First off, I am glad that the global pandemic didn’t quite happen. It was a near thing. I have to admit, I was really worried about it. I had to fly out from one of the New York Airports last weekend. I was suffering from a bout of Hay Fever…which means I was sniffing a little…and sneezing…and my eyes watered. End result: Nervous stares in my direction everytime any of those happened. Consequently, I worked extremely hard to avoid showing any symptoms. I also overdosed on a homeopathic drug I had purchased to supplement my one-a-day Claritin. That provided some relief…along with other side effects that I won’t discuss here.
The markets are also quite happy that Swine Flu has not evolved into anything as bad as some thought it would. It’s done some damage, and the danger is by no means over yet; but things are better. At least it’s one less thing to worry about in a recession.
In Forex Trading, The dollar did well against the Euro today, along with the Canadian dollar. Not so great against the Pound, but there was a subsequent pullback. There has been a lot of optimism lately. Oil has been picking up as well. Some have said that Oil will need to rise substantially, and hold those gains, for us to feel like we are out of the woods. All of this will be bad for the dollar. However, all of this is still a little premature.
We are seeing a little bit of a pause in optimism…at least until the news is out, or in. We have a European Central Bank rate decision. If rates are cut, the Euro will most likely lose value. Also, more job figures out of the US are expected. There will be large losses, as consistent with all we have seen this year. However, if the figures are worst than expected (bearing in mind that we are all getting a bit optimistic, and therefore have better expectations…a potentially dangerous thing today), then we can expect more negative sentiment. This will be good for the dollar.
One more thing that could cause problems: The results of Obama’s Stress Tests on the Banks. If more banks need more money, then that will be bad. It will undermine some of the progress that people think we have made. And yeah, it will be good for the dollar.
So, the dollar and yen remain the primary beneficiaries of strife and unhappiness. You know that friend you have that just ruins the mood when everyone is having a good time…well, that’s the Dollar.