Australian Stocks Down For 2nd Day
Australian stocks are down again today after the government reported its trade deficit widened more than expected. Imports were greater than exports by A$2.64 billion, compared with expectations for a A$2.3 billion deficit. The stronger Aussie dollar has been used by consumers to increase purchases of cheaper Chinese goods. The rebound in iron ore prices weren’t enough to offset the stronger Aussie dollar. Many economists are saying that outside the resource sector, the Australian economy is weakening and that the Reserve Bank of Australia will have to cut interest rates again in February and maybe again after that.
China’s Growth Forecast To Increase In 2013
China’s economy is expected to outperform this year and that’s a positive for Australia’s number one export – iron ore. Iron ore prices are expected to continue their advance. Prices reached a low in September of $86.70 a tonne and are now trading above $150 a tonne. Prices for coking coal, used in blast furnaces to make steel, are expected to rebound this year as well. Coking coal is another key export for Australia. Many see increased commodity prices as a necessity for the Australian government to return a surplus this year on higher tax revenues. China’s economy grew 7.7 percent last year and is expected to grown 8.1 percent in 2013.
Euro And The Yen Firmer Against The US Dollar
The euro continues to hold the key $1.30 level, which is also just above the key 50 day moving average of $1.2993. The euro was last trading at $1.3124. Analysts at Credit Suisse see the euro advancing to $1.3309 in the short term.
The Japanese yen was last trading at 87.52 to the US Dollar as some see the recent selling as overdone and the currencies Relative Strength Index (RSI) dropped to 15.5. A reading below 30 indicates that a market may be oversold and is a buy.
Japanese stocks fell 88.31 to 10,510.70. Japanese stocks are reacting to the strength in the yen. To trade Japanese binary options, all one has to do is watch the yen. When the yen strengthens, buy binary puts on Japanese stocks and when the yen weakens, buy binary calls. There is a lot of money to be made in the Japanese binary options market right now and I advise binary traders to pay close attention.
Demand For Palladium Expected To Be Strong In 2013
Many analysts see record automobile production spurring increased demand for palladium. Demand is forecast to exceed supply by 511,000 ounces in 2013. Morgan Stanley forecasts this to continue until 2017. Palladium’s highest price ever was $1,125 an ounce reached in 2001, so there’s more room for the commodity to advance. Palladium was last trading at $668.85 on the COMEX, or the New York Commodities Exchange, part of the CME Group.
Hedge funds are very bullish on prices. Binary traders should look to buy calls on palladium and use a longer time horizon. Palladium is used in the manufacture of automobiles and global car sales exceeded 80 million in 2012. Forecasts call for production to be 82.7 million in 2013. Russia is the number 1 producer of palladium and there are signs that government stockpiles are being depleted, which further makes the case for higher palladium prices.
All else is quiet in the binary options world. I’m not seeing anything that I’m excited about. As always, good luck trading and be sure to check back for the latest updates!
