GOLD STRONG BUY , short term correction coming soon
#Gold STRONG BUY
100% Buy with a Strongest short term outlook on maintaining the current direction.
Long term indicators fully support a continuation of the trend.
The market is approaching overbought territory. Be watchful of a trend reversal.
The dollar index (DXY00) on Friday fell by -0.16%. The dollar on Friday gave up an early advance and posted moderate losses. A sharp rally in stocks Friday curbed liquidity demand for the dollar. Also, strength in GBP/USD Friday weighed on the dollar after the British pound rallied to an 11-month high. The dollar Friday initially moved higher as the better-than-expected U.S. Apr payroll report may prompt the Fed to keep interest rates higher for longer.
For long-term analysis and investment purposes I like to use cash indexes as it takes futures spreads and rolling out of the equation. The monthly chart of the cash index (GCY00) I track for gold is showing an interesting pattern, hitting a high of $2,070.48 during August 2020 then another high of $2,065.89 during March 2022 .If we consider this a double-top, then the break below the interim low $1,677.64 from March 2021 completed the bearish pattern indicating the long-term trend has turned down. However, this doesn’t fit the narrative of expected lower interest rates, stronger Treasuries, and a weaker US dollar. That puts the spotlight on the latest rally that had the index posting an early May high of $2,059.31, within sight of its previous marks.
100% Buy with a Strongest short term outlook on maintaining the current direction.
Long term indicators fully support a continuation of the trend.
The market is approaching overbought territory. Be watchful of a trend reversal.
The dollar index (DXY00) on Friday fell by -0.16%. The dollar on Friday gave up an early advance and posted moderate losses. A sharp rally in stocks Friday curbed liquidity demand for the dollar. Also, strength in GBP/USD Friday weighed on the dollar after the British pound rallied to an 11-month high. The dollar Friday initially moved higher as the better-than-expected U.S. Apr payroll report may prompt the Fed to keep interest rates higher for longer.
For long-term analysis and investment purposes I like to use cash indexes as it takes futures spreads and rolling out of the equation. The monthly chart of the cash index (GCY00) I track for gold is showing an interesting pattern, hitting a high of $2,070.48 during August 2020 then another high of $2,065.89 during March 2022 .If we consider this a double-top, then the break below the interim low $1,677.64 from March 2021 completed the bearish pattern indicating the long-term trend has turned down. However, this doesn’t fit the narrative of expected lower interest rates, stronger Treasuries, and a weaker US dollar. That puts the spotlight on the latest rally that had the index posting an early May high of $2,059.31, within sight of its previous marks.
Comment:
Week Ahead: US CPI Report May Rock These 3 Markets
Even as anticipation mounts ahead of the US jobs data due later today, investors may be bracing for more volatility in the week ahead thanks to another round of risk events.
Economic Calendar for Next Week
All eyes will be on the incoming US inflation data as well as speeches from financial heavyweights and other risk events which could spark some fresh action across markets.
Monday, May 8
UK bank holiday honouring Charles III coronation
EUR: Germany industrial production, ECB Chief Economist Philip Lane speech
Tuesday, May 9
CHN: China trade, money supply
AUD: Australia consumer confidence
EUR: ECB Chief Economic Philip Lane speech (IMF)
USD: Fed New York President John Williams speech
US President Joe Biden debt ceiling talks
Wednesday, May 10
EUR: Germany April CPI (final)
USD: US April CPI
Thursday, May 11
CNH: China PPI, CPI
GBP: UK BOE rate decision & press conference
USD: US PPI, initial jobless claims
G7 finance ministers meet in Japan
Friday, May 12
GBP: UK Industrial production, Bank of England Chief Economist Huw Pill speech
USD: University of Michigan consumer sentiment, Fed speeches
The April US consumer price index (CPI) report published on Wednesday 10th May will be exactly one week after the Federal Reserve raised rates and signalled a pause in further increases.
Given how Fed Chair Jerome Powell has left the door open to further tightening if incoming economic data warrants, this could add more spice to the report.
CPI Forecasts
Markets are forecasting:
CPI year-on-year (April 2023 vs. April 2022) to remain steady at 5.0%.
Core CPI year-on-year to cool 5.4% from the 5.6% in the prior month.
CPI month-on-month (April 2023 vs March 2023) to rise 0.4% from 0.1% in the prior month.
