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Date: 15th January 2024.

JPN225 Again Renews its All-Time Highs, Yen Down Against All Currencies!


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  • China keeps interest rates on hold at 2.5%, whereas investors were previously expecting another rate cut. Asian stocks mainly rise after the Bank of China announcement and Taiwan election results.
  • The World Economic Forum kicks off in Davos. Economists, brokers and bankers will be discussing the global economy, interest rates and inflation throughout the day. Traders will be listening keenly to how bankers view inflation after US and EU inflation rose.
  • No US trading on Monday 15th, for Martin Luther King Day, meaning limited volatility for the Dollar. Friday‚Äôs earnings data ‚Äúmixed‚ÄĚ and provides no particular support for stocks.
  • The Pound sees ‚Äúmixed‚ÄĚ price movement on Monday before the release of major economic data for the UK.
GBPJPY ‚Äď Investors Await UK Employment Data and Inflation!

Investors turn their attention to the GBPJPY ahead of major economic releases for the UK. Additionally, the Yen struggles against all currencies on Monday providing FX traders with further opportunities. The GBPJPY has risen 0.40% in this morning’s Asian session and continues to obtain buy signals from indicators. The Pound has been supported by the UK’s Gross Domestic Product which rose 0.3%. As a result, the UK economy continues to avoid a recession and the Bank of England is less likely to consider interest rate cuts.

The growth in the UK’s Gross Domestic Product was primarily due to the acceleration of the services sector by 0.4%. From the G7, the Bank of England is the regulator which is expected to cut interest rates the least. Investors expect the Federal Reserve to cut rates in March or May, whereas the Bank is England is not likely to do so until the Summer. If this transpires, the Pound can potentially gain, particularly if the Bank of Japan remains ultra dovish.

The Pound is likely to experience a lot of volatility over the next two days due to four upcoming announcements. These include the change in Unemployment Claims, Average Earnings Index, the Bank of England Governor Speech, and the UK Consumer Price Index. If the UK’s employment sector remains resilient and inflation remains above expectations, the Pound is likely to again rise. Analysts expect inflation to decline from 3.9% to 3.8%. However, the Pound potentially can increase if inflation does not decline. Anything below 3.8% will be considered positive for the Pound.

In terms of technical analysis and indicators, the exchange rate has been obtaining buy signals since January 3rd. Since then, the price continues to trade above the price sentiment line, above 50.00 on the RSI and continues to form higher lows. If the price increases above 185.495, further buy signals will be seen as the asset crosses the 61.8 mark (Fibonacci). However, investors should note that this will also depend on tomorrow’s UK employment data and Bank of England Speech.

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Nikkei225 Continues to Renew its All-Time Highs

Earnings season started on Friday, with mixed results from the banking sector. However, the global stock market performed generally well as US Producer Inflation unexpectedly fell. The JPN225 is increasing in value for a ninth consecutive day and is trading more than 6% higher than its previous all-time highs. The bullish price movement is a result of an ultra-supportive monetary policy and a weakening Japanese Yen.

Economists expect that the Bank of Japan in its quarterly outlook report will cut its initial estimate of inflation. This is considered a key indicator of the broader price trend, believed to weaken from the current 2.8% to 1.9% for both fiscal year 2024 and 2025. As consumer price growth has beaten the 2% threshold for more than 12 months, investors believe that the central bank will abandon its ultra-loose policy and increase the interest rate. The Bank of Japan’s interest rate has been at -0.10% since 2016. If rates rise, the JPN225 may struggle to hold onto gains unless earnings remain strong, and the global economy experiences higher growth.

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Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 16th January 2024.

Dollar Demand Rises and Global Stocks Tumble, Find Out Why!

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  • Investors price in 6 rate cuts in 2024, but all Fed members remain hawkish. Economists advise investors are getting ahead of themselves and the Fed is only likely to cut 3 times.
  • Finance giants gather in Davos and advise markets rate cuts are premature and the risk of inflation still remains.
  • Trump beats Ron DeSantis in Iowa and is on track to represent the Republicans in the 2024 US elections.
  • The UK‚Äôs employment sector remains resilient, but salaries again see a considerable slow-down. The salary slowdown pushes the Pound lower.
GBPUSD ‚Äď UK Salaries Decline And Dollar Demand Rises!
The GBPUSD is trading at its lowest level since January 5th after being pushed lower by Dollar strength and UK data. The US Dollar Index has been increasing in value for 3 consecutive days due to higher inflation data and hawkish comments from global banking leaders. Another indication that interest rates are likely to remain high is this week’s bond yields. During this morning’s Asian session, the US 10-Year Bond Yields rose 0.055% and again rose above 4.00%. Higher bond yields are known to be Dollar bullish, but investors will monitor if bond yields can hold onto gains. This is something yields were not able to achieve last week.
The Pound this morning is declining against all currencies which provides traders with clear opportunities within the GBPUSD. However, the data from the UK is not ‚Äúall bad‚ÄĚ for the Pound. The UK‚Äôs Claimant Count Change read 11,700, lower than previous expectations and lower than the previous 3 months. Strong employment means higher consumer demand and means a trickier fight against inflation. However, the lower earnings do help regulators fight against inflation. As a result, investors are ditching the Pound in favor of the Dollar.
According to analysts, investors today have preferred the Dollar where there is already confirmation that inflation rose. Nonetheless, the Pound may correct if tomorrow’s UK inflation data is higher than the 3.8% expectations. Though, if inflation does read 3.8% or lower, the Pound may witness further downward momentum.
When evaluating indicators and technical analysis, the GBPUSD exchange rate is currently witnessing potential sell signals. The price is trading below trend-lines, average price movements and below the neutral on most oscillators. The price is also trading below the regression channel and the regression channel is also widening while declining. All the above indicates downward price movement, however, if the price rises above 1.27127, these signals can potentially change.
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US30 ‚Äď Global Sentiment Towards Stocks Declines. Eyes on Goldman Sachs Earnings!
The US30 is experiencing a decline during this morning’s Asian session, similar to all other US indices. The US30 was pressured by negative earnings data from the banking sector on Friday as well as the possibility of less rate cuts this year. However, technical analysts remind investors that the price has declined to a previous support level which the asset has not been able to break on the past 3 occasions. Traders monitor the price action as the asset tests this support level.
The next vital announcement for the asset will be Goldman Sach’s earnings report which will be made public before the US Session opens. Analysts expect the banking giant to see a 23% drop in earnings per share and a slight decline in revenue. Though, if the data is lower than expected, the stock price can decline. Goldman Sachs is the third most influential stock within the Dow Jones and holds 6.63% of the index.
Lastly, another negative for the USA30 is the stock market performance today globally; UK, EU and Asian indices are trading lower. The poor sentiment within the stock market is largely due to hawkish comments from the Fed and finance ministers in Davos. Analysts advise investors are pricing in up to 6-7 rate cuts in 2024, but banks are predicting 3-4.
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Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 17th January 2024.

Eurozone Economic Trends: Inflation, Growth, and Central Bank Outlook.



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In the ever-evolving landscape of the Eurozone economy, key indicators suggest a complex scenario of lower inflation and weakened growth. While central bank officials express optimism about a potential soft landing, the ongoing improvement in German ZEW investor confidence supports this outlook. As we delve into the intricacies of economic data, it becomes evident that the European Central Bank (ECB) is contemplating rate cuts later this year, despite maintaining a cautious wait-and-see stance, while investors are onec again buying into hopes of early trade cuts.

Eurozone data so far was mixed, with German HICP ticking up at the end of 2023 and German ZEW investor confidence coming in stronger than anticipated. At the same time, consumer inflation expectations declined, according to the latest ECB survey. ECB officials meanwhile continued to signal that it is too early to talk about rate cuts, even if ECB’s Villeroy repeated that rates are set to decline this year.

German Inflation Landscape: German HICP inflation, confirmed at 3.8% y/y for December, reflects a nuanced picture. The rise in national CPI to 3.7% y/y is partly attributed to base effects from a one-off energy support payment in December 2022. Notably, food price inflation eased to 4.6% y/y, contributing to an overall inflation rate of 3.5% y/y when excluding energy and food. The challenge lies in the impact of these rising prices on disposable income, weighing on demand and overall growth.

