Forex Investment and Currency Trading

It has been a point of note that EUR/NOK has been impervious to the moves in oil prices for the past year, that is until September. Specifically, EUR/NOK did not respond to the rise in oil prices to $145/bbl and did not break out of its range to the upside until oil had fallen to around $100. This is at odds with the template laid out in 2005-2007 when EUR/NOK much more closely followed the move in oil prices – most notably demonstrated pre and post Hurricane Katrina. Instead $/NOK has been much more closely correlated with the oil price, [...]

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The AUD has fallen for ‘good’ reasons – a fall in commodity prices and a narrowing in interest rate differentials. Both of these factors are likely to continue to weigh on the AUD as the global recession undermines commodity prices and the RBA cuts interest rates faster than most other central banks.
Support for this view is also derived from the sharp decline in bulk freight shipping rates which have fallen more than 85% from peak levels earlier this year.
That said, the AUD has fallen very sharply from the recent peak of US$0.9849 recorded in July.
As noted above, the AUD fall [...]

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AUDUSD has moved 34 big figures (35%) in three months…or the same range as the previous 5 years

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FX Bottom-Line: CAD’s commodity status is fading as the US credit crisis deepens. In its place, USD is emerging as the main driver of CAD/crosses as CAD’s North American status trumps all other considerations. This is not unchartered territory, but reflects a familiar relationship associated with US recessions. The USD roller-coaster ride is continuing and ‘clever money” is often caught wrong-footed, but as long as the US uncertainties linger CAD/crosses will take their primary direction from broadbased USD changes.
Crude oil rallied toward US$110/bl earlier this week. NOK obliged and followed oil higher to outperform its G10 peers. CAD, however, lingered [...]

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