $ 1.10.
With about 10%, the price of the lightcoin has fallen. It traded before Christmas at levels of about 280 dollars per coin. Pressure on the cryptocurrency appeared after the news that the lightcoin founder had sold all his coins.

Tuesday, 26 December 2017

The Japanese central bank kept interest rates unchanged

The Japanese central bank kept interest rates unchanged. Members of the Monetary Policy Committee voted 8 to one for this decision.
The central bank also said the economy is growing moderately. And while the inflation rate remains below the Bank's targets, there has been substantial progress in price growth. Central bankers are of the opinion that this trend in inflation will remain.
The central bank's inflation target is at a 2% unreachable level at this stage.
The Japanese economy is growing moderately, the financial institution said in a press release at the end of a two-day meeting at which interest rates were kept at a negative value of minus 0.1%.
Consumer price growth stood at 0.8% in October on an annual basis, following an increase of 0.7% in September. The world's third largest economy is expected to grow 2.5% in the three months to September on an annual basis.
The decision of the Japanese bank did not surprise the market. The dollar continued to trade without any significant change over the Japanese yen after the decision at levels of about 113.42 yen per dollar.

Merry Christmas!

May this Christmas be bright, blessed and full of love.
I wish you peace, health, wealth and joy.

Have great holidays!

Wednesday, 20 December 2017

Will the Australian Dollar fall below $0.70?

Two of Australia's largest asset managers are arguing about whether the Australian currency will break the psychological limit of 70 US cents.
The Australian dollar will fall below this level by the middle of next year if Australian government bond interest rates fall below the US bond yields, according to analysts from QIC Ltd., managig assets worth $63 billion.
On the other hand, according to analysts from AMP Capital Investors Ltd., managing assets worth $137 billion, the Australian dollar will hold above the 70-cent psychological limit due to the strong growth of the Chinese economy, Australia's main trading partner.
The Australian dollar declined by about 6 per cent on its highest value in September after the two-year Australian bond premium fell for the past month against the US for the first time since 2000.
In addition, mixed economic data in the country is expected to cause the Australian central bank to refrain from raising interest rates, which are currently at a record low of 1.5%.
For the last time, the Australian dollar traded below 70 cents to the US in February of 2016.

Fluctuating dollar following the announcement of the tax cuts in the US

The dollar appreciated against most currencies on Tuesday, thanks to optimistic data from US building permits, but profits were limited by doubts about the overall impact of the country's main tax revision plan. The Republican Chamber of Deputies approved a large-scale tax bill on Tuesday, then the bill passed through the Senate and was approved. The majority in the US Senate is Republican, and this has made it easier to accept the project.
Green money rose against the yen, and against the euro depreciated after parliament approved the bill.
At the beginning of the session, the dollar appreciated as US housing data reported a 13-month high in November, while data on single-family houses struck a 10-year high. At the end of the session, green money was 0.28% higher against the yen to 112.85 yen. The euro grew slightly against the euro, with the single currency closing the session at 1.18399, which is 0.51% higher than on Monday.

Tuesday, 19 December 2017

Oil - where in 2018?

Brent's price is expected to be at an average of $60 a barrel next year and US crude oil at $55 a barrel. At least according to the analysts' average expectations.
Experts predict a drop in oil prices. By comparison, the Brent is currently traded at about $64 a barrel, and US crude oil is close to $58 a barrel.
A major engine in the price of oil in the coming year is expected to continue to be the US industry and more specifically the direction of the key manufacturers.
The production constraints, which came in the direction of OPEC and Russia, largely predetermined the appreciation of oil on international commodity markets. However, it is quite possible to change the following year.
Net short positions rose for the ninth consecutive week and reached record levels. That is, most of the major oil operators are likely to insure their future production against a potential oil price depression.
Much of the US oil producer has futures contracts for the end of the third quarter last year at an average price of $48.95 a barrel.
Of course, there is a danger of further rising oil prices, given the record short positions in futures, warn some market observers.
The US Energy Ministry predicts a production increase of up to 10 million barrels per day next year, which would be record in US manufacturing history. If this figure is reached, it is entirely possible for the price of "black gold" to be logically put to serious testing.