Economic Contractions and Optimism: The German GDP contracted -0.3% last year, with adjusted figures showing a flash estimate of -0.1%, potentially indicating a technical recession in the latter half of 2023. Factors such as high inflation, increased debt financing costs, and weakened domestic and external demand have posed challenges to the recovery from the pandemic. Despite these setbacks, German ZEW investor expectations unexpectedly improved, suggesting a cautious optimism driven by hopes of major central bank rate cuts.

Eurozone Industrial Production and Trade Dynamics: Eurozone industrial production contracted -0.3% m/m in November, aligning with expectations and signaling a potential decline in GDP for the last quarter of 2023. Concurrently, the Eurozone seasonally adjusted trade surplus widened to EUR 14.8 billion in November, driven by a rise in exports and a decline in imports. However, the subdued improvement in real terms indicates that the widening surplus may not necessarily signify an overall economic upturn.

Central Bank Insights and Currency Movements

ECB officials remain vigilant, emphasizing that it is premature to declare victory over inflation. Despite differing opinions within the central bank, the latest ECB survey shows a drop in consumer inflation expectations. Geopolitical risks further complicate the outlook, with potential impacts on inflation. Austrian central bank head Holzmann cautions against expecting a rate cut in 2024 amid increasing geopolitical threats.

In the current WEF Annual Meeting, ECB‚Äôs Lagarde¬†flagged rate cuts in the summer. When asked about a possible rate cut in the summer the central bank head told Bloomberg she suggested that there is likely to be a majority in favor of such a move by then, but cautioned that the ECB has to be ‚Äúdata dependent‚ÄĚ. Lagarde stressed ‚Äúthat there is still a level of uncertainty and some indicators that are not anchored at the level where we would like to see them‚ÄĚ. Meanwhile,¬†ECB‚Äôs Knot stated¬†it‚Äôs unlikely that rates will go up again, but he warned that the ECB needs to see a turnaround in wages before making a decision and that any easing, if it happens, will be very gradual. Knot also stressed that the more easing markets are pricing in, the less likely it is that the ECB will indeed cut rates. More push back against excessive rate cut expectations has put bonds under pressure this morning, amid the large number of central bankers stressing that rate cuts are not on the agenda for now.

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EURO: Central Bank and Growth Outlooks Influence Exchange Rates

In the currency markets, EURUSD has undergone correction in response to central bank and growth outlook uncertainties. With the USDIndex surpassing the 103 mark and Treasury yields fluctuating, EURUSD corrected to 1.0883, reflecting the dynamic interplay of market forces.

EURJPY has been oscillating within the 158.50-160.00 range after experiencing a robust rebound to a one-month peak of 160.17 last week.

From a technical perspective, the short-term range is delineated by the 50% and 61.8% Fibonacci retracement levels from the previous decline. Notably, the sequence of higher highs and higher lows, initiated from December’s low point, remains encouraging.

Furthermore, the Relative Strength Index (RSI) is still hovering above its neutral mark of 50, and the Moving Average Convergence Divergence (MACD) is showing marginal strengthening, positioned slightly above its zero and signal lines. This maintains a positive bias in the market sentiment.

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Practically, for the bullish momentum to persist, a decisive close above the 160.00-160.50 zone is essential. This breakthrough could pave the way for an advance towards the 78.6% Fibonacci level at 162.00 and the previously breached ascending trendline from March 2023, located at 162.70. Further upward movement may retest the ceiling observed in November at 163.70-164.28.

Conversely, if the price dips below the 158.50 support, a period of consolidation might occur around the 38.2% Fibonacci level at 157.40 before sellers target the lower boundary of the bullish channel at 156.45. A bearish breakout from this point could extend towards the 200-day Exponential Moving Average (EMA) positioned at 155.20.

In summary, while EURJPY retains bullish momentum, a sustained breach above the 160.00-160.50 region is crucial for a more significant upside potential.
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 18th January 2024.

Gold Council Indicates Higher Prices Amid Geo-Political Tensions.


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  • The US Dollar Index ends the day higher for a fifth consecutive day but declines during this morning‚Äôs Asian Session.
  • Investors continue to lower the possibility of significant easing in 2024 after the latest US Sales data.
  • US Core Retail Sales were twice as high as expectations and rose to a 3-month high. Additionally, US Industrial Production was 0.2% higher than analysts‚Äô expectations.
  • The British Pound gains after inflation rose from 3.9% to 4.00%. The GBPJPY this morning is trading close to all-time highs.
  • Gold Report indicates high demand for Gold from institutions amid Middle East tensions and possible lower rates.
USA100 ‚Äď The NASDAQ Declines But Outperforms Other Indices Due to Upcoming Earnings

The USA100 ended the day lower for the first time after 8 days of consecutive increases. However, technical analysts are noting that the price has shown signs of weakness since November 11th. The price yesterday fell to a new weekly low but quickly saw buyers re-enter the market. Earnings season starts next week for the technology sector and the bullish momentum is likely to remain only if earnings continue to impress. The Dow Jones and the SNP500 did not see an increase in buy orders like the NASDAQ. This is due to significant earnings expected next week for the technology sector.

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When looking at the NASDAQ‚Äôs individual components, which determines and drives the price movement of the USA100, most stocks were trading lower. Of the top 20 influential stocks only six ended the day high. Of the ‚Äúmagnificent seven‚ÄĚ stocks, only Meta rose in value, but not enough to obtain buy signals. From the most influential stocks Intel witnessed the strongest decline falling 2.12%.

Investors continue to scale back interest rate cuts after US data remains strong and economists at Davos correct the market‚Äôs outlook. The latest US data was the Retail Sales which read 0.6% and Core Retail Sales reading 0.4%. Both releases read higher than expectations and led to a decline in the USA100 and other indices. The higher UK inflation also lowered global investor sentiment. Today‚Äôs price movement globally signals a slight ‚Äúrisk on‚ÄĚ sentiment but the question remains as to whether this will remain.

During this morning‚Äôs Asian session, the USA100 is trading higher increasing by 0.20%. If we look at most indices around the globe including the JPN225, GER40 and Hang Seng, all are rising. When looking at technical analysis, the price of the USA100 is yet to obtain a ‚Äúbuy signal‚ÄĚ from Moving Averages and Oscillators. However, the price is trading higher than the VWAP indicator and buy orders are reading higher than sell orders. Therefore, if upward momentum remains, buy signals will start to materialize after surpassing $16,784.
 
XAUUSD ‚Äď World Gold Council Indicates Higher Gold Prices!

Gold fell for a second day on Tuesday after the Dollar continued to strengthen. Bond Yields also rose, which applied further pressure on the commodity. However, Gold trades slightly higher this morning as the Dollar retraces and bond yields decline 0.010%. However, as the European Session opens the Dollar has slightly risen and most other major currencies are declining except the Yen. Therefore, the market still sees demand in safe haven currencies which can negatively affect Gold.

If Gold’s price remains above the pivot point at $2,005.70, buy signals are likely to continue to materialize. The same applies if XAUUSD rises above $2,014, but longer-term timeframes continue to signal weakness in Gold. However, the latest World Gold Council report advises the possibility of a higher Gold price remaining. According to the report, demand amongst central banks remains high and amid tensions in the Middle East many countries continue de-dollarization. Nonetheless, the timing cannot be known, therefore technical analysis remains vital.

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Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 19th January 2024.
 

Market Recap: Global Stocks on AI rally; Yen Drifting.

