BetOnMarkets.com Morning Report

The FTSE, DAX and CAC are down by around a quarter of a percent at the open. Asian markets were weak overnight, with losses ultimately following the evening sell off in US markets. Wall Street slumped to a six week low as traders dismiss talk of green shoots. UK PM Gordon Brown has warned of a second wave in the recession and there are rumours of second massive stimulus package being required to kick start the US economy.

Oil is a good barometer of economic sentiment and judging by the 5th consecutive session of declines in crude prices, the omens aren't good.

Today we have the UK Halifax House Price index at 08.00 GMT followed by Eurozone GDP at 09.00.

Pair in play


Currency markets are quiet so far today as traders adjust to the renewed strength in the dollar seen over the last few days. The yen pairs have seen the most action so far today with AUD/JPY the biggest mover after better than expected Australian home loans data.

The biggest movement seen on a non yen pair is the USD/CAD (US Dollar/Canadian dollar) which is often influenced by the price of oil. So far the pair has moved less than the equivalent move in the price of crude and If oil keeps up the pace of declines, this relative inaction might not last.

This makes the USD/CAD today's pair in play. A Break out trade can be a good way to trade a range bound market as the range cannot last forever. One way to play this would be a Break Out trade on the USD/CAD over 2 days with the lower level set as 1.1500 and the higher level set as 1.1850.