Monday, 18 December 2017

JPM: The S&P 500 targets 3,000 in 2018

Tax reforms will continue to support the growth of US markets. This is the opinion of financial experts from the US financial institution JPM.
The US bank analyst team expects the US indices to perform well. For this, Trump's tax reform may help, which, is extremely close to acceptance.
Stable growth, weak monetary policy, low interest rates and taxes will be among the factors that will lead to a rise in US indices next year. The goal of the broad US S&P 500 is expected to reach the psychological limit of 3,000 points in the next year.
Of course, there are analysts who are not as positive about the future of the indices. According to some, next year, though good for investors in general, may be related to risks.

US indices ended in new records

US indices reached new historical records, awaiting the introduction of tax reform next week.
The S&P 500 indice, the Dow Jones Industrial Average and the Nasdaq 100 Stock Index closed at historic records after it became clear that the final tax reforms will be presented late Friday, and a vote for their approval is expected next week.
Russell 2000 Index's Index for Small Businesses saw the ninth consecutive growth for the last 10 sessions, precisely following the expected reforms.
Still, there are some uncertainties about the final version of the tax reforms and whether they will not undergo any changes.
The S&P 500 rose 0.9 percent to a level of 2,675.63 points or the highest closing level in its history. The Nasdaq 100 added 1.2% and Nasdaq Composite added 1.2% to its value.

Wednesday, 13 December 2017

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Tuesday, 12 December 2017

Jamie Dimon: I'm open to cryptocurrencies... But regulated!

The bitcoin is everywhere in the news and in the media. Apparently this puts a serious strain on Jamie Dimon, who, apart from being terribly wrong in his forecast for the bitcoin (at least for now, claiming it is a balloon that will end up much worse than tulip mania) when it was 6000 dollars, said he would have fired each of his company, which traded with cryptocurrencies.
Goldman Sachs, which are expected to be one of the major market makers of the bitcoin and other cryptocurrencies, have benefited from this.
Dimon, said he was still skeptical about his bitcoin and its future, but he had definitely softened his tone.
Dimon's last comments are definitely far more different than before. About a month ago, he said that if you're stupid enough to buy it, you'll pay the price for it one day, when the price of the cryptocurrenciy was about $5,800.
Since then, the bitcoin has risen to more than $19,000, last trading at just over $15,000.
Although Dimon said in September that the bitcoin was a scam, he did not even deny that the cryptocurrency could safely rise to $100,000 before it reached its peak.

The Brent with the highest price since 2015

Brent has risen to its highest levels since 2015 today, after an unplanned closure to repair a North Sea pipeline. This has resulted in serious supply difficulties and has helped to raise the cost of raw material.
The Brent with delivery in the next month traded at $64.73 a barrel early this morning.
Raw material has begun to rise before the meeting of OPEC, which reached agreement to extend production constraints by the end of next year. The decision was also backed by Russia.
However, this time, unlike the previous one, OPEC's decision did not lead to a sharp depreciation of the price of "black gold."
More and more analysts are starting to talk about a price of 70 or even $80 a barrel next year. The good performance of the global economy and the possible depreciation of the dollar may be the factors that will predict similar high prices.
Brent peaked yesterday, at $64.93 a barrel, or its highest price since June 2015.
US crude oil was traded at $57.98 a barrel.

Monday, 11 December 2017

Credit Suisse: It's time to buy technology companies

News related to US tax reform has led to a serious downsizing of technology companies. And according to Jonathan Golub, an analyst at Credit Suisse, the time for purchases may have occurred.
Information becomes more and more about tax cuts, and investors now have more clarity. This led the US indices to new records, with investors shifting from technology to industrial and financial companies.
Last week we saw growth in consumer, financial and industrial companies and a decline in technology ones.
Technological companies generally outperformed the market this year, and will probably continue to do so next year, says Goleb.
Golub also pointed out that technology companies are traded at a slightly higher ratio than other companies. The cost-benefit ratio for technology companies is 19.8, while the S&P 500's is currently 18.2.

Gold with its biggest weekly decline since May

Gold prices stabilized on Friday, but recorded its biggest weekly decline since May, after better-than-expected US employment data. The data strengthened investors' expectations that we will see an increase in interest rates in December.
This, in turn, has led to an appreciation of the dollar, to which the price of gold is very sensitive.
Over the past week, gold has overcome the lower limit of the range that has been trading since July. This helps to increase the decrease of the metal.
The spot price of gold ended late last week with a minimum increase of 0.1% to 1 247.50 dollars per ounce. This was close to the lowest value of $1 243.71 per ounce, or its lowest level since July 26. The metal lost 2.5% of its value this week, which was the third consecutive price depreciation.