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Economic Indicators & Central Banks:
 
  • US labor-market data, strong weekly jobless claims, and higher-than-expected retail sales have added pressure against market rate-cut expectations.
  • Markets now pricing a¬†57% chance of a US rate cut¬†in March, down from 75% a week ago.
  • Central bankers¬†suggest markets are overly being aggressive in pricing rate cuts for 2024, contributing to the Dollar‚Äôs resurgence amid turbulence in¬†China‚Äôs property¬†and financial markets.
  • Japan‚Äôs core inflation¬†slowed to 2.3% in December, its lowest annual pace since June 2022, easing pressure on policymakers and weakening the Yen to 148.44 per dollar.
  • UK:¬†An unexpected rise in British inflation has also led to a pullback in bets on Bank of England rate cuts, supporting the Pound.
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Market Trends:
 
  • The TSMC projection of 2024 revenue growth¬†of over 20% boosted Tokyo Electron and Advantest, contributing to a total 497-point jump in the Nikkei on the day, with respective advances of 6.03% and 8.2%.
  • Chip-related shares, influenced by US peers‚Äô gains, were prominent performers. Its earnings spurred the biggest rally in chipmakers in more than a month on Thursday and pushed the¬†Nasdaq 100 index to close at an all-time high.
  • Chip-industry stocks led a rally in¬†Japan‚Äôs Nikkei share average, contributing to a 1.4% daily gain to close at¬†35,963.27, and a¬†weekly gain of 1.09%.
  • ‚ÄúThe better-than-expected results from TSMC could be positive signals on demand recovery,‚ÄĚ said An Hyungjin, chief executive officer and fund manager at Billionfold Asset Management Inc. ‚ÄúWith strong AI demand, not only the US big tech firms but also most tech firms around the world have to invest in AI and that could be good news to stock markets.‚ÄĚ
Financial Markets Performance:
 
  • The¬†USDIndex¬†is set for a¬†2nd consecutive weekly gain¬†as signs of strength in the US economy and cautious remarks from central bankers reduce expectations of rapid interest rate cuts.
  • AUDUSD¬†and¬†NZDUSD¬†are on track for their largest weekly gains since November and July, respectively.
  • Bitcoin¬†hit a 5-week low at¬†$40,484¬†as traders took profits following US approval of spot Bitcoin ETFs. Investors poured $1.9 billion into new bitcoin ETFs in the first three trading days, falling short of some aggressive estimates.
  • Oil prices¬†held steady at a 3-week high amid escalating tensions in the Middle East, where the US and Iranian-backed Houthis engaged in tit-for-tat strikes affecting global shipping.
  • UKOIL¬†hovered around¬†$79¬†per barrel after a 1.6% rise, while¬†USOIL¬†stood above¬†$74,¬†supported by a decline in US inventories. The US conducted multiple attacks on Houthi targets in Yemen, but shipping remains under threat. President Biden affirmed continued US strikes. Crude prices, marked by volatility, face conflicting factors, including Middle East tensions, Fed rate cut uncertainty, and a well-supplied market forecast by the International Energy Agency.
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 22nd January 2024.
 

Market Recap: Stocks extend rally.

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Economic Indicators & Central Banks:
 
  • China‚Äôs lending rates remain unchanged.¬†That followed the PBOC‚Äôs decision to maintain borrowing costs earlier this month, which was another disappointment that did little to boost Chinese stock markets.
  • Recent data showing resilient US economic activity has caused¬†a shift in expectations, with markets now predicting rate cuts to start in May instead of March.
  • European¬†&¬†US¬†stock¬†futures keep rising, extending the rally in global equities that pushed the¬†US500, US100 and US30¬†to all-time highs.¬†Optimism over expected Federal Reserve interest-rate cuts and the artificial-intelligence boom boosted Equities.
  • Interest rate futures indicate a 100 basis points gap between market expectations and the Fed‚Äôs own projections for year-end rates, contributing to the dollar‚Äôs struggles.
  • In political news, Ron DeSantis withdraws from the US presidential race and endorses Republican front-runner Donald Trump ahead of the New Hampshire primary on Tuesday.
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Market Trends:
 
  • Chinese markets¬†underperformed again today toward their lowest level in almost two decades. The¬†Hang Seng¬†plunged -2.8%, the CSI 300 -1.5%. Chinese tech behemoths including¬†Meituan¬†and¬†Tencent¬†Holdings Ltd. were among the biggest drags.
  • JPN225¬†rallied to a fresh¬†34-year peak today (closed at 36,546.85) on weaker yen but also mainly¬†as the¬†US500‚Äôs¬†record-high close on Friday buoyed investor sentiment, despite continued signs of overheating in the Asian market.
  • DAX¬†and¬†FTSE¬†100 are up 0.9% and 0.5% respectively while Treasuries have pared overnight gains, and the 10-year rate is now up 0.8 bp at 4.13%. The short end is underperforming in both the US and the EU.
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Financial Markets Performance:
 
  • The¬†USDIndex is struggling to extend above¬†103 due to uncertainties related to central bank decisions in Japan and Europe this week.¬†EURUSD¬†down to¬†1.0890.
  • USDJPY¬†had a notable movement, bouncing from a 1-month low to a high, impacted by the Bank of Japan‚Äôs 2-day meeting and the expiry of a large amount of currency options.
  • Oil prices¬†are down as OPEC member Libya restarted output at its largest field, bolstering global supplies and overshadowing for now concerns about tensions in the Red Sea that look set to continue disrupting shipping.
  • Key events for the week¬†include the first estimate of US Q4 GDP, central bank meetings in Japan, Canada and Europe, South Korean economic output data, and initial readings of purchasing managers‚Äô surveys in Europe for 2024.
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 23rd January 2024.
 

Market Recap: Asia stocks higher; Yen up post Ueda’s comments.

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Economic Indicators & Central Banks:
 
  • China:¬†Reports that Chinese officials are looking into a¬†rescue package¬†for the beleaguered stock market has given¬†Asian equities, and particularly the Hang Seng, a big lift. Sources suggest authorities are proposing some $278 bln be invested in onshore funds.
  • Japan:¬†The BoJ left policy unchanged, maintaining its -0.100% policy rate and keeping YCC intact, as well expected. BoJ governor Ueda said there is more certainty in the outlook, which saw JGBs paring earlier gains. There were no significant indications on forward guidance. We see more of a dovish lean from the downwards forecasts, with the Bank likely to leave its stance in ultra-accommodative mode until April when the wage talks should be under our belt.
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Market Trends:
 
  • Asian stock markets mostly moved higher, with the¬†Hang Seng¬†surging 3% to a session peak of¬†15,472¬†before paring gains to¬†15,345.¬†The¬†CSI¬†rose to 3240 after slumping to a 5 year low of¬†3218¬†yesterday. It was at a 2023 peak of 4201 in late January 2023.
  • The¬†JPN225 (Nikkei)¬†is up 0.29% to 36,630.
  • Stock futures are higher across Europe, but while the¬†US100(NASDAQ)¬†has found buyers, the¬†US30(Dow Jones)¬†is slightly lower but holds above its record high at 38k.
  • Microsoft¬†and other tech giants along with¬†Goldman shares, which jumped 1%, have boosted the Dow higher.
Financial Markets Performance:
 
  • The¬†USDIndex¬†slipped to 102.70 from 103.384 and is seeing broadbased declines.
  • USDJPY¬†has been choppy, spiking to 148.55 before drifting down to 147.86.
  • Oil prices¬†reached $75 again, as US and UK launch new strikes at Iran-backed Houthi rebels in Yemen, adding to the tension in Middle East.
  • BTCUSD¬†dropped below¬†$40,000¬†as the launch of the first US ETF holds the digital currency abated, as investors take profits off the table.¬†Ether, the second-largest cryptocurrency, fell 6% to $2,325.Copy-of-TELEGRAM-.png
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

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Andria Pichidi
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 24th January 2024.
 

