Binary Options News: Euro at 1-week High on Oil: – Hot Picks 27th May 2011
Binary Options News
Market Update – Binary Options Current Affairs
The Euro advanced in the binary options market to a one-week high against Dollar on Thursday as strong commodities prices and a report that China is interested in buying “bailout bonds” for Portugal spurred active stop-loss buying of the single European currency.
The market saw sizable stop-loss Euro purchases at $1.4120 and $1.4150, encouraged by a Financial Times article quoting the chief executive of the European Financial Stability Facility as saying China was “clearly interested” in buying bonds for the Portugal bailout to be issued in mid-June.
A convincing recovery in commodities prices, in which the key U.S. crude oil futures rose above $101, also spurred active broad-based corrective buying of the euro in Asian trade.
The Euro could revisit $1.42, but lingering uncertainty over debt problems in Greece and other euro-zone countries was expected to limit strong follow-through moves.
“We’ve seen the Euro test downwards recently, but I feel there are plenty of euro-buying needs as European investors would want to repatriate funds ahead of more potential stress tests in Europe,” said Hideki Amikura, a Forex Manager at Nomura Trust and Banking.
“In addition, such demand related to bailout bond buying and lingering prospects of a possible interest rate hike by the European Central Bank could prevent the euro from falling sharply,” Amikura said.
The Euro was up 0.5 percent at $1.4162 after reaching a session peak of $1.4173, it’s the highest since May 20.
The Euro gained support the previous day after Finland approved an EU/IMF bailout for Portugal, while demand from hedge funds also prompted a squeeze in euro short positions.
The Euro was refreshed by finding support at a series of technical points below $1.4000, including the 100-day moving average, now at $1.3997, and another support seen near $1.3968, a two-month low struck earlier this week.
Below that point, $1.3770 was seen as important as it is a 38.2 percent Fibonacci retracement of the euro’s rise from June 2010 to May 2011.
Dealers said strong commodities prices also encouraged investors to buy the Euro.
“We really don’t know how debt problems in Greece and other euro-zone areas will be resolved, which is negative for the euro, but for now strong oil prices are helping the single currency,” said Junya Tanase, a forex strategist at J.P. Morgan Chase Bank.
“Higher crude oil prices above $100 could be negative for the dollar, while the euro could benefit,” Tanase said.
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Gold may rise after climbing to a record in New York for a third day as investors sought protection from a weakening dollar.
Dec. 3 (Bloomberg) — Gold may rise after climbing to a record in New York for a third day as investors sought protection from a weakening dollar.
The dollar fell as much as 0.6 percent against the euro on speculation the European Central Bank will announce plans to scale back emergency lending after keeping its main interest rate at a record low. Gold futures, which usually move inversely to the greenback, have added 38 percent this year as the U.S. Dollar Index has lost 8.4 percent, sparking inflation concern.
“Momentum is very positive for gold,” Eliane Tanner, an analyst at Credit Suisse Group AG in Zurich, said today by phone. “Weakness in the dollar is expected to go on until the end of the year. Gold could have a strong year-end rally.”
