Market Outlook for February 9, 2012

By Compass Global Markets on Feb 9, 2012 04:27:38 GMT

Recap of the Latest Global News By Keagan York on Feb 9, 2012 European finance ministers have convened an emergency meeting in Brussels today as the Greek government continues to struggle to finalize of terms of its next rescue package. The ministers will meet with IMF chief Christine Lagarde but no agenda has been announced. [...]

Centerra Gold Updates Reserves and Resources Total Gold Reserves 8.1 million Contained Ounces

Posted on Feb 9, 2012 10:43:00 GMT 10:43 PM | Originally posted at MarketWire

This news release contains forward-looking information that is subject to the risk factors and assumptions set out on page 14 and in our Cautionary Note Regarding Forward-looking Information on page 16. All figures are in United States dollars. Centerra

• Canada’s economic future: Slower potential growth, bigger East-West disparity
  Posted on Feb 9, 2012 10:43:00 GMT 10:43 PM | Originally posted at The Record
• Greek debt rescue hits 625 mn euro hurdle
  Posted on Feb 9, 2012 10:40:00 GMT 10:40 PM | Originally posted at Bangkok Post
• COMMODITIES-Oil, copper jump as Greece debt deal boosts risk
  Posted on Feb 9, 2012 10:26:00 GMT 10:26 PM | Originally posted at Reuters Mobile

Gold strong uptrend stalled

By Compass Global Markets on Feb 9, 2012 04:34:04 GMT

GOLD our move to a neutral stance on gold in the short term has been validated over the past week as the strong uptrend has clearly stalled. The range overnight was $1,724 to $1,751. Gold looks likely to maintain this range for the short term as investors seek further developments and clarification of the situation in Europe. Gold opens the morning at $1,732. Given our neutral short term bias we expect more of the same with gold expected to maintain recent ranges for now. It will only take some form of even minor shock, most likely emanating from Europe or the Middle East to propel the price above strong resistance at $1,750. For today, we are unlikely to initiate any trades given the high event risk associated with announcements that may come from any one of the parade of cast members involved in the Greek drama. We clean break of $1,755 will have us buy while a test of support at $1,720 will see us enter into a short term long position.

Spread Trading – Futures vs FX

Futures – In Futures Spread Trading the trader simultaneously buys (longs) and sells (shorts) futures contracts for two related commodities or securities. The rationale behind this kind of strategy is that as futures contracts approach maturity, prices of different contacts will often change differently over time, leaving savvy traders an opportunity to profit. We explain this in more detail below, but overall spread trading offers good traders the opportunity to profit off contract spreads instead of taking a position on the market’s direction.

Some traders may also pursue this kind of trade, believing they reduce their overall exposure to the market, since losses from longs will be offset from shorts and vice-versa. Futures spread trading generally is a more conservative approach to trading overall than simply investing in one futures contract.

FX – In FX, spreads traders seek to buy a currency cross in order to take advantage of rollover interest, while simultaneously shorting a similar pair to reduce their exposure to unpredictable fluctuations in price.