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Daily market commentary: Volatility in the markets is low



Daily Market analysis

ActivTrades’ Market Analysts have prepared for LeapRate their daily commentary on traditional markets for December 10, 2019. This is not a trading advice. See details below:


FOREX

The calm before the storm, is how we may characterise the relative tranquillity in FX markets. Despite a slight leaning towards risk assets, with both the pound and the euro just about edging up against more defensive currencies like the yen and the dollar. Volatility in the markets is low, with investors keeping their powder dry ahead of several risk events such as central bank meetings in the US and Europe, UK elections and the next tariff deadline on the 15th. The latter two especially, have the potential to accentuate the current risk-on stance, or reverse it. By this time next week we will have a clearer picture.

Ricardo Evangelista – Senior Analyst, ActivTrades

GOLD

The gold price is stable just above $1,460. From a technical point of view, we are clearly in a phase of very low volatility for bullion (as well as for many currencies like the EUR/USD) as it has been languishing in a tight 3% range between $1,445 and $1,480 for the last month. A break out from one of these two levels could give some directionality to bullion but we remain in a wait and see scenario in the interim. It is clear that investors are waiting for a fresh market driver. The FOMC’s meeting does not seem to be one of them with any news coming from the trade war likely to be much more relevant.

Carlo Alberto De Casa – Chief analyst, ActivTrades

OIL

After the rally of last week, the oil price slowed down yesterday to a low of $58.30, before trying to recover to the threshold of $59 per barrel. In short, investors are still cautious about whether all countries will respect the deal signed at the meeting in Vienna. Moreover, there are growing expectations for the FOMC’s meeting, even if investors are not expecting big changes in guidance. Attention will be focused on the dot plot, the chart forecasting Fed’s rates for the future, and trying to assess whether this will have any impact on the oil price. Of course, any news on the trade war and the long-awaited deal would be another market driver, while the UK’s general election should have a much smaller impact.

Carlo Alberto De Casa – Chief analyst, ActivTrades

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Daily market commentary: Volatility in the markets is low

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