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Markets struggling for direction, oil slightly above multi years low

The U.S. dollar suffered its 2nd worst month so far against the Euro this year

CFDs are a leveraged product and can result in losses that exceed deposits. Trading CFDs may not be suitable for everyone, so please ensure you fully understand the risks and take care to manage your exposure.
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Equity, currency, and commodity markets all struggling to find direction amid light trading volumes with vast market participants more concerned about their plans for Christmas and New Year’s Eve. Some traders consider the tight range market an opportunity to benefit from few tips on the upside and downside using some technical indicators such as commodity channel index, Bollinger bands, stochastic, MACD and others on a short-term basis.

U.S. data can provide some guidance during the U.S. opening session with final Q3 GDP figure due to release. The reading is likely to be revised lower to 1.9% from 2.1% in November’s release.  Business inventories and exports are the components anticipated to drag the number lower on the back of soft global demand and strong US dollar. However, we are more concerned about the consumer behaviour that will play the biggest role in future fed policies, and on Wednesday will get the latest update on whether U.S. consumers purchasing more ahead of the holidays season.

The U.S. dollar suffered its 2nd worst month so far against the Euro this year. EURUSD strengthened in December at a time when monetary policy diversion occurred as the Fed hiked rates for the first time in a decade and ECB relaxed further its monetary policy. We touched on this subject couple of times and stressed that markets price in all known news before it occurs and this is why USD weakened in December. However, looking at the full year performance the US Dollar index is on track to book 10% of gains in 2015, and we look for further appreciation the year ahead.

The single currency ignore the better than expected German consumer confidence figures release earlier today. GfK’s increased by 0.1 points to 9.4 to show that consumer mood is continuing to improve and overcome refugees challenges and Paris terrorist attacks in mid-November.

Brent recovered slightly from 11 years low to trade above $36.20. With no major fundamental news before API and EIA releases on Wednesday any market move will most likely be speculative. What’s more interesting to watch is the spread between the two major benchmarks as WTI and Brent spread continues to narrow creating opportunities trade the difference between the both.

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CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.