Core CPI month-on-month to cool 0.3% from the 0.4% in the prior month.
Ultimately, further evidence of inflation slowing down could reinforce expectations around the Federal Reserve pausing and eventually cutting interest rates. Should inflation remain sticky, this could rekindle bets around the Fed leaving interest rates higher for longer.
Expectations are rising over the Federal Reserve cutting interest rates with the chance of a 25-basis point cut in July currently priced at 53%, according to Fed funds futures! It will be interesting to see how the incoming inflation data shapes market expectations around the central bank’s next move.
How Might the Markets React to the CPI Report?
With all of the above discussed, here’s how these 3 assets could react to the US CPI report
USD Index
The past few months have been rough and rocky for the dollar as investors weighed the prospects of the Federal Reserve pausing and then eventually cutting interest rates. More pain could be in store for the dollar if US inflation cools more than expected in April.
A soft inflation print may drag the USD Index toward the 100.72 level. Should prices experience a bearish breakout, this could open the doors toward 100.
A sticky inflation print could throw a lifeline to dollar bulls, propelling back above 101.50 with 102.34 acting as a key level of interest.
SPX500_m
After being trapped within a range for the past few weeks, could a breakout be on the horizon for the SPX500_m?
If the inflation numbers beat expectations, this may trigger a bearish breakout on the SPX500_m – taking prices below the 4050-support level.
Should the inflation numbers come in lower than market forecasts, SPX500_m bulls could be injected with renewed confidence as expectations intensify over the Fed ending its rate cycle. This could send the index back toward the 4180 resistance level and beyond.
Gold
It may be wise to fasten your seatbelts for potential volatility on gold due to its high sensitivity to inflation data and US interest rate expectations. The precious metal remains bullish on the daily charts despite prices pulling back from near-record highs.
A soft inflation report could sweeten appetite for the zero-yielding asset as bets rise over the Fed cutting rates in 2023. This development could push the metal back towards the 2023 high of $2063 with bulls eyeing $2070 and the all-time high at $2075.
A stronger-than-expected inflation number could drag gold prices back toward the psychological $2000 level.
Even as anticipation mounts ahead of the US jobs data due later today, investors may be bracing for more volatility in the week ahead thanks to another round of risk events.
Economic Calendar for Next Week
All eyes will be on the incoming US inflation data as well as speeches from financial heavyweights and other risk events which could spark some fresh action across markets.
Monday, May 8
UK bank holiday honouring Charles III coronation
EUR: Germany industrial production, ECB Chief Economist Philip Lane speech
Tuesday, May 9
CHN: China trade, money supply
AUD: Australia consumer confidence
EUR: ECB Chief Economic Philip Lane speech (IMF)
USD: Fed New York President John Williams speech
US President Joe Biden debt ceiling talks
Wednesday, May 10
EUR: Germany April CPI (final)
USD: US April CPI
Thursday, May 11
CNH: China PPI, CPI
GBP: UK BOE rate decision & press conference
USD: US PPI, initial jobless claims
G7 finance ministers meet in Japan
Friday, May 12
GBP: UK Industrial production, Bank of England Chief Economist Huw Pill speech
USD: University of Michigan consumer sentiment, Fed speeches
The April US consumer price index (CPI) report published on Wednesday 10th May will be exactly one week after the Federal Reserve raised rates and signalled a pause in further increases.
Given how Fed Chair Jerome Powell has left the door open to further tightening if incoming economic data warrants, this could add more spice to the report.
CPI Forecasts
Markets are forecasting:
CPI year-on-year (April 2023 vs. April 2022) to remain steady at 5.0%.
Core CPI year-on-year to cool 5.4% from the 5.6% in the prior month.
CPI month-on-month (April 2023 vs March 2023) to rise 0.4% from 0.1% in the prior month.
Core CPI month-on-month to cool 0.3% from the 0.4% in the prior month.
Ultimately, further evidence of inflation slowing down could reinforce expectations around the Federal Reserve pausing and eventually cutting interest rates. Should inflation remain sticky, this could rekindle bets around the Fed leaving interest rates higher for longer.
Expectations are rising over the Federal Reserve cutting interest rates with the chance of a 25-basis point cut in July currently priced at 53%, according to Fed funds futures! It will be interesting to see how the incoming inflation data shapes market expectations around the central bank’s next move.
How Might the Markets React to the CPI Report?
