Dec 8th, 2015: Oil Hits Crisis Lows as Eyes on Fed

• This morning, markets are still absorbing the impact of oil prices hitting a seven year low, while traders await tomorrow’s FOMC meeting results.

• The US dollar continues to back off, along with the USD/JPY as markets expect limited forward guidance from the Fed tomorrow.

• In contrast, the euro is holding firm as traders enjoy a benign dollar environment.

• By contrast, the Australian dollar is on the back foot after the release of the minutes from the latest RBA meeting.

Coming up today: 

• Coming up today, we have UK CPI and RPI at 09.30, with a small increased expected. PPI input is expected to rise to 0.9%.
• From here we get German ZEW economic sentiment, released alongside the European figures.
• From 13.30, we switch to North America for Canadian manufacturing sales and US CPI data, released alongside Empire State manufacturing data.
• BOC governor Poloz speaks at 16.45.

Trade Idea: 

• The Kiwi is ploughing its own (positive path) and while the Fed will garner all the attention tomorrow, the underlying strength of the NZD/USD is hard to ignore.

• A good way to play this is a HIGHER trade predicting that the NZD/USD will close above 0.6850 in 14 days for a potential return of 146%.

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