Market Recap: China bourses move higher amid stimulus hopes; JGB yields spike.

eu_update_pic_nov18-1-696x391.jpg
Economic Indicators & Central Banks:
 
  • Expectations the¬†FOMC¬†is done hiking rates continued to support Wall Street even if aggressive rate cut bets have been trimmed, while earnings were mixed.
  • Yields remain mostly higher, but off their peaks after the decent 2-year auction ($60 bln 2-year note sale). The Treasury is selling $61 bln in 5-year notes Wednesday and $41 bln in 7-year notes Thursday.
  • Corporate supply has helped keep the market heavy.¬†IADB priced a $4 bln 5-year SOFR. Also, Romania sold $4 bln in 5- and 10-year notes. Sweden sold a $2 bln 2-year. Bank of New Zealand priced a $750 mln 5-year. Cote d‚ÄôIvoire has a $2.6 bln 2-parter. CPPIB Capital offered $1.5 bln in 3-year SOFR.
  • Japan¬†reported its exports jumped nearly 10% in December.
  • Japanese markets underperformed, with both stocks and bonds hit by speculation that the BOJ is laying the ground for an exit from the negative interest rate environment.
  • The China Securities Regulatory Commission, called for better protections for investors and for instilling confidence in the potential for gains in the markets, which have faltered in recent months.
2024-01-24_09-52-20.jpg

Market Trends:
 
  • Asia: Hong Kong‚Äôs Hang Seng¬†surged 2% to 15,569.39, helped by gains in technology companies like e-commerce giant¬†Alibaba, which surged 3.8%.¬†JPN225¬†(Nikkei) lost 0.8% to 36,226.48.
  • The¬†US500¬†added to its gains, rising 0.29% to its third straight fresh all-time high at 4864.6¬†US30¬†however was drag lower as¬†3M tumbled more than 10%¬†on Tuesday after the company‚Äôs 2024 profit outlook came in below expectations.
  • eBay¬†will lay off about 9% of its full-time workforce.
  • Procter & Gamble climbed 4.1% & United Airlines flew 5.3% higher¬†after stronger profit for Q4 2023.
  • Netflix rallied 8%¬†afterhours after the video streaming service handily beat subscriber estimates in the Q4.
  • ASML Holding,¬†a chipmaking equipment maker, reported Q4 earnings that beat expectations and its best-ever quarterly orders, but it kept a cautious outlook for 2024 as it faces new restrictions on exports to China.
  • Futures are higher across¬†Europe¬†and the¬†US¬†as Treasuries and Eurozone bonds advance.
Copy-of-TELEGRAM-1.png

Financial Markets Performance:
 
  • The¬†USDIndex¬†found legs and rallied to¬†103.57.¬†It was firmer against 7 of its G10 peers
  • USDJPY¬†steadied on 147.70 as Yen gained support after chief Kazuo Ueda said on Tuesday that the prospects of achieving the BOJ‚Äôs inflation target were gradually increasing.
  • Oil¬†finished -0.3% lower at $74.51 per barrel and¬†Gold¬†was 0.3% higher at $2028.34 per ounce.
  • Bitcoin¬†steadied around $39,700, after sliding as low as $38,505 on Tuesday for the first time since Dec. 1.
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date : 25th January 2024.

Market Recap: Has US avoided recession in 2023? ECB also on tap.

eu_update_1200x628-e1567669197104-696x339.pngTrading Leveraged Products is risky
Economic Indicators & Central Banks:
 
  • Treasuries¬†were weak with yields extending higher still, hit by the¬†double whammy of stronger than expected PMI data¬†and an ugly 5-year auction.
  • The healthy rally on Wall Street also weighed, though stocks trimmed gains into the close.
  • China bourses¬†continued to rally after the PBOC stepped up support measures yesterday by cutting reserve requirements, while hinting at possible rate cuts.
  • ECB Preview:¬†The central bank is widely expected to keep policy settings unchanged and stick with a wait-and-see stance for now, which means rate cuts are not on the immediate agenda.
2024-01-25_10-27-46.jpg

Market Trends:
 
  • Hang Seng and CSI 300¬†already staged a late rally yesterday and continued to move higher today, with gains of 1.8% and 2.0% respectively.
  • European futures¬†are in the red, however, as the¬†ECB¬†meeting comes into view.
  • US futures¬†are slightly higher on the anticipation of US GDP later on which could provide clues as to where US rates might be headed.
  • Tesla‚Äôs¬†profits plummet! Tesla (-5.93% after hours) posted a 23% decline in profits for 2023, its 1st annual decline since 2017!
  • Microsoft¬†becomes 2nd company ever to top $3 trillion valuation on AI-driven rally. Apple remains at the top.
  • FAA halts Boeing 737 MAXproduction expansion. Boeing -1.32% after hours.
Copy-of-TELEGRAM-2.pngFinancial Markets Performance:
 
  • The¬†USDIndex¬†slipped to a session nadir of¬†102.52¬†but bounced back to¬†103.25¬†to close over the 103 level for a 7th straight session.
  • EURUSD¬†is steady at¬†1.0880.¬†The¬†USDJPY¬†regained some ground after hints at rate rises in Japan triggered selling in the Japanese government bond market. It remains below¬†148.
  • USOIL¬†was up 1.45% to¬†$75.44¬†per barrel amid ongoing geopolitical risks and following a bigger than expected US inventory draw.
  • Gold¬†was down -0.83% to¬†$2012.50¬†on the stronger PMI data and further trimming in rate cut bets. Markets have reined in expectations for early rate cuts in the US and Europe, and BoJ governor Ueda yesterday hinted that the exit from the negative interest rate environment is coming into view.¬†That should keep gold range bound for now.
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 29th January 2024.

The Week Ahead ‚Äď Earnings, Central Banks and Geo-Political Tensions!


GOLD-696x391.jpg
  • Tensions rise in the Middle East as three US Soldiers are killed in a base near the Syrian-Jordan border after being attacked by Iran-backed militants. Crude Oil price opens 1.15% higher.
  • Gold rose 0.63% on Monday due to rising tension in the Middle east. Traders are evaluating whether the market will witness a ‚Äúrisk-off‚ÄĚ sentiment this week.
  • All eyes on the Federal Reserve‚Äôs press conference on Wednesday. Analysts expect the Federal Fund Rate to remain unchanged, but the Press Conference will signal the Fed‚Äôs future path.
  • The US economy grew 3.3% in the latest quarter, beating expectations of 2.0%. In addition to this, Pending Home Sales rose 8.3% and the Core PCE Index rose from 0.1% to 0.2%.
XAUUSD ‚Äď Geo-Political Tension Again on The Rise

The US Dollar Index did open Monday‚Äôs trading slightly higher, however, has fallen 0.10% over the past 2 hours as of the time of writing. Instead, investors are increasing exposure to Gold. Gold prices are trading 0.63% higher during this morning‚Äôs Asian Session and have risen above the most recent resistance levels. When evaluating technical analysis, the price of the commodity is trading above price sentiment indicators, above the neutral on most oscillators and above the day‚Äôs VWAP. Here we can see potential ‚Äúbuy‚ÄĚ signals, however, investors also should note significant resistance points at $2,037.80. This level has triggered declines on eight occasions over the past month. If the price maintains momentum and crosses this level, Gold will move into the ‚Äúbuy‚ÄĚ region of the Fibonacci levels.

The price is largely being driven by two factors: the decline in the Dollar and lower investor sentiment due to rising Middle East tensions. The group which conducted the attack is not yet known, however, President Biden has already advised the US will retaliate. According to the White House, the group is most likely an Iranian-backed militant group which is the main concern for investors. Though investors should note that this will only have a short-term effect if the situation does not escalate.

The next price drive will be the Federal Reserve’s Press Conference and the central bank’s forward guidance on interest rates. This will determine if institutions decide to further expose their funds to the Dollar or look for alternatives. The main alternatives will be Gold and US Bonds. If investors are unconvinced the Fed will keep rates high, Gold could benefit from a weaker Dollar. Tomorrow’s JOLTS Job Openings could also create further volatility.

Copy-of-TELEGRAM-MARKET-UPDATE-71-1024x577.png

USA100 ‚Äď Investors Eye Earnings and Fed Press Conference

US investors are concerned about the developments over the weekend and as a result the rising oil price. Another concern for investors is also if the Fed gives an ultra-hawkish signal on Wednesday after strong economic data last week. Last week, the US PMI rose higher than expectations as did the economy’s Gross Domestic Product. Though stocks and shareholders will equally be monitoring this week’s quarterly earnings reports from major companies.

Tuesday Quarterly Earnings Report

Microsoft ‚Äď +1.01% over the past week.

Alphabet ‚Äď +3.30% over the past week.

AMD ‚Äď +1.58% over the past week.

Wednesday Quarterly Earnings Report

Apple ‚Äď Unchanged over the past week.

Amazon ‚Äď +1.35% over the past week.

Meta ‚Äď +1.61% over the past week.