With all of the above discussed, here’s how these 3 assets could react to the US CPI report
USD Index
The past few months have been rough and rocky for the dollar as investors weighed the prospects of the Federal Reserve pausing and then eventually cutting interest rates. More pain could be in store for the dollar if US inflation cools more than expected in April.
A soft inflation print may drag the USD Index toward the 100.72 level. Should prices experience a bearish breakout, this could open the doors toward 100.
A sticky inflation print could throw a lifeline to dollar bulls, propelling back above 101.50 with 102.34 acting as a key level of interest.
SPX500_m
After being trapped within a range for the past few weeks, could a breakout be on the horizon for the SPX500_m?
If the inflation numbers beat expectations, this may trigger a bearish breakout on the SPX500_m – taking prices below the 4050-support level.
Should the inflation numbers come in lower than market forecasts, SPX500_m bulls could be injected with renewed confidence as expectations intensify over the Fed ending its rate cycle. This could send the index back toward the 4180 resistance level and beyond.
Gold
It may be wise to fasten your seatbelts for potential volatility on gold due to its high sensitivity to inflation data and US interest rate expectations. The precious metal remains bullish on the daily charts despite prices pulling back from near-record highs.
A soft inflation report could sweeten appetite for the zero-yielding asset as bets rise over the Fed cutting rates in 2023. This development could push the metal back towards the 2023 high of $2063 with bulls eyeing $2070 and the all-time high at $2075.
A stronger-than-expected inflation number could drag gold prices back toward the psychological $2000 level.
Comment:
Gold reached its target for the completion of an AB=CD pattern yesterday and has since moved into a retracement. So far, the pullback tested support of the 21-Day EMA line today, with a low for the day at 1,999. Price was rejected from the line to the upside for an intraday bounce. The dip also completed a 78.6% Fibonacci retracement of the near-term upswing. This could be the end of the correction. Nevertheless, lower key support is around the uptrend line, estimated at 1,994 currently, and the 34-Day EMA at 1,985.
Comment:
Traders Take Profits After Report Reveals Strong US Job Growth
Technically speaking gold traded through a series of lower highs and strong support at $1980.
Market participants used the jobs report to actively engage in U.S. equities taking all three major indices higher. The Dow Jones industrial average gained 1.65%. The Standard & Poor’s 500 gained 1.85%, and the NASDAQ composite gained 2.25% in active trading today.
Gold Prices Drop as Investors Take Profit Despite Strong Fundamentals
Gold investors and traders also used this report as a reason to pull profits from recent gains in gold which had roughly a $100 trading range from Tuesday’s open at $1990 to yesterday’s high of $2083. Before the upside breakout in gold which occurred on Tuesday, May 2 gold pricing was contained in a narrow trading range between $1980 and $2020.
Technically speaking gold traded through a series of lower highs and strong support at $1980. This created an asymmetrical triangle pattern composed of a descending top and a flat bottom. Typically, this type of asymmetrical triangle occurs during a price correction and once pricing reaches the apex of the triangle market technicians look for a break to lower pricing. In rare instances, this pattern can be found during an uptrend as witnessed this week in gold.
Considering that the major fundamental factors that have moved gold substantially higher are still unresolved and worrisome today’s strong decline in gold prices could present an opportunity to buy the dip. There is still common ground that both Democrats and Republicans can sign off on as we get closer and closer to the date at which the government can no longer meet its obligations. Whether or not there are more midsize regional banks that could become insolvent is unknown. Combined these issues could certainly continue to be highly supportive of gold prices moving them higher.
However, gold enthusiasts got a reprieve today as gold futures dropped $30.80 or 1.5% with the most active June 2023 Comex contract currently fixed at $2024.90.
Technically speaking gold traded through a series of lower highs and strong support at $1980.
Market participants used the jobs report to actively engage in U.S. equities taking all three major indices higher. The Dow Jones industrial average gained 1.65%. The Standard & Poor’s 500 gained 1.85%, and the NASDAQ composite gained 2.25% in active trading today.
Gold Prices Drop as Investors Take Profit Despite Strong Fundamentals
Gold investors and traders also used this report as a reason to pull profits from recent gains in gold which had roughly a $100 trading range from Tuesday’s open at $1990 to yesterday’s high of $2083. Before the upside breakout in gold which occurred on Tuesday, May 2 gold pricing was contained in a narrow trading range between $1980 and $2020.
