European futures are trading higher this morning picking up the positive momentum from the
Asian markets. What market is really anticipating is that Greece will not leave the eurozone, and hopes are that both sides will establish a mutual benefiting agreement. The talks will resume between Greece and its creditors once again today, however, we will not be surprised, if there is no substantial agreement and the saga could continue for while.
Despite the uncertainty in the market, which does bring huge volatility, volume could be on the lower side, as the biggest market in the world- the U.S. is enjoying their long weekend. Therefore, we are expecting a low volume but still relatively volatile session.
Making record highs was a norm for the equity markets last year and it seems like the trendy has picked up this year. We had the record highs in the U.S. and in Europe last week and today, the Nikkei index has pushed its boundaries, despite the GDP data, which was below estimates, but helped the country to crawl out of recession. The GDP data came in at 2.2% where as the forecast was for 3.7%. So the focus is back on the Japanese central bank to not only carry what they are doing, but also top their fuel tanks with more energy to increase the heat.
As for energy market, traders are trying to figure out if we have put the bottom and the only way for the price is to move higher? It is a million dollar question! The fact is that it is incredibly hard to pick up the exact bottom however, when the sentiment is extremely bearish and any further negative news does not make much impact on the price, then you could say that perhaps we have a bottom. The fact is that at that occasion any positive news could ring a massive upside move for that derivative, which we have seen for crude. So, if you are not already on this train, perhaps it may not be a bad idea to start testing the water.
Both crude and Brent are still extremely cheap when you compare the price their peak or when you look at the bottom. Brent is trading near 61 dollar when the bottom was at 49 and the peak is at the 115 dollar mark.