All is quiet as the U.S. prepares for Christmas along with the rest of the Anglo world. Last week I expected the EUR/USD to close above 1.0275 and it did at 1.0494. The current spot rate at 6:11 pm EST is 1.04412. I see one NADEX contract expiring on Friday at 3:00 pm with a buy of $.98 that the EUR/USD will close above 1.0275 and another contract, also expiring on Friday with a buy of $.4650 that the contract will expire above 1.0475. I calculate a forward rate of 1.0288 for contracts closing Friday, with a ceiling at 1.0401.
Unless some catastrophic natural event occurs, I do not see a major change in either the Euro short-term rate or the one-month T-bill rate.
(Ready for your next trader challenge? Visit http://toptiertrader.com/?ref=1449)
Meanwhile, mainstream media seems to have little to report on. The Trump news on a Sunday evening is percolating around whether Elon Musk, the DOGE Master, is gunning for the presidency. Article II, Section 1 requires that the president be a natural born citizen of the United States. That requirement rules Mr. Musk out for contention.
What has the press up in arms is Mr. Musk’s supposed support for the Alternative for Germany political party. For example, Mr. Musk allegedly tweeted that only the AfD can save Germany, I guess in reference to Germany’s deteriorating economy. Mr. Musk’s support could be problematic for Mr. Trump given AfD’s classification as a suspected extremist organization and Mr. Musk’s growing ties to the presumptive president-elect.
From a 30,000-feet level, a trader’s primary concern should be whether the incoming administration can encourage the creation of markets and contracts flowing from those markets. So far, I have not detected policy positions that would scare off flows of capital from foreign investors. Mr. Musk’s increasing insertion into geopolitics should be tamped down and his focus should be, like the rest of the incoming administration, on creating and sustaining markets.
Alton Drew
22 December 2024
If you are in need of a legal or political risk assessment regarding your trading environment, reach out to me on LinkedIn or email me at altondrew@altondrew.com.
DISCLAIMER: I am not a financial adviser. These blog posts are for educational purposes only. Investing of any kind involves risk. Your investment and other financial decisions are solely your responsibility. It is imperative that you conduct your own research and seek professional advice as necessary. I am merely sharing my opinions.
AFFILIATE DISCLOSURE: Some of the links on this channel are affiliate links, meaning at no cost to you I earn a commission if you click through and make a purchase. However, I only recommend products or services that I believe in.
Lawyers Write the Bets. Bankers Sell the Bets. 