Technically speaking gold traded through a series of lower highs and strong support at $1980. This created an asymmetrical triangle pattern composed of a descending top and a flat bottom. Typically, this type of asymmetrical triangle occurs during a price correction and once pricing reaches the apex of the triangle market technicians look for a break to lower pricing. In rare instances, this pattern can be found during an uptrend as witnessed this week in gold.
Considering that the major fundamental factors that have moved gold substantially higher are still unresolved and worrisome today’s strong decline in gold prices could present an opportunity to buy the dip. There is still common ground that both Democrats and Republicans can sign off on as we get closer and closer to the date at which the government can no longer meet its obligations. Whether or not there are more midsize regional banks that could become insolvent is unknown. Combined these issues could certainly continue to be highly supportive of gold prices moving them higher.
However, gold enthusiasts got a reprieve today as gold futures dropped $30.80 or 1.5% with the most active June 2023 Comex contract currently fixed at $2024.90.
Comment:
The US Week Ahead
The US CPI Report will impact the EUR/USD on Wednesday. Following the US Jobs Report, a hotter-than-expected US CPI Report would refuel bets on a June Fed interest rate hike.
On Thursday, wholesale inflation and jobless claims figures will also draw interest before consumer sentiment numbers on Friday.
Investors should track FOMC member reactions to the US Jobs Report and the incoming US CPI Report.
According to the CME FedWatch Tool, the probability of a 25-basis point June interest rate hike rose from 0.0% to 8.5%. On Friday, the US Jobs Report drove the modest rise. However, the US Jobs Report wiped out bets on a June Fed interest rate cut.
The US CPI Report will impact the EUR/USD on Wednesday. Following the US Jobs Report, a hotter-than-expected US CPI Report would refuel bets on a June Fed interest rate hike.
On Thursday, wholesale inflation and jobless claims figures will also draw interest before consumer sentiment numbers on Friday.
Investors should track FOMC member reactions to the US Jobs Report and the incoming US CPI Report.
According to the CME FedWatch Tool, the probability of a 25-basis point June interest rate hike rose from 0.0% to 8.5%. On Friday, the US Jobs Report drove the modest rise. However, the US Jobs Report wiped out bets on a June Fed interest rate cut.
Comment:
Short Rising Trend Lines Cross Up Around 2,109
Going forward, keep an eye on the two short rising trend lines that cross up around 2,109, to see if gold stays within the parameters of the rising wedge type pattern. There is also the ascending parallel trend channel present as well.
Going forward, keep an eye on the two short rising trend lines that cross up around 2,109, to see if gold stays within the parameters of the rising wedge type pattern. There is also the ascending parallel trend channel present as well.
Comment:
An Expected Rates Hike
Powell’s 0.25% hike was expected, so when it became a reality, markets didn’t really react. But what changed was the narrative regarding the future price moves. Powell said that they will make further decisions based on the data that they get. So, Powell is no longer saying about further increases but about being data-dependent. The latter is irrelevant because the Fed is always data-dependent, at least in theory (theory says that there are no political influences on the Fed, too…). The former, however, means that the pause is on the table.
That’s what was said.
What does it mean? It means that if the inflation isn’t lower, they will have to raise rates again. Why? Because inflation is political – simple as that. That’s the thing that voters are most concerned with, and that’s a fact.
If the inflation does move lower, they will probably not be raising rates again.
Also, Powell added that he doesn’t plan to cut rates anytime soon.
“Inflation going to come down not so quickly,” he said, yesterday. “It will take some time. And in that world, if that forecast is broadly right, it would not be appropriate to cut rates.”
So, to summarize what’s likely to happen: the rates are either moving higher if the inflation doesn’t decline or the rates are staying where they are if inflation declines visibly.
In both cases, real interest rates (nominal rates minus expected inflation) are going to increase. So, both outcomes presented by Powell are bearish for gold and the rest of the precious metals sector.
People expect that it’s practically certain that the rates will stay as they are on the next Fed meeting and that they will then start to decline. In other words, the market participants think that the rates are going to decline within the next couple of months, but not necessarily in June.
Please note the contrast between the current expectations and what I wrote above as the scenarios that Powell pretty much revealed.
For a long time, we’ve been emphasizing that inflation is much stickier than many expect, so it’s much more likely that what Powell is saying about the rates and the outlook for them is much more realistic than what the market largely expects right now.
