Ashraf Laïdi

Currency Trading and Intermarket Analysis

How to Profit from the Shifting Currents in Global Markets

• Gebundenes Buch

Produktbeschreibung

As head FX strategist at CMC Markets one of the world s leading forex/commodity brokers Ashraf Laidi understands the forces shaping today s currency market and their interplay with interest rates, equities, and commodities. And now, with Currency Trading and Intermarket Analysis, he shares his extensive experiences in this field with you. Throughout the book, Laidi outlines the tools needed to understand the macroeconomic and financial nuances of this dynamic field and provides you with insights that are essential to making the most of your time within it.

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Produktdetails

• Wiley Trading Series
• Verlag: Wiley & Sons
• Artikelnr. des Verlages: 14522623000
• 1. Auflage
• Seitenzahl: 304
• Erscheinungstermin: 1. November 2008
• Englisch
• Abmessung: 235mm x 157mm x 21mm
• Gewicht: 498g
• ISBN-13: 9780470226230
• ISBN-10: 0470226234
• Artikelnr.: 23896249

Autorenporträt

Ashraf Laidi is the head FX Strategist at CMC Markets, where he oversees the analysis and forecasting functions of G-10 currency pairs as well as decisions and trends of the major global central banks. His online FX analysis has received wide following for more than a decade, centering on G-10 currencies and economies. Prior to joining CMC, Laidi monitored the performance of a multi-FX portfolio at the United Nations, assessed sovereign and project investment risk for Hagler Bailly and the World Bank, and analyzed emerging market bonds at Reuters. He also created the first 24-hour currency Web site for traders and researchers during the inception of the Euro. He is the founder of AshrafLaidi.com.

Inhaltsangabe

Foreword xi
Preface xiii
Acknowledgments xvii
Chapter 1 Gold and the Dollar 1
End of Bretton Woods System Marks Gold's Takeoff 2
Fed Tightening and FX Interventions Rein in Gold Rally 3
Central Banks' Gold Sale Agreements 5
Gold-USD Inverse Relation 6
Recent Exceptions to the Inverse Rule 6
Using Gold to Identify Currency Leaders and Laggards 8
Gold's Secular Performance 11
Valuing Currencies via Gold 13
Golden Correlations 14
Don't Forget Falling Gold Production 16
Gold and Equities: Hard versus Monetary Assets 16
Equity-to-Gold Ratios 19
TheRoleoftheSpeculators 21
Gold Is Part of a Larger Story 22
Chapter 2 Oil Fundamentals in the Currency Market 25
From a Gold Standard to an Oil Standard (1970s-1980s) 26
Oil Glut and Price Collapse (1981-1986) 32
The Super Dollar of 1980-1984: The World's Third Oil Shock 34
World Intervenes against Strong Dollar (1985-1987) 39
Iraq's Invasion of Kuwait and the Gulf War (1990-1991) 41
The Asian Crisis and OPEC's Miscalculation (1997-1998) 44
Oil Thrives on World Growth, Dot-Com Boom (1999-2000) 46
Iraq War Fuels Oil Rally, Dollar Flounders, China Takes Over (2002 to
Present) 46
Summary 49
Chapter 3 When the Dollar Was King (1999-2001) 51
The Major Theories 52
Annual Performance Analysis of Individual Currencies 53
Summary 70
Chapter 4 The Dollar Bear Awakens (2002-2007) 71
2002: The Beginning of the Dollar Bear Market 71
2003: Dollar Extends Damage, Commodity Currencies Soar 78
2004: Global Recovery Boosts Currencies against U.S. Dollar 84
2005: Commodities Soar alongside Dollar, Carry Trades Emerge 90
2006: Dollar Vulnerable as Fed Ends Two-Year Tightening 94
2007: Record Oil Boosts Loonie, Helpless Fed Hits Greenback 102
Lessons Learned 108
Chapter 5 Risk Appetite in the Markets 111
Carry Trades in Foreign Exchange 112
Using Risk Appetite to Gauge FX Flows 121
Tying It All Together: 1999-2007 134
Chapter 6 Reading the Fed via Yield Curves, Equities, and Commodities 137
Yield Curves and the Economy 138
Types of Yield Curves 139
Rationale of Inverted Yield Curve Implications 142
Effectiveness of Yield Curve Signals' Implications 142
Greenspan's "Conundrum" Proved Bernanke's Problem 143
Implications for Growth, Stocks, and Currencies 145
Tying Interest Rates to the Gold-Oil Ratio 153
Conclusion 158
Chapter 7 U.S. Imbalances, FX Reserve Diversification, and the U.S. Dollar
161
The U.S. Twin Deficits 162
U.S. Current Account Deficit: Old Problem, New Challenges 165
Adding the Budget Balance to the mix 169
Financing the Deficits: The Path to Unsustainability? 170
Dissecting U.S.-Bound Foreign Capital Flows 172
U.S. Stocks and Bonds Vie for Foreign Money 173
Capital Flows Shift Identities 177
Foreign Direct Investment and M&As 179
How Long Will Foreign Capital Be Available on the Cheap? 181
Don't Ignore U.S. Investors' Flows Abroad 182
Currency Reserve Diversification: OPEC and the Middle East 185
Further Currency Diversification Is Inevitable 187
The View Ahead 189
Chapter 8 Commodities Supercycles and Currencies 191
The Current Commodity Cycle versus Previous Cycles 193
Dissecting Commodity Classes 196
Commodities and their Currencies 207
Developing World to Maintain Ripe Outlook for Food and Grains 208
Energy Efficiency Not Enough to Halt High Oil 214
Copper and Gold to Shine on Long-Term Fundamentals 219
Commanding Heights or Common Bubbles? 223
Chapter 9 Selected Topics in Foreign Exchange 225
Revisiting Yield Curves 225
Is Dollar Stability a Necessity? 230
How Far Will Commodities Outstrip Equities? 236
U.S. Politics and the U.S. Dollar 240
Conclusion 247
Bibliography 249
About the Author 251
Index 253

