Trader Appetite for Risk Buoys Equities and Metals

The September Euro is trading higher overnight driven by increased appetite for risk. Global equity markets are trading better which is leading investors to seek higher yields in more risky currencies like the Euro.

The September Euro is trading higher overnight driven by increased appetite for risk. Global equity markets are trading better which is leading investors to seek higher yields in more risky currencies like the Euro.

Demand for higher yielding assets has been putting pressure on the September Eurodollar. Since reaching a peak at 99.47 late last week, the Euro has been met with profit-takers who have decided to shift their funds out of one of the lowest yielding investment vehicles into the more risky equity markets.

Look for a higher opening in September Unleaded Gasoline. The weaker Dollar along with firmer equity markets are helping to boost the demand for higher risk assets. Yesterday the American Petroleum Institute reported that gasoline inventories had dropped 69,000 barrels last week

Increased demand from China is helping to boost September Copper overnight. The weaker Dollar and firm equity markets are also providing support as speculators bet that a recovery in the global economy will spark even more demand for this metal.

Better than expected earnings from Intel yesterday and Goldman Sachs earlier in the week are helping to fuel this current rally in the September E-mini Dow. Gains could be limited today, however, as this market has reached a key 50% retracement level at 8418.

James A. Hyerczyk has been actively involved in the futures markets since 1982. He has worked in various capacities within the futures industry from technical analyst to commodity trading advisor. Using W. D. Gann Theory as his core methodology, Mr. Hyerczyk incorporates combinations of pattern, price and time to develop his daily, weekly and monthly analysis. His firm, J.A.H. Research and Trading publishes The Forex Pattern Price Time Report... More

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