We’re probably in the “return to “normal”” part right now, and the most recent upswing was a bull trap. The “New Paradigm” top was likely the moment when many thought that interest rates could be kept very low for decades and during the crypto peak.
Even the name makes perfect sense in light of yesterday’s news and the current expectations. The “return to normal” in this case, means a return to “normally” low interest rates.
So, what does that all imply? That the market is likely to be surprised – negatively so. It’s obvious also from the technical point of view, and I’ve been writing about the bearish stock price forecast for quite a long time now.
Stocks just failed to move to new 2023 highs. They got close but declined shortly thereafter. It looks like we’re going to get the right shoulder of the head-and-shoulder top formation completed in the following weeks.
Commodities like crude oil and copper are already declining, and so do their producers.
Powell’s 0.25% hike was expected, so when it became a reality, markets didn’t really react. But what changed was the narrative regarding the future price moves. Powell said that they will make further decisions based on the data that they get. So, Powell is no longer saying about further increases but about being data-dependent. The latter is irrelevant because the Fed is always data-dependent, at least in theory (theory says that there are no political influences on the Fed, too…). The former, however, means that the pause is on the table.
That’s what was said.
What does it mean? It means that if the inflation isn’t lower, they will have to raise rates again. Why? Because inflation is political – simple as that. That’s the thing that voters are most concerned with, and that’s a fact.
If the inflation does move lower, they will probably not be raising rates again.
Also, Powell added that he doesn’t plan to cut rates anytime soon.
“Inflation going to come down not so quickly,” he said, yesterday. “It will take some time. And in that world, if that forecast is broadly right, it would not be appropriate to cut rates.”
So, to summarize what’s likely to happen: the rates are either moving higher if the inflation doesn’t decline or the rates are staying where they are if inflation declines visibly.
In both cases, real interest rates (nominal rates minus expected inflation) are going to increase. So, both outcomes presented by Powell are bearish for gold and the rest of the precious metals sector.
People expect that it’s practically certain that the rates will stay as they are on the next Fed meeting and that they will then start to decline. In other words, the market participants think that the rates are going to decline within the next couple of months, but not necessarily in June.
Please note the contrast between the current expectations and what I wrote above as the scenarios that Powell pretty much revealed.
For a long time, we’ve been emphasizing that inflation is much stickier than many expect, so it’s much more likely that what Powell is saying about the rates and the outlook for them is much more realistic than what the market largely expects right now.
We’re probably in the “return to “normal”” part right now, and the most recent upswing was a bull trap. The “New Paradigm” top was likely the moment when many thought that interest rates could be kept very low for decades and during the crypto peak.
Even the name makes perfect sense in light of yesterday’s news and the current expectations. The “return to normal” in this case, means a return to “normally” low interest rates.
So, what does that all imply? That the market is likely to be surprised – negatively so. It’s obvious also from the technical point of view, and I’ve been writing about the bearish stock price forecast for quite a long time now.
Stocks just failed to move to new 2023 highs. They got close but declined shortly thereafter. It looks like we’re going to get the right shoulder of the head-and-shoulder top formation completed in the following weeks.
Commodities like crude oil and copper are already declining, and so do their producers.
Comment:
What Does All the Above Imply for the Forecast for Gold Prices?
Gold has two primary fundamental drivers. One is the USD Index (so, the forex price moves are important), and the other is the real (!) interest rate.
As I explained above, the real interest rates are likely to go higher, which means that gold is likely to go lower. The reason why gold moved higher in the previous months is likely due to the overall situation on the market – the move from the “bull trap” to the “return to normal” stage of the bear market. And now – with the following moves in interest rates and inflation, it’s likely to become clear what is really happening and what’s not.
So, yes, gold is likely to slide as well.
However, silver and junior mining stocks are likely to take most of the burden due to their links with the general stock market.
Silver is widely used in the industry, so falling industrial demand is likely to negatively affect the silver price projection; and junior mining stocks have proven to be particularly linked to the general stock market many times in the past. Remember the 2020 slide? Junior miners declined the most.
Gold has two primary fundamental drivers. One is the USD Index (so, the forex price moves are important), and the other is the real (!) interest rate.
As I explained above, the real interest rates are likely to go higher, which means that gold is likely to go lower. The reason why gold moved higher in the previous months is likely due to the overall situation on the market – the move from the “bull trap” to the “return to normal” stage of the bear market. And now – with the following moves in interest rates and inflation, it’s likely to become clear what is really happening and what’s not.