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Foreword xi

Preface xiii

Acknowledgments xvii

Chapter 1 Gold and the Dollar 1

End of Bretton Woods System Marks Gold’s Takeoff 2

Fed Tightening and FX Interventions Rein in Gold Rally 3

Central Banks’ Gold Sale Agreements 5

Gold-USD Inverse Relation 6

Recent Exceptions to the Inverse Rule 6

Using Gold to Identify Currency Leaders and Laggards 8

Gold’s Secular Performance 11

Valuing Currencies via Gold 13

Golden Correlations 14

Don’t Forget Falling Gold Production 16

Gold and Equities: Hard versus Monetary Assets 16

Equity-to-Gold Ratios 19

TheRoleoftheSpeculators 21

Gold Is Part of a Larger Story 22

Chapter 2 Oil Fundamentals in the Currency Market 25

From a Gold Standard to an Oil Standard (1970s–1980s) 26

Oil Glut and Price Collapse (1981–1986) 32

The Super Dollar of 1980–1984: The World’s Third Oil Shock 34

World Intervenes against Strong Dollar (1985–1987) 39

Iraq’s Invasion of Kuwait and the Gulf War (1990–1991) 41

The Asian Crisis and OPEC’s Miscalculation (1997–1998) 44

Oil Thrives on World Growth, Dot-Com Boom (1999–2000) 46

Iraq War Fuels Oil Rally, Dollar Flounders, China Takes Over (2002 to Present) 46

Summary 49

Chapter 3 When the Dollar Was King (1999–2001) 51

The Major Theories 52

Annual Performance Analysis of Individual Currencies 53

Summary 70

Chapter 4 The Dollar Bear Awakens (2002–2007) 71

2002: The Beginning of the Dollar Bear Market 71

2003: Dollar Extends Damage, Commodity Currencies Soar 78

2004: Global Recovery Boosts Currencies against U.S. Dollar 84

2005: Commodities Soar alongside Dollar, Carry Trades Emerge 90

2006: Dollar Vulnerable as Fed Ends Two-Year Tightening 94

2007: Record Oil Boosts Loonie, Helpless Fed Hits Greenback 102

Lessons Learned 108

Chapter 5 Risk Appetite in the Markets 111

Carry Trades in Foreign Exchange 112

Using Risk Appetite to Gauge FX Flows 121

Tying It All Together: 1999–2007 134

Chapter 6 Reading the Fed via Yield Curves, Equities, and Commodities 137

Yield Curves and the Economy 138

Types of Yield Curves 139

Rationale of Inverted Yield Curve Implications 142

Effectiveness of Yield Curve Signals’ Implications 142

Greenspan’s “Conundrum” Proved Bernanke’s Problem 143

Implications for Growth, Stocks, and Currencies 145

Tying Interest Rates to the Gold-Oil Ratio 153

Conclusion 158

Chapter 7 U.S. Imbalances, FX Reserve Diversification, and the U.S. Dollar 161

The U.S. Twin Deficits 162

U.S. Current Account Deficit: Old Problem, New Challenges 165

Adding the Budget Balance to the mix 169

Financing the Deficits: The Path to Unsustainability? 170

Dissecting U.S.-Bound Foreign Capital Flows 172

U.S. Stocks and Bonds Vie for Foreign Money 173

Capital Flows Shift Identities 177

Foreign Direct Investment and M&As 179

How Long Will Foreign Capital Be Available on the Cheap? 181

Don’t Ignore U.S. Investors’ Flows Abroad 182

Currency Reserve Diversification: OPEC and the Middle East 185

Further Currency Diversification Is Inevitable 187

The View Ahead 189

Chapter 8 Commodities Supercycles and Currencies 191

The Current Commodity Cycle versus Previous Cycles 193

Dissecting Commodity Classes 196

Commodities and their Currencies 207

Developing World to Maintain Ripe Outlook for Food and Grains 208

Energy Efficiency Not Enough to Halt High Oil 214

Copper and Gold to Shine on Long-Term Fundamentals 219

Commanding Heights or Common Bubbles? 223

Chapter 9 Selected Topics in Foreign Exchange 225

Revisiting Yield Curves 225

Is Dollar Stability a Necessity? 230

How Far Will Commodities Outstrip Equities? 236

U.S. Politics and the U.S. Dollar 240

Conclusion 247

Bibliography 249

About the Author 251

Index 253