The performance of the USA100 will largely depend on whether the above earnings are higher than Wall Street‚Äôs expectations and on the Fed‚Äôs Press Conference. If the Fed is viewed as ‚Äúultra-hawkish‚ÄĚ, stocks are likely to experience significant pressure if earnings do not exceed expectations.

Copy-of-TELEGRAM-MARKET-UPDATE-72-1024x577.png


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
Edited by HFM
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Date: 30th January 2024.

The Yen Tops All Competitors and Investors Turn to Tech Earnings.


Fotolia_7596044_XS.jpg
  • Monday‚Äôs best performing currency was the Japanese Yen which took advantage of a lack of economic data and a rise in geopolitical tensions.
  • Analysts advise institutions may increase exposure in the Yen due to geopolitical tensions. Japan‚Äôs unemployment rate declines to 2.4%, the lowest in 10-months.
  • The USA100 rises ahead of tonight‚Äôs vital quarterly earnings reports. Of NASDAQ‚Äôs 20 most influential stocks, only three saw a slight decline.
  • Tesla and Illumina were NASDAQ‚Äôs best performing stocks, rising more than 4% each.
USA100 ‚Äď Microsoft and Alphabet Earnings Upcoming

The USA100 rose 1.21% on Monday as demand again rose ahead of major earnings from five of the ‚Äúmagnificent seven‚ÄĚ. Tonight, investors await the quarterly earnings reports from Microsoft, which yesterday rose 1.43%, and Alphabet, which rose 0.68%. However, investors must also monitor the earnings data from AMD which is the 11th most influential stock for the index.

Even with the strong bullish price action over the past 4 weeks, investors should be cautious about short-term volatility. During this morning‚Äôs Asian session, the USA100 is trading 0.16% lower. US indices are known to decline towards the end of the US session and within the Asian session. However, if the price maintains momentum, sell signals can arise. On the 2-hour chart, the price is trading above the 75-bar Exponential Moving Average and above the ‚Äúneutral‚ÄĚ on the RSI. Both indicate strong buying sentiment. However, the latest candlestick is bearish meaning buy signals are not currently active. Fibonacci levels indicate support may be found between $17,505.88 and $17,5870. If the price rises above $17,633, signals will again arise.

Copy-of-TELEGRAM-MARKET-UPDATE-75-1024x577.png

So far this morning the US Dollar Index is trading lower, and bonds are increasing in value. Both are indications that the stock market can potentially gain. However, in order for the USA100 to see significant upward price movement, the index will also need to be supported by tonight’s earnings data.

XAUUSD ‚Äď Fed‚Äôs Future Guidance Key For Gold

Gold is currently experiencing strong volatility in both directions but continues to see buyers overpowering sellers. If we look at the price action from the price gap, the commodity rose by 0.47% and from Friday’s close 0.72%. We can see here even with strong bearish volatility at times throughout the day, Gold still finalized a considerable increase. Gold’s price rose a further 0.15% during this morning’s session, but analysts are slightly cautious about the resistance level.

Copy-of-TELEGRAM-MARKET-UPDATE-74-1024x577.png

The resistance level at $2,040 has been intact throughout the whole month and was only temporarily able to break above this level. Nonetheless, trend and momentum indicators are signalling upward price movement. Today’s CB Consumer Confidence and JOLTS Job Openings will significantly influence the price action of the Dollar and subsequently Gold. If the two economic releases read higher than expectations, Gold can potentially correct back downwards. However, a lower figure can further fuel the upward movement due to its hedge against inflation and alternative to the Dollar.

According to the US Commodity Futures Trading Commission’s latest report, the number of buy contracts rose by 2.211 thousand and sell contracts fell 11.280 thousand. Here we can see a possible shift towards bullish speculation.

EURJPY ‚Äď Japanese Yen Currently The Best Performance Currency

The best performing currency of the day and the week so far is the Japanese Yen. Investors are returning to the Japanese Yen as most currencies within the G7 are expected to cut rates in the upcoming months, whereas analysts expect the Bank of Japan to slightly increase rates just before the summer. According to fundamental analysts, the Yen’s haven status can also serve as an alternative to the Dollar while geopolitical tensions rise.

The Japanese Yen is increasing against all currencies but one of its strongest price movements is against the Euro. The Euro has been put under pressure from a dovish outlook set by investors, not necessarily the Central Bank representatives. In addition to this, France’s Flash GDP figures for the latest quarter read 0.0%, meaning the country was very close to officially being in a recession. Investors now turn to Germany and Italy. If both regions also see lower a lower gross domestic product growth rate, the Euro can experience further pressure.

The Japanese Yen on the other hand is likely to be influenced by three releases scheduled for tonight’s Asian Session. Japan will release the Bank of Japan’s Summary of Opinions, the Prelim Industrial Production and Retail sales. Higher data and a more hawkish central bank can support the Yen further, as did today’s Japanese Unemployment Rate. Japan’s unemployment rate today fell from 2.5% to 2.4%. investors also should note that weaker US data can also support the Japanese Yen indirectly.

Copy-of-TELEGRAM-MARKET-UPDATE-73-1024x577.png


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 31st January 2024.

US Technology Stocks Decline Ahead of the Fed’s Press Conference.


Fotolia_687822_XS-e1541601641504.jpg
  • US Technology Stocks decline ahead of the Fed‚Äôs interest rate decision and press conference. Only the Dow Jones witnessed bullish price movement during the US session.
  • Both Microsoft and Alphabet beat earnings and revenue expectations, but stocks declined. Find out why below.
  • The Euro rose in value against all currencies on Tuesday, but the region‚Äôs Gross Domestic Product continues to indicate stagnation and a risk of a recession.
  • The US Dollar Index trades higher but US Bond yields fall to weekly lows.
USA500

The SNP500 fell 0.33% during yesterday‚Äôs trading session and formed a 0.10% bearish gap during this morning‚Äôs Asian session. The price has since formed a price range which traders can use as a breakout level at $4,909.11 and $4,901.40. The decline in the index was largely triggered by the upcoming Federal Reserve Press Conference and ‚Äúprofit taking‚ÄĚ, according to analysts.

Overnight the market focused on the quarterly earnings reports from Microsoft and Alphabet. Microsoft is the most influential stock and holds a weight of 7.31%. Microsoft stocks fell by 0.28% before the announcement and a further 0.25% after the announcement. Volatility levels were relatively low and according to analysts, the upcoming Fed announcement may potentially be the reason why. In addition to this, Microsoft did not add anything particular to their forward guidance which disappointed investors.

Microsoft.png

Microsoft Earnings beat expectations by 5.80% and Revenue by 1.45%. In addition to this, investors are also cautious about the fact that growth is largely being witnessed in the Azure and cloud services. Whereas the other 7 sectors are seeing relatively lower growth. Bloomberg advises the company earnings are solid and do not indicate a need for a selloff or significant decline. However, neither do we have any indications of upward price movement.

Alphabet stocks on the other hand saw a larger decline after their earnings report was published. The earnings per share figure was 2.50% higher than expectations and revenue only 1%. Even though the earnings were higher than expectations, shareholders were still largely disappointed. The previous 4 quarters saw earnings beat between 7% and 10%. According to analysts, investors took this as an opportunity to cash in profits and so there was no need to hold onto positions for the time being.

Of the USA500’s most influential 10 stocks, only 2 ended the day higher and from the 50 most influential stocks 28 rose in value. Here we can see that the individual stocks and components are not giving a clear picture and most likely tonight’s Fed comments will determine the price movement over the next 24-48 hours.

Copy-of-TELEGRAM-MARKET-UPDATE-78-1024x577.png
 
EURUSD

The Euro saw moderate increases against all currencies during the European session but lost momentum once the US session opened. However, the price this morning is showing much stronger volatility in favor of the Dollar. In addition to this the US Dollar Index is rising in value during this morning’s Asian Session. So, are investors increasing their exposure to the Dollar ahead of tonight’s Federal Reserve decision, statement, and press conference? Traders will monitor if this will be the pattern for the day.

The Dollar is once again being supported by considerably stronger than expected economic data. JOLTS Job Openings rose from 8.93 million to 9.03 million, higher than the previous 2 months and higher than expectations. In addition to this the CB Consumer Confidence also rose to its highest level since December 2021. If the Federal Reserve Chairman, Jerome Powell, gives a more hawkish press conference compared to recent ones, the Dollar can indeed potentially rise further. For example, if the Fed advises the FOMC will not vote for rate cuts in the first 2 quarters for the year.

