June 21st 2016: Markets Stable as Vote Day Looms

• This morning, financial markets are stable after yesterday’s surge in sentiment back towards the ‘remain’ vote in polling.  The US dollar index is stable after heavy selling yesterday.

• By contrast, the yen pairs are on the rise, as another indication as a return to stabilisation and risk taking.

• The euro – pound balance remains tied. Despite small gains this morning, the EUR/GBP is yet to undo yesterday’s opening gap lower.

• Coming up today we have UK public sector net borrowing at 09.30.
• Keep your eye out for the German constitutional court ruling OMT operations.
• Following this, we have German ZEW economic sentiment.
• At 14.00 we have ECB president Draghi speaks.
• Finally, Fed chair Yellen testifies at 15.00.

Trade Idea: 

• It’s all gone quiet over China. After a period of warnings and worsening economic conditions, the Asian giant has been out of the headlines.

• This has been excellent news for the likes of the Australian dollar as exports continue (albeit at a moderated pace).
• A good way to play this is a HIGHER trade predicting that the AUD/USD will close above 0.7550 in 14 days for a potential return of 162%.

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