Andrew Wilkinson, Interactive Brokers

FX brief: Interactive Brokers

Andrew Wilkinson is the senior market analyst at Interactive Brokers Group, where he provides daily commentary and analysis on U.S. equity options trading throughout the trading day. Andrew provides webinars designed to explain option-related trading scenarios covering futures, fixed income, forex and equities.

Interactive Brokers conducts its broker/dealer and proprietary trading businesses on over 70 market destinations worldwide. In its broker dealer agency business, IB provides direct access (“on line”) trade execution and clearing services to institutional and professional traders for a wide variety of electronically traded products including stocks, options, futures, forex, and bonds worldwide. In its proprietary trading business IB engages in market making for its own account in about 6,500 different electronically traded products. Interactive Brokers Group and its affiliates execute approximately 700,000 trades per day.

Germany lays out the pool towels as Greece wobbles

12 September 2011
It’s not hard for vacationing tourists to become irritated by German holiday-goers who neatly lay out their pool towels seemingly before the sun is up.

Greenback nears eight-week peak

9 September 2011
The dollar is challenging its highest level in eight weeks after the President delivered a difficult choice for lawmakers: Pass this bill or incur the wrath of an increasingly irritable middle-class America tired of watching the Washington circus put the economy at risk on account of personal self-interest.

Risk rebound dampens dollar ahead of Obama delivery

7 September 2011
After a plunge in risk appetite on Tuesday when many investors baulked at stocks, favoring the safety of the dollar and even treasury notes at record lows. A fresh look midweek at affairs has investor optimism on the rebound with the dollar under a little pressure as all eyes turn to speeches Thursday from Bernanke and Obama.

Truly Ugly

2 September 2011
Few words can describe the August payroll reading of “no-change” – but the few that I can think of are: Truly ugly. The dollar staged a tentative advanced on the lack of hiring as investors probably quite rightly concluded that the stage is set for a further bout of quantitative easing.

Tools for the New Economy

31 August 2011
For an economy still vulnerable to adverse shocks and where even the central bank is taking pot-shots at the inaction of government, the policy options look increasingly limited. The dollar has grown weary of sizeable quantitative response which most investors blindly accept as swelling the supply of money.

Dollar mixed as hopes for Jackson Hole solution fade

25 August 2011
Two stimulus-driven stories are shaping up events on Wall Street on the eve of Bernanke’s Jackson Hole address. “Don’t expect Bernanke to offer more support for the economy,” is the warning from former Soros advisor, Richard Medley. He says that rear-view inflation resulting from the first two waves of quantitative easing have created resistance among FOMC members to doing more. But better-targeted relief could be on its way according to a New York Times article characterizing refinancing for millions of homeowners with mortgages backed by government agencies Fannie Mae and Freddie Mac. The loose talk is that qualifying borrowers could have mortgage rates reset to 4% freeing up more in terms of disposable income.

Yen rises after intervention revamp

24 August 2011
The recent bout of volatility continues to challenge investors across all asset classes. Many refer to market declines as typical of ascending volatility, but in its true meaning the term depicts a period of increasing uncertainty with prices prone to surge and fall causing investors to sharpen their reactions. This picture remains true ahead of Friday’s delivery by Ben Bernanke where it’s hard to gauge consensus. Equity investors are proving resilient in anticipation of further stimulus in order to prop up demand and earnings. Currency dealers are concerned that any kind of stimulus announcement would further debase the value of the dollar. Fixed income traders seem resigned to eternally low rates. After all, what are the chances that Bernanke will say that bond yields are too low when the purpose of quantitative easing is meant to depress yields to spark borrowing? But then again, how likely is he to pin the recent slide in yields on the U.S. credit-rating downgrade from Standard and Poor’s?

Investors rejoice on hopes for softer landing

23 August 2011
Investors found solace by shining the torchlight into dark recesses around the world. Overnight and on the back of some admittedly welcome economic data releases, the world looked like a less gloomy place. The impact in currency markets has lessened demand for the solace of safer pastures while encouraging dollar sales in order to fund entry into riskier propositions in the hope that a snapback in risk appetite might be in order after several weeks of a solid downdraft. The Swiss franc and yen both weakened but the greenback suffered worse raising the stakes for the Bank of Japan after the relief rally still showed increasing tensions in the dollar-yen pair.

What’s in the Hole Ben?

22 August 2011
It’s going to be a long week with market observers deferring predictions until Fed Chairman Bernanke delivers his Jackson Hole speech on Friday. Between now and then economists and analysts will be trying to second-guess the likelihood and the impact of a third wave of quantitative easing. Optimism developed over the weekend that the Fed would be more likely to come to the rescue than not at this Friday’s central bank symposium sponsored by the Kansas City Fed. The meeting presents Ben Bernanke with the opportunity to expand upon the full array of policy tools referred to in the August 9 FOMC policy statement. Anticipation amongst investors is running high that QE3 is just around the corner, which is a contributing factor to a weaker dollar to commence the week.

Fed’s Plosser: This ain’t working guys

18 August 2011
Market fears are creeping insidiously out of the wood work as fractious central bankers try to explain where there colleagues are going wrong and as bank economists rein in their growth forecasts.

Investors lose patience with dollar as Empire State output slips

15 August 2011
Stalling output in the tri-state area surrounding New York saw the dollar slide on Monday after the New York Federal reserve reported a third monthly contraction in the level of manufacturing activity.

Early rebound for equities keeps dollar on back foot

12 August 2011
Currency trading has calmed after a frenzied week during which the yen surged to the point that bulls handed the Bank of Japan every reason under the rising sun to intervene for a second week running. The dollar jumped in both directions. Its typical safe haven status has been weakened by the threat of quantitative easing.

Fresh shocks to confidence

11 August 2011
Investors are increasingly concerned at the lack of response from central bankers and governments as confidence across markets deepens. Fed Chief Bernanke yesterday met with President Obama this week to discuss the alarming situation at a time when panic was growing fuelled by ill-founded rumors of a French sovereign downgrade and a collapse in one of the nation’s leading banks. The obvious challenge facing the two is simply how to address the problem with arguably fewer tools than three years ago.

Hopes high for more quantitative easing – dollar weaker

9 August 2011
Tuesday's FOMC statement will be closely watched to see what the world's largest central bank might have up its sleeve to make investors' pain magically disappear.

Safe haven or not, dollar rallies after S&P ratings downgrade

8 August 2011
Both the U.S. dollar and treasury prices are stable, at least relative to the financial Armageddon dragging down global equity and commodity markets, leaving many onlookers wondering how the world’s largest government can get away with a downgrade as unscathed as it appears to be.