When monitoring technical analysis, the price of the exchange is below trend lines, in the sell zone of oscillators and trading below the regression channels. All factors currently indicate Dollar dominance.

Copy-of-TELEGRAM-MARKET-UPDATE-79-1024x577.png


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 1st February 2024.

Dollar Rises As Fed Confirms No Rate Cut At March’s Meeting.


eurusdlibra-696x364.png
  • The Federal Reserve Chairman advises journalists that interest rate cuts are not likely in March. However, bond yields continue to decline indicating institutions continue to believe cuts are impending.
  • The USA100 declines by 2.5% over two consecutive days after earnings data was unable to support individual stocks.
  • Futures market points lower in Europe and Asian stocks show no clear direction. Traders are considering if investors will take advantage of the lower price ahead of tonight‚Äôs vital earnings data.
  • Stock traders turn their attention to earnings from Apple, Amazon and Meta. The three stocks make up almost 18% of the NASDAQ.
EURUSD ‚Äď The US Dollar Rises Against All Currencies!

The EURUSD exchange saw one of the highest levels of volatility amongst the ‚Äúmajor currency pair‚ÄĚ category. The exchange rate saw two significant impulse waves which can be explained using fundamental factors. The first impulse wave was in favor of the Euro and was largely due to the German inflation data reading higher than expectations. The correction which followed in the US session was due to the Fed‚Äôs comments on future interest rates.

Copy-of-TELEGRAM-MARKET-UPDATE-80-1024x577.png

This morning the exchange rate trades 0.30% lower and continues to obtain sell signals against the Dollar. The US Dollar Index is trading at its highest level since early December 2023. The Euro on the other hand is not witnessing any significant price movements against other major competitors. The Euro upward price movement was generally weak against the Dollar as German inflation still fell despite the smaller decline and also French inflation fell by a considerable -0.2%.

The US Dollar saw some negative economic data for the first time in over two weeks in yesterday’s session. The ADP Non-Farm Employment Change read 41,000 lower than expectations and the Employment Cost Index for the quarter fell to its lowest level since July 2021. Nonetheless, the Federal Reserve confirmed in their press conference that a rate cut in March is not likely. According to analysts, the Fed will not likely cut at the March meeting unless employment data takes a serious hit. According to the CM Exchange, there is a 92% chance of a rate cut in May and a certain cut by June at the latest. The Fed did not give any indications that this is not possible and is being backed this morning by declining yields. The question is who will opt for larger and more frequent cuts, the Fed, the ECB or the Bank of England.
 
USA100 ‚Äď Will Investors Continue Profit Taking?

The USA100 saw a considerable downward price movement on Wednesday and order flow analysis indicates seller overpowering buy orders. In addition to this, the assets traded below the volume weighted average price throughout the whole day. Technical analysis and order flow indicate a decline in the asset; however, traders also need to consider if investors will look to re-enter at a lower price.

This will largely depend on tonight’s earnings data. Analysts expect Apple, Amazon, and Meta to witness significantly higher earnings as well as revenue. However, the question is whether the companies will beat expectations. Investors will also be closely monitoring reviews on the new Apple headset. These reviews and future sales figures can significantly affect Apple stocks which hold 8.78% of the NASDAQ. So far, reviews are positive in terms of the technology and experience, but negative in terms of the price and demand due to the high cost.

Copy-of-TELEGRAM-MARKET-UPDATE-81-1024x577.png
 
GBPJPY ‚Äď Investors Turn Their Attention to Bank of England Votes

The GBPJPY is decreasing in value for its fourth consecutive day and is trading at its lowest level since January 16th. Throughout the year the Japanese Yen is expected to perform well due to being the only Central Bank which will not be cutting interest rates. However, in the short-term, the price action will depend on this afternoon‚Äôs Bank of England Press conference and ‚ÄúCommittee Votes‚ÄĚ.

The rate decision is without a doubt not going to change this month, however, the change in votes can create volatility. Analysts expect 2 members of the committee to vote for another interest rate increase, which is lower than last month’s 3 votes. If the votes are more hawkish than expectations, the Pound can rise. Whereas less votes for rate increases or a vote for a decrease would significantly pressure the Pound.

Copy-of-TELEGRAM-MARKET-UPDATE-82-1024x577.png

Technical analysis signals a downward trend when evaluating momentum and trend-based indications. However, the price has fallen to the previous resistance level which can be flipped to a support.

Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

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Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 2nd February 2024.

The S&P500 Renews Its All-Time-Highs. Investors Turn to Upcoming US Data.


NFP-1-696x364.jpg
  • Investors take advantage of the lower purchasing price amongst technology company stocks. The NASDAQ recovers and trades closer to previous highs.
  • Apple, Amazon, and Meta earnings beat Wall Street‚Äôs expectations. Apple falls 2.92%, Amazon rises 7.11% and Meta trades more than 15% higher.
  • Apple revenue rises for the first time in over 12-months. Nonetheless, investors still sold shares as the company confirmed they are encountering difficulty in China, one of their largest markets. China previously has accounted for up to 25% of Apple‚Äôs revenue.
  • Analysts expect the US Unemployment Rate to rise from 3.7% to 3.8% and for the NFP Employment Change to read 188,000.
USA500 ‚ÄstEarnings Push the USA500 to All-Time Highs

The USA500 was the best performing index on Thursday increasing in value by 1.25% and rising to a new all-time high. Technical analysis currently continues to indicate upward price movement. The asset trades above moving averages, above the Volume Weighted Average Price and oscillators continue to indicate buyers are controlling the market. The only concern for investors is the previous resistance level and if demand will decline at such a high price.

Copy-of-TELEGRAM-MARKET-UPDATE-83-1024x577.png

The price this morning trades within a price range between $4,937.90 and $4,928.87. If the price breaks above this level the assets’ buy signals can potentially strengthen. The upward price movement is supported by company earnings data. Apple, Amazon and Meta easily beat earnings and revenue data. Apple was the only stock which saw a decline after earnings due to negative data from China, its second most important market. Meta and Amazon on the other hand saw a significant rise in demand.

The Unemployment Rate is expected to increase from 3.7% to 3.8% and the Average Hourly Earnings to decrease from 0.4% to 0.3%. The Nonfarm Payrolls may also decrease from 216,000 to 188,000. According to analysts, the ideal release would be slightly weaker figures but not weak enough to indicate harsher economic conditions. Though weaker data can prompt the Fed to consider a rate cut earlier. However, higher and stronger employment data can temporarily pressure the stock market as it supports rates remaining higher for longer.

Important earnings reports will continue today and on Monday for the USA500. This morning ExxonMobil and Chevron will announce their earnings. Over the past month, neither stock has seen any significant bullish price movement. On Monday, McDonald’s and Caterpillar will announce their earnings. Both stocks are trading slightly higher in 2024.
 
GBPUSD ‚Äď Bank of England Member Votes for Rate Cut!

The price of the British Pound rose in value against the currency market as a whole and the US Dollar Index moderately fell. During yesterday’s session the Cable rose 0.46% and is also trading higher this morning. However, investors should be cautious of upward price movements as the Bank of England were deemed to be more dovish than their global partners.

The Bank of England has a Monetary Policy Committee made up of 9 members. None of the nine members have ever voted for a rate cut in the past 4 years, until now. Only 2 members of the committee voted for a hike, which is lower than previous months. 6 voted for a pause and 1 voted for a rate cut. Additionally, the Governor of the central bank also said the regulator would consider a rate cut later in the year.

Lastly, investors will have their attention fixed on this afternoon’s upcoming economic releases across the Atlantic. If the US employment data and Consumer Sentiment read stronger than expectations, the Dollar can potentially attempt a correction.

Copy-of-TELEGRAM-MARKET-UPDATE-84-1024x577.png


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 5th February 2024.

Market Recap ‚Äď Dollar shines;Gold in free fall as US consistently defies recession fears.


