Tweet

Forex Market Outlook 11/3/11

Guest post by: Michael Conlon

Article Overview: An analysis and outlook into today's Forex Market for November 3, 2011. Find out what hurdles are ahead in the G-20 meetings.

Forex Market Outlook 11/3/11

Once again all eyes are on Greece this morning as we are running the gamut of Greek theater. First we saw the drama unfold during the painstaking debt crisis resolution and now we’re watching the comedy of errors that is taking place with misstep after misstep. Will we eventually see the tragedy? And whom would it end up being tragic for: the Euro zone or Greece itself.

The G-20 meeting now taking place has essentially been hijacked by the recent events taking place in Greece and now a series of additional hurdles must be navigated in order for the Euro zone to survive in its current form. The first hurdle is tomorrow’s confidence vote which may end up seeing the current regime ousted, including the Prime minister Papandreou. This could prove disastrous as they scramble to form a new coalition and to determine who is actually in charge. Rumors and false headlines are now hitting the wires saying everything from Papandreou resigning to the referendum may be canceled.

This brings us to the second hurdle, should they survive the confidence vote tomorrow, which is the idea of the referendum on the bailout. While Greece may have been intending for this vote to decide on just the bailout, EU leaders have now made it perfectly clear that this referendum would be over whether or not Greece wants to remain in the Euro zone. All aid money that Greece was supposed to receive is now being withheld until this vote.

So there is a much greater possibility that Greece will not be a member of the euro zone by year- end. Who this hurts more remains to be seen. The problem of contagion though is starting to rear its head again as yields in Italy are increasing as they rush to cut deficits.

This all comes ahead of this morning’s ECB rate decision, the first under new chief Draghi from Italy. There is some speculation that he could issue some sort of statement to the effect that the ECB will be the lender of last resort for the EU or that he could even go so far as to reduce interest rates. As I mentioned yesterday, there is a distinct possibility he could do the latter.

**Edit for breaking news** Draghi cuts interest rates by 25bp!

However, yesterday’s FOMC statement was quite different with Bernanke lowering the Fed’s economic forecast yet again as they have been miserably behind the curve. Later in the day in his speech, he said that QE3 was a potential option which gave the market hope of the free-money trade being able to continue. Europe has continued to run with this theme as US dollar weakness is driving the forex markets this morning, despite all of the risk emanating for the Euro zone.

On the data front, there isn’t a whole heck of a lot going on, with the US initial jobless claims expected to show another 400K unemployed. Later this morning ISM Non-Manufacturing figures are due to be released. Tomorrow’s NFP report is the big one to watch.

Last night, New Zealand’s unemployment rate ticked higher to 6.6% from an expected 6.4% showing signs that economy is potentially cooling.

Other than these reports, the focus of the markets will be on what happens in Greece and how the Euro zone and the world reacts. Pressure on the Greek PM to withdraw the referendum has to be immense and whether or not he is even in power next week remains a mystery.

In the meantime, the anonymous rumors will dominate the internet so take them with a grain of salt. This could produce very choppy market action over the course of the next few days, which is a short-term trader’s dream, but a long-term investor’s nightmare.

So remember to take what the market gives you and to cut losses quickly and move on to the next opportunity. With uncertain markets conditions, one small error could turn into a huge mistake in not dealt with swiftly!

By Mike Conlon

Related Articles
  Take a look at your Forex Broker
  Work at Home Business Entrepreneur: Forex Trading Made Simple
  The FOREX and the Recession
  Use Forex Trading to Provide a Hedge for the Demise of the USD
  How start trading FX in 3 steps
  Best Automated FX Trading System
  Top Forex Trading System
  Mentoring, An Essential Part Of Forex Success
  Forex Trading and You?
  How to earn 1 million dollars using currency trading
  From the Desk of James Dicks
  Double Your Money Every Year With A Managed Forex Account
  How to choose MQL4 Live trading result for automated Forex Trading
  Diversification is the Key
  5 Things you need to know before start online forex trading
  Practice Effective Money Management in FX Trading
  Leverage And Forex Trading
  Forex Trading - Trader Psychology
  How to trade FX for a living
  BlackBerry and Outlook Tips

Article Tags: Currency Market, Currency Trading, Forex, Forex Market, FX



Related Forum Posts
Re: Hi - Welcome to the Forum. Join in on the group discussions. Not sure there is much on Forex. Do you trade Forex daily and make a living on it? Maybe you can write up a review of your day to day to give us a glimpse of a Forex Traders lifestyle.
Re: Internet Users Hbk http://www.internetscamsanonymous.com - As to your Binary Options question, certainly looks interesting. However, at a glance on the subject, I note that the broker fees can range up 15-20% of the trade, while Forex, the fee is gained from the spread. Forex operates 24 hours per day for 5.5-6.5 days per week, and is the largest market in the world don't remember which it is. Again at a glance, Forex may offer more controls over your buy sell options. It appears the you can still employ some hedging schemes with Binary, while some Forex brokers have stopped that capability. Many Forex brokers are moving off shore to help keep the spirit of the trading floor open, which make it more risky for you, but give you more room to trade as you wish. I see some of the same type of promises made here with Binary and I pointed out for Forex. Picking a broker is very important. I didn't not any demo accounts for binary trades. Best to you, I will still with Forex for now. Take advantage of all the free information that you can find on the internet
Outlook Business Contact Manager - I've just installed the new Outlook 2007 with Business Contact Manager and am testing it out to see how good of a CRM system it is. I like the concept because it works right within your Outlook and I already have all my contacts and emails here. Does anybody have any experience with Business Contact Manager for Outlook?
Managing emails - From the promo page it looks like they can handle up to 16 emails. What are the benefits of using this over other email checking software? I have 6 accounts that I check regularly and use Outlook while at the office and either my web hosting webmail or gmail when I'm away. Does this program save you time over using Outlook?
Backing up data on Outlook - Hi Jen At the moment, I have 1 email account on Rogers Yahoo for personal use and 3 different emails for business (i.e. 2 on MS Outlook and 1 with Yahoo). However, I don't backup anything as I've never really had any problems yet. Can I ask what was the ineffective method used when trying to backup your Outlook data?


Share this article with your friends. Fund someone's dream.

Leave a comment below or share on the left and you'll help support entrepreneurs in Africa through our partnership with Kiva. Over $50,000 raised and counting - Please keep sharing! Learn more.

Newsletter

Get advice & tips from famous business
owners, new articles by entrepreneur
experts, my latest website updates, &
special sneak peaks at what's to come!

Name:
Email:

Popular Articles

Adapting to Technology and the Internet

3 Competencies of Leadership

Do You Have An Entrepreneurial Vision?

Suggestions

Email us your ideas on how to make our
website more valuable! Thank you Sharon
from Toronto Salsa Lessons / Classes for
your suggestions to make the newsletter
look like the website and profile younger
entrepreneurs like Jennifer Lopez.