Thursday, 7 December 2017

What can happen if Trump is removed (2)?

An initial reaction in such a scenario would be the suspension of the so-called Trump Rally, which has taken the US indices to new historical records, according to Peter Kenny, chief strategist at the Global Markets Advisory Group. The expert commented that the investors really felt comfortable about what to expect from Trump as president.
Fundamentally, the US economy remains in good shape in an environment of low inflation and steady growth. Meanwhile, Trump's nomination for Jerome Powell's fed leader has won the admiration of market players.
It is possible, after the initial shock to the market, with a potential removal of Trump, that markets quickly find support, Kenny said. Pens, is likely to continue with Trump's planned tax policies, as well as the nominated Powell.
Or, according to a number of experts, such political uncertainty can be short-lived and quickly overcome. And if you follow Buffett's advice - to buy when everyone is afraid, a deeper adjustment of the indices, could provide good opportunities for investors to enter the market.

Wednesday, 6 December 2017

What can happen if Trump is removed (1)?

Financial markets have experienced a difficult Friday last week. The leading US indices dropped momentarily after it became clear that Michael Flynn admitted he had lied in the testimony given to the FBI and could provide new evidence of inappropriate relations between President Trump and Russia.
What could happen?
The chances for President Trump to step down from his post are rising. This could be the worst scenario for investors because it would lead to serious political uncertainty at a time when stock prices rose seriously in anticipation of Trump's tax reform. The latter, however, is delayed and there are serious chances not to become a reality since the beginning of next year, as were the real expectations of investors.
There is a real opportunity for Washington to turn to its biggest crisis since the Watergate scandal in the early 1970s. At the same time, when Trump is removed, he is expected to be replaced by current Vice President Mike Pens, who would become premature the 46th US president.
And while this still seems like a fairly unlikely scenario, more and more investors are beginning to wonder, what would President Pens mean for the US stock markets?

Tuesday, 5 December 2017

Oil with a slight increase in expectations of US stocks report

Oil prices rose slightly today due to expectations of a decline in oil stocks in the United States and after the OPEC deal last week to extend production constraints.
The Brent with delivery next month added nearly one percent to its value, to a level of $63 a barrel.
US crude oil is traded in the morning at $57.40 a barrel or with no significant change from yesterday's levels.
Last week, OPEC countries agreed to continue their production restrictions at 1.8 million barrels by the end of next year. This, however, was not followed by much reaction to the price of oil.
According to Goldman Sachs analysts, Saudi Arabia and Russia have shown a strong will to continue the production constraints by lowering their forecasts for the price of Brent and US crude oil to 62 and 57.5 dollars respectively.

Monday, 4 December 2017

GS: The bitcoin is a raw material

The bitcoin is more like gold than the US dollar, according to Jeff Curry, head of the Goldman Sachs State Investment Bank unit, in a special interview for Bloomberg TV.
The bitcoin does not have the same amount of liquidity as gold, which is the main difference with the metal.
According to Curry, the price of the bitcoin is determined by the market and is not supported by a government, public or private company, just like gold.
Of course, the bitcoin is much more volatile than gold, and Curry explains that liquidity is the main reason for that. There are $8.3 trillion amount of gold worldwide, while the market capitalization of the bitcoin is close to $165 billion, making it much less liquid and more volatile.
Curry's comments come true after the cost of the bitcoin reached levels of more than $11,000, and then fell only a day later to less than $10,000. They come at a time when Goldman Sachs chief Lloyd Blenkheim said he is still considering the possibility of a bitcoin.
The meteoric appreciation of the bitcoin raised public interest in cryptocurrency to record levels.

Demand for gold rose after the political events in the US

Political developments in the US since the end of last week have prompted investors to raise demand for "rescue assets".
The gold has taken advantage of the situation and has appreciated. The noble metal added 1% of its value to levels above $1,290 per ounce.
More and more experts are beginning to talk about testing a psychological limit of $1,300. The last level has been limiting the growth of the metal over the past few months. If level will overcome, however, we can very quickly see a further appreciation for the yellow metal to $1,350, and later to $1,400.
The rise became a fact after former Donald Trump's security advisor Michael Flynn said he was ready to testify about unlawful ties between Trump and Russia.
The report raised fears that Trump may soon not be the president of the United States, leading to serious political and economic shocks.