Copy-of-TELEGRAM-4-1-696x392.png
Economic Indicators & Central Banks:
 
  • An eyepopping¬†January jobs report¬†capped off a huge week of events that ended with fresh record highs on Wall Street ‚ÄstFOMC indicated it was done with tightening.
  • Dollar¬†up¬†as any hopes for a March rate cut were wiped out. Meanwhile, further evidence of the robust economy added to the growing optimism for 2024 after 2023 ended on a high note.
  • The¬†China Securities Regulatory Commission¬†has announced its commitment to intensifying the enforcement of measures targeting offenses like market manipulation and malicious short selling. Simultaneously, it aims to direct a greater influx of medium and long-term funds into the market.
  • Market sentiment¬†was also negatively impacted by remarks from former President¬†Donald Trump, who suggested the possibility of imposing tariffs exceeding 60% on imports of Chinese goods if he were to be re-elected.
  • German trade surplus widened, but exports plunged ‚ÄstGermany‚Äôs export oriented model is struggling with geopolitical tensions.
Market Trends:
 
  • Treasuries¬†fell, extending Friday‚Äôs selloff.
  • Massive earnings beats from Meta (20%)¬†and¬†Amazon (+7.87%)¬†saw the US major Indices surging by more than 1%, while¬†Nvidia¬†closed 4.74% higher.
  • Asian stocks¬†were mostly lower as Chinese shares extended declines despite a series of stimulus measures and the securities regulator‚Äôs latest pledge to shore up the market. ‚Äď the FED, China‚Äôs property sector & tepid investor sentiment are all pressuring the Chinese equity market.
  • European¬†futures are also narrowly mixed, while US futures are posting broad losses.
  • Today: January PMI data for France, Germany, UK & Eurozone and US ISM Services.
Financial Markets Performance:
 
  • The¬†USDIndex¬†held gains, just a breath below¬†104, while EURUSD¬†drifted below¬†1.0800. GBPUSD¬†held in December‚Äôs range.
  • The¬†Yen¬†crept lower to trade above¬†$148.
  • USOIL¬†steadies above¬†$72¬†as the US vowed more strikes against Iran‚Äôs forces while the Houthis promised to retaliate against bombardments over the weekend.
  • Gold¬†weakened!
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 6th February 2024.

Market Recap ‚Äď Stocks surge as hopes of rate cuts recede; USD, yields higher.


RBA-AUD-696x364.png
Economic Indicators & Central Banks:
 
  • Treasury yields elevated and US government bonds¬†remained in a selloff after Fed Chair Powell pointed to fewer interest rate cuts this year than markets had been projecting.
  • Strong ISM services index added to the¬†selloff for Treasuries, as did the concession building ahead of this week‚Äôs $121 bln¬†Treasuries auction.
  • RBA left its cash rate unchanged at 4.35% ‚Äst12-year high. Surprisingly the statement indicated that ‚Äúa further increase in interest rates cannot be ruled out,‚ÄĚ hence leaving a hawkish bias in place. ‚Äď possibly this is more prudence and a cautious move in order to keep rate cut expectations from building. Forecasts show inflation will not be coming into the 2% to 3% target range until 2025, hence the hawkish slant, and will not hit the midpoint until 2026.
  • BOE‚Äôs¬†Huw Pill said that he did not need to see underlying inflation actually hit the 2% target to begin lowering rates.
  • UK retail sales¬†slowed in January.
  • An unexpected jump in German manufacturing orders at the start of the European session reduced the pressure on the ECB to cut rates.¬†German manufacturing orders unexpectedly jumped 8.9% y/y. This was the strongest bounce since June 2020 ‚Äď glimmers of hope but overall demand subdued!
Market Trends:
 
  • Chinese stocks rose¬†after the announcement that China‚Äôs securities regulator will meet President Xi Jinping.
  • Equities declined in¬†Japan, Australia and South Korea. Topix¬†fell 0.8% in the early trade ahead of earnings releases from¬†Toyota¬†Motor and¬†Mitsubishi¬†Corporation.¬†JPN225 (Nikkei)¬†fell 0.5%.
  • US and European futures¬†contracts showed modest gains this morning, extending the positive lead in Asia.
  • UBS Group AG¬†said it will resume share buybacks this year, vowing to hand as much as $1 billion to shareholders in the second half.
Copy-of-TELEGRAM-5.png

Financial Markets Performance:
 
  • The¬†USDIndex¬†rallied on the less dovish Fed outlook, rising to test¬†104.60¬†before dipping back to¬†104.15 today.
  • The¬†AUDUSD¬†rallied to¬†0.6520¬†as Aussie bond yields jumped with the benchmark rising over 7 bps to 4.166.
  • USOIL¬†recovered modestly from its better than -7% plunge last week, rising to¬†$73.28¬†per barrel before drifting down to¬†$72.98.
  • Gold¬†fell to an overnight nadir of¬†$2014.95¬†per ounce thanks in part to the rise in bond yields, but inched up to finish at¬†$2026.30,¬†the weakest since January 26.
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 7th February 2024.

Market Recap ‚Äď Cautious Start!


daily-market-update-696x364.png
Economic Indicators & Central Banks:
 
  • Treasuries¬†bounced back after the¬†worst 2-day stretch since June 2022. Dip buying¬†supported along with a¬†solid 3-year note auction¬†& comments from the more hawkish Fed President¬†Mester¬†who could see rate cuts later in the year.
  • China‚Äôs bourses¬†initially rallied on stimulus hopes, but the pledge to do more and the attempt to fix the situation with a series of smaller changes hasn‚Äôt instilled lasting confidence.¬†Stimulus hopes are priced in already and gains could fade,¬†if there is no more decisive follow up.
  • This year‚Äôs near¬†-9% plunge in the Shanghai Composite index¬†to the lowest since 2019,¬†and the better than ‚Äď10% drop in the Hang Seng, have rattled the officials significantly, especially as the various measures to date, including curbs on short selling, along with rate cuts and liquidity injections by the PBoC have failed to provide much umph.
  • German industrial production¬†corrected -1.6% m/m in December. A worse than expected result.
Market Trends:
 
  • The¬†CSI 300¬†is still up 0.96%, but the¬†Hang Seng¬†is now down -0.2% on the day.
  • The¬†Dow¬†advanced 0.37%, with the¬†S&P 500¬†0.23% higher, and the¬†NASDAQ¬†up 0.07%.
  • European and US futures are flat!
Copy-of-TELEGRAM-6.png

Financial Markets Performance:
 
  • The¬†USDIndex¬†was firmer but off its best levels as the gain to a¬†104.604¬†intraday high elicited some profit taking as the markets weigh central bank policies.
  • The¬†NZDUSD spiked to 0.6113,¬†as government bond yields rose after the strong New Zealand jobs report, which indicated that the¬†RBNZ¬†could remain cautious about cutting interest rates. The Aussie Dollar strengthened as well.
  • USOIL¬†prices are firmer at $73.42 per barrel.¬†Gold¬†is 0.53% higher at $2035.66 per ounce.
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 8th February 2024.

Market Recap ‚Äď S&P500 Breaks 5k; Gold & USD in a range!


eu_update_pic_nov18-1-696x391.jpg
Economic Indicators & Central Banks:
 
  • Asian stock markets¬†were mixed with mainland¬†Chinese stocks¬†swinging between gains and losses on the eve of the Lunar New Year holidays, while¬†Treasuries stabilized.
  • China CPI tumbled to an -0.8% y/y pace in January, steeper than forecast, after falling at a -0.3% y/y clip in December. It is the fastest pace of decline since September 2009 and a fourth straight month in deflation.
  • Japanese¬†bourses outperformed,after BoJ‚Äôs Uchida said it is¬†hard to see a rapid lift-off in rates.
  • Treasuries¬†bounced back after the¬†worst 2-day¬†stretch since June 2022.
  • Dovish Fed‚Äôs Kashkari currently sees two to three rate cuts would be appropriate¬†this year, as things stand.
Market Trends:
 
  • The¬†Nikkei¬†rallied 2.1%, mainland China bourses and the Hang Seng corrected again.
  • European and US futures are higher¬†despite a slight rise in yields.
  • The¬†S&P 500¬†hit a new high at the close,¬†breaking the 5,000 level¬†, driven by confidence in the economy despite worries like Fed policy changes and market conditions. The market remains strong with good momentum, even in a slower season.
  • Ford Motor, Chipotle Mexican Grill and other big stocks climbed following their latest earnings reports.
Copy-of-TELEGRAM-7.png

Financial Markets Performance:
 
  • The¬†USDIndex¬†is at¬†104.03,¬†in a tight range as markets digest mixed Fed speeches and ahead of more economic data.
  • The¬†USDJPY¬†depreciated against the US Dollar, reaching 148.80, following comments from BoJ Deputy Governor Shinichi Uchida indicating that the central bank is unlikely to pursue aggressive interest rate hikes, even as it moves away from negative interest rates.
  • USOIL¬†rose for the 3rd day in a row, above¬†$74,¬†driven by gains in financial markets and ongoing tensions in the Middle East. The rise in global stocks is boosting demand for oil, despite the Federal Reserve‚Äôs dismissal of immediate interest rate cuts.
  • Gold¬†steady at¬†$2030-2038.
  • Bitcoin¬†rose 0.85% to¬†$44,564.62.
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 9th February 2024.

