Summary:

• Euro along with the European stock markets trim their morning losses caused by a fiasco in German coalition talks
• Commodities are on the back foot as the new week unfolds
• Bitcoin and its major peers on the rise as the former hovers above $8000

The new week has begun quite anxiously after Angela Merkel failed to forge a new government in the aftermath of the election which took place nearly two months ago. In effect the euro along with the German equity market have found themselves under pressure, however they’ve managed to recover since then. At the time of writing the euro is trading flat against the US dollar (not too much from 1.1800) while the DE30 is rising 0.2%. Bear in mind that German president Steinmeier is scheduled to speak at 1:30 BST (it’s worth remembering that it’s up to him whether to hold a new election). Looking elsewhere one may notice that the US futures are pointing to the calm opening.

On the FX front the Norwegian krone is the weakest currency in the G10 which could be a side-effect of falling oil prices, the Swedish krona and the Canadian dollar have been on the back foot as well. On the other hand the NZ dollar is gaining the most being up 0.3% against the greenback, there have been no specific stories standing behind this move though. In terms of oil prices it’s worth highlighting that the latest CFTC report showed that the long speculative positioning on the WTI grade had increased the most for many years.

The last week on Bitcoin was exceptionally tumultuous as there was huge volatility with resulted in a new all-time high above $8000. Bitcoin climbed subtly above $8100 on Sunday according to the data delivered by coindesk.com. Even as buyers have taken a step back since then, the most famous digital currency is holding onto a round $8000 level suggesting that there is still some fuel to pro up the ongoing upward move. The main reason which could have contributed to an increase in Bitcoin (and other virtual currencies as well) was rising interest from hedge funds.

Investors should focus on central banks this week as we get minutes from Fed, ECB and RBA. Moreover, President Draghi is to speak at the European Parliament which will be a key figure in a calm Monday’s calendar. It’s also worth mentioning that due to Thanksgiving on Thursday the activity on markets could be subdued. Moreover, Black Friday sales results will be an indicator of the strength of the US consumers.