Market trend analysis for 25th of July 2011

Possible default in US

 

Hi, everyone. Let us look at some market trends that we have seen recently and try to speculate a little on what we might expect in the nearest future. You may have heard about a possible default in US. I do think it is unavoidable and is due very soon, despite the fact that US has one of the best credit ratings in the world. It simply says that the agencies that give ratings for countries are looking to the moon and the stars by trying to decide which rating this or that country should be given. These kind of institutions are worthless and their advice and analysis should be the subject of humor rather than object of serious considerations. 

Commodity currencies and Swiss Frank could be best to trade long term

 

Events in US as well as Europe (serious troubles in Greece, Italy, Spain, Ireland, Portugal and other European countries) simply show that a collapse is coming. You see that dollar has been falling when the news about possible default in US came. I am convinced that is a matter of when, not a matter of if, for both US and Europe.  I do not know which currency will be the biggest loser, but I believe if you want to trade in currencies you will probably be willing to long Swiss Franc and commodity currencies (Australian dollar, Canadian dollar and New Zealand dollar). I would concentrate on those and be careful about US dollar, Euro and British pound as well as Japanese Yen. Japanese are also in debt up to their ears and the problems that were caused by the nuclear crisis after the recent disaster in Japan will continue having bad impact for Japanese Yen. 

Day traders could be watching market reaction to news from Great Britain tomorrow

 

In the meantime, we can wait for tomorrow and see what reaction will be to news from Britain (Gross Domestic Product) at 8:30 GMT. So, if you are still day trading, this could be a possibility to use. But try to concentrate on long terms more now. 

See also:

Forex news trading

RSI

Disclaimer

Trading financial markets carries a high level of risk, and may not be suitable for all investors. All information on the blog is of educational nature and cannot be considered as advice, recommendation or signals to trade in any financial markets.