Hi Everyone,
What you won’t read about in any of the international papers today is the politics of one of Europe’s most central countries. Poland does not have a potentially EU killing election today so when something small happens, like the CEO of the Warsaw Stock Exchange quitting his job even before taking the office, it will probably go unnoticed. So, I thought I’d bring it to the front for you. 😉
Rafal Antczak was a shoo-in for the position and was a favorite of a man called Mateusz Morawiecki. Remember that name because we’ll be talking a lot about Morawiecki in weeks to come. The man currently holds three of the biggest offices in the Polish government and has direct ties to some of the biggest banks there.
Antczak did not give any specific reasons for turning down this prime position but we can only speculate.
It reminds me a lot of the time Larry Summers declined the position to head the US Federal Reserve. You may recall, Summers was Obama’s favorite to take the office but suddenly announced his drop out due to “personal reasons” clearing the way for Janet Yellen. Since that time Larry has been one of the Fed’s harshest critics.
Power and politics are like the two ropes in a marvelous game of Double Dutch. Watching the participants showboat while avoiding the ropes can be great fun but sooner or later everyone gets tripped up. Antczak, like Summers, has declined to play. Probably a smart move. Morawiecki, who was until now holding the ropes will be stepping into the middle soon.
-Mati
Today’s Highlights
- Dutch Elections
- 4 Major Rate Decisions Coming UP
Please note: All data, figures & graphs are valid as of March 15th. All trading carries risk. Only risk capital you’re prepared to lose.
Market Overview
Investors around the world are watching the price of Oil as the main fear indicator at the moment. Yesterday, the price bounced off critical support at $47 as API reported a huge draw in inventories.
The price of Oil has been a huge market indicator since the decline from $110 barrel in 2014 caused global panic and widespread downsizing in the energy sector.
Now, the downsizing has already happened and many of the world’s oil barons have tightened their belt but the pit in the stomach of Wall Street traders still twinges when they see the black stuff falling.
The weekly EIA Crude Oil inventories are coming out today 14:30 GMT and will be watched closely by all.
Meanwhile, Gold is flirting with the $1200 an ounce level and the USDOLLAR index finds itself comfortably half way between 100 and 102. There is certainly no clear ‘risk on’ or ‘risk off’ sentiment in the markets or central themes ahead of the Fed.
All these Rates
Over the next 30 hours, we’ll get interest rate decisions from 4 major central banks. The United States seems like a foregone conclusion at this point as the markets fully expect to see the Fed raise the rate by 0.25% for the third time in more than a decade.
The Decision will take place at 18:00 GMT and will be followed 30 minutes later by a press conference with Fed Chair Yellen. Expect heavy volatility on all USD pairs at this time.
Tomorrow morning, just as most Europeans will be drinking their morning coffee, the Bank of Japan will have their show, all Yen traders should get up early tomorrow.
Tomorrow, we’ll hear from the SNB and the BoE. Further details in tomorrow’s daily.
How to Trade the Dutch Elections
A few weeks ago, this was looking like a clear win for the anti-EU candidate Geert Wilders. Today, things are looking a lot more complicated.
There are 150 seats in the Dutch Parliament. In order to secure the top spot, the next Prime Minister will need to hold a majority coalition of 76 seats.
Out of 28 parties involved, polls are indicating that the 150 will be splintered quite evenly between the 6 biggest parties.
Geert Wilders’ PVV party could very well gain the most seats BUT none of the other major parties are interested in forming a coalition with him. So unless we see a surprise Europe can feel confident that they won’t have a hostile government in the Netherlands.
If the seats are in fact splintered it could take weeks, or even months, of negotiations before we see a new government.
As we know, polls are not always accurate. Especially in an election like this one. So the results will be watched closely.
The early polls will be available at 20:00 GMT, shortly after the vote is closed. These polls are usually quite accurate and should give us a good indication of the final result. By 22:00 GMT the final layout should be pretty clear.
The main trading opportunity will only happen if Wilders shows a strong hand in the initial or final results. The market is not expecting this, so if it does happen, we should see a very strong shift in the EURUSD.
Trade with others. Join eToro community and use experience of other traders!
There is an amazing discussion going on right now on the wall of Louis Cornelis, an excellent trader leader in the eToro network. Feel free to ask questions, state your opinion, or just watch the chaos, on his wall @ItradeSoWhat
Have an amazing day ahead!
Best regards,
Mati Greenspan
Senior Market Analyst
