The Ruble is 3% stronger today and hovering around 52 Rub/USD. The currency is 25% stronger than it was on Feb 1 and 40% better than it was on near the closing level of mid-December when it spiked lower. The currency also is now trading below its 200mda for the first time since July 2014.
On Fast Money last night Dennis Gartman, editor of the Gartman Letter explained his view on Russian Oil and Puttin.
Russia – 7th straight down day and getting closer to our trading buy call.
The pain trade in the Sochi Olympics has been pulling for the Russian hockey team (who was eliminated today. As Dick Enberg would say “Oh my!”) but the pain trade in the currency markets may in fact be the Russian Ruble which today has fallen to all-time lows against the Euro and dancing near worst of the crisis (Feb 09) and all-time lows.
Looking at the Russian ruble against the U.S. dollar looks like it was trying to mimic the Space X launch yesterday. I can just imagine what a beautiful sight the launch was as the rocket cleared roof lines.
As U.S. consumers applaud lower gasoline prices, our gain is someone else’s pain. As with any trade, there are two sides: stock markets that depend on the price of crude oil are feeling the pinch as prices move lower.
With the lightened holiday trading the currency markets are consolidating thus far and appear to be avoiding violent intraday price swings on the thin volume. This condition may not hold true as traders come back online in the overnight session.