Market Recap ‚Äď Yen, Oil & Bitcoin Hit Key Resistance Levels Ahead of US Inflation Week.


yen_1200x628-696x364.png
Economic Indicators & Central Banks:
 
  • Markets are closed¬†for the holiday in mainland China, Taiwan, South Korea, Indonesia, the Philippines and Vietnam.
  • Treasuries¬†declined for a 2nd straight session &¬†Wall Street closed with small gains,¬†as the market continues to shed expectations on¬†Fed rate cuts ahead. The catalyst for selloff was the declines in initial and continuing jobless claims, reversing some of the recent increases and indicating the¬†job market remain solid.
  • Nikkei (JPN225)¬†saw an uptick at Friday‚Äôs close, pulling back from a 34-year peak as investors are in a profit taking mode in this 3rd week of gains. It edged up by 0.09% to 36,897.42 after surging as high as 1.15% to 37,282.26, marking its¬†highest level since February 1990.
  • German HICP inflation was confirmed at 3.1% y/y¬†in the final reading for January. Inflation is still far above the ECB‚Äôs target, but on a clear downtrend, and for the doves at the ECB that is enough to start weighing rate cuts.
Market Trends:
 
  • European futures declined¬†cautiously ahead of US inflation data, while Asia geared down for the Lunar New Year holiday.
  • Australian equities¬†remained relatively stable, while¬†Japanese stocks¬†displayed mixed performance, partially supported by¬†a weaker yen.
  • The¬†Nikkei¬†rallied 2.1%, mainland China bourses and the Hang Seng corrected again.
  • SoftBank¬†Group surged by¬†8.72%,¬†extending its upward trajectory for a 2nd day following the tech investment firm‚Äôs return to profitability after 5 quarters. The rally in SoftBank Group Corp. shares was propelled by a¬†more-than-55% surge in Arm Holdings (Arm chip design unit),¬†in which¬†SoftBank holds a 90% stake, after the British tech company forecasted quarterly sales and profit surpassing Wall Street expectations.
  • Nissan¬†plummeted by 12% after the company failed to meet profit estimates.
Copy-of-TELEGRAM-8.png

Financial Markets Performance:
 
  • The¬†USDIndex¬†remained steady ahead of the annual revisions to monthly US inflation data, following last year‚Äôs revisions that raised doubts about the Federal Reserve‚Äôs progress in managing consumer prices.
  • The¬†Yen¬†stabilized after a 0.8% decline against the USD on Thursday, triggered by comments from a BoJ deputy governor hinting at the central bank‚Äôs continued accommodative policy stance. The¬†USDJPY¬†broke¬†149¬†and extended to¬†149.49.
  • NZDUSD¬†climbed to¬†0.6133¬†along with New Zealand yields following ANZ Bank New Zealand Ltd.‚Äôs forecast of¬†2 more interest rate hikes by the¬†RBNZ¬†this year.
  • USOIL¬†broke¬†$76,¬†eyes on¬†$80¬†resistance level.
  • Bitcoin¬†spiked to¬†1-month high¬†above¬†$46,000,¬†with historical data indicating positive returns¬†post-Lunar New Year holidays, averaging over 10% in 10-day returns since 2014.
  • Ether, Solana¬†and¬†Cardano¬†also pushed upward.
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 15th February 2024.

Inflation Expectations Were Too Optimistic. Investors Consider More Buys.


inflation_1200x628_2-696x364.png
  • UK inflation unexpectedly remains at 4.0% and Core Inflation data also read lower than expectations causing the Pound to decline.
  • US inflation declines but at a weaker pace compared to expectations. US inflation falls from 3.4% to 3.1% (previously expectations were for inflation to fall to 2.9%).
  • The best performing currency as we edge towards the European Cash Open is the Australian Dollar, followed by the Japanese Yen.
  • The NASDAQ witnesses its largest daily decline in February due to the inflation rate pushing back hopes of an early rate cut.
USA100 ‚Äď Core Inflation a Concern for the Fed and Investors!

After the release of January‚Äôs inflation rate and core inflation data, the USA100 as well as all US indices fell rapidly. When evaluating each component within the NASDAQ, only 6% of the index were able to hold onto their value. All stocks which held more than a 0.50% weight in the index depreciated. The reason for the decline was not that the inflation rate is ‚Äútoo high‚ÄĚ or that interest rates cuts are not likely. Instead, the decline is due to investors now believing a cut in March is indeed not possible.

According to analysts, the inflation rate does not indicate any danger to the US economy, nor does it indicate there is any reason for a large lasting decline in US stocks. However, the news can weaken demand in the short term. Again, economists advised the inflation rate is not high, but simply higher than the over-optimistic expectations, and that cuts are still likely in the second quarter of 2024.

The short-term price condition of the index will largely depend on upcoming earnings reports from Cisco and Applied Materials. The two stocks make up 2.70% of the index and if these earnings read higher than expectations, it can reassure investors amid concerns. Cisco has beat earnings per share expectations consecutively over the past 12 months as has Applied Materials.

Investors’ main concern yesterday was the Core Inflation data which continues to prove difficult to tackle. Core inflation does not include products related to food and the energy sector. The monthly Core Inflation Data read 0.4%, the highest since May 2023. But slightly easing concerns is inflation elsewhere falling; the UK inflation remains at 4.0%, Chinese inflation fell as did Swiss inflation. The Producer Price Index will now be vital for investors. If the PPI reads higher than expectations, investors’ concerns could grow and the USA100 could form a correction instead of a smaller retracement.

On the daily chart, a retracement would mean a further decline between 1.89% to 4.40%, whereas a full correction would mean a 6.30%-8.00% decline. Currently the two-hour chart indicates an upward price movement towards the 75-bar exponential moving average. However, investors should note this will largely depend on earnings data, the US Retail Sales and Friday’s PPI release.

Copy-of-TELEGRAM-MARKET-UPDATE-99-1024x577.png

GBPUSD ‚Äď The Pound Gives up Gains after Lower Inflation Data

The exchange rate continues to trade below major trendlines for a second day after stronger US inflation and weaker UK inflation. The possibility of the Bank of England opting for a rate cut first, or within the same month as the Federal Reserve grows. However, this will depend on upcoming data from the UK over the next 48-Hours.

The UK is scheduled to release their Monthly GDP and Retail Sales on Friday. If both read lower than expectations, the possibility of an earlier rate cut by the Bank of England rises. The UK’s Gross Domestic Product is believed to have declined by 0.2%, which would be the third decline in 6-months.

Technical analysis also indicates a downward trend. The price of the exchange trades below the 75-bar EMA and below the neutral on the RSI. On the 5 and 15-minute timeframes, the asset is also forming downward crossovers. These three factors indicate further bearish price movement and the Fibonacci indicates the price can fall down to 1.24990.

Copy-of-TELEGRAM-MARKET-UPDATE-98-1024x577.png


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

Please note that times displayed based on local time zone and are from time of writing this report.


Click HERE to access the full HFM Economic calendar.

Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE!

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

Disclaimer:
 This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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