So, yes, gold is likely to slide as well.
However, silver and junior mining stocks are likely to take most of the burden due to their links with the general stock market.
Silver is widely used in the industry, so falling industrial demand is likely to negatively affect the silver price projection; and junior mining stocks have proven to be particularly linked to the general stock market many times in the past. Remember the 2020 slide? Junior miners declined the most.
Comment:
Please note that junior mining stocks moved only slightly higher yesterday despite a quite notable daily upswing in gold. Junior miners’ weakness relative to gold is one of the bottom-up signs (as opposed to the top-down signs like aligning the situation with the general cycles of bull/bear markets) pointing to lower precious metals values in the following weeks.
Comment:
For comparison, gold moved notably higher, and it moved even higher in the overnight trading (that’s not visible on the above chart). Yet, the GDXJ is only slightly up in today’s London trading.
So, all in all, I’d view this week’s upswing as something temporary and not really sustainable. The profits on the short positions in FCX are likely to increase further, and the precious metals sector is likely to join in this decline, too. In particular, in my view, the downside potential for junior mining stocks is enormous at this time.
So, all in all, I’d view this week’s upswing as something temporary and not really sustainable. The profits on the short positions in FCX are likely to increase further, and the precious metals sector is likely to join in this decline, too. In particular, in my view, the downside potential for junior mining stocks is enormous at this time.
Comment:
CENTRAL BANKS are buying
GOLD
at HISTORIC rates
According to the data registered in the first quarter of 2023, the Central Banks have added 228 TONS of Gold to their global reserves 😱
The highest figure ever recorded in this period
GOLD
at HISTORIC rates According to the data registered in the first quarter of 2023, the Central Banks have added 228 TONS of Gold to their global reserves 😱
The highest figure ever recorded in this period
Comment:
Gold has two primary fundamental drivers. One is the USD Index (so, the forex price moves are important), and the other is the real (!) interest rate.
Comment:
Zimbabwe’s central bank to issue gold-backed digital currency
Comment:
Barrick Gold is a Hold as Long as Gold Prices Stay Stagnant
After an initial drop after its earnings report, Barrick Gold stock is moving higher.
The company is reporting lower production which is a drag on earnings.
GOLD stock is also under pressure as investors are investing in the stronger dollar.
Mining stocks are ideal for diversification, but if you’re looking for capital appreciation, you may be disappointed.
5 stocks we like better than Barrick Gold
On the positive side, the gold miner beat on both the top and bottom lines. Revenue came in at $2.53 billion which was 2.5% better than the $2.47 billion that was forecast. And earnings were even stronger. The 13 cents earnings per share were more than 18% higher than the 10 cents EPS analysts were expecting.
Now the bad news. For the third consecutive quarter, the company posted declining earnings. And both revenue and earnings are significantly lower on a year-over-year basis.
GOLD stock quickly sliced through a previous support level, and it undoubtedly confounded traders who saw a double bottom form in the stock price in the last two months. Is this a time to buy on the dip, or is a stronger dollar a time to stay away from gold?
After an initial drop after its earnings report, Barrick Gold stock is moving higher.
The company is reporting lower production which is a drag on earnings.
GOLD stock is also under pressure as investors are investing in the stronger dollar.
Mining stocks are ideal for diversification, but if you’re looking for capital appreciation, you may be disappointed.
5 stocks we like better than Barrick Gold
On the positive side, the gold miner beat on both the top and bottom lines. Revenue came in at $2.53 billion which was 2.5% better than the $2.47 billion that was forecast. And earnings were even stronger. The 13 cents earnings per share were more than 18% higher than the 10 cents EPS analysts were expecting.
Now the bad news. For the third consecutive quarter, the company posted declining earnings. And both revenue and earnings are significantly lower on a year-over-year basis.
GOLD stock quickly sliced through a previous support level, and it undoubtedly confounded traders who saw a double bottom form in the stock price in the last two months. Is this a time to buy on the dip, or is a stronger dollar a time to stay away from gold?
Comment:
Gold struggles to make a return to record highs
Comment:
Gold faced brutal selling on Friday after an exciting run towards a record high of 2,079, but it managed to end the week within the 2,000 territory.
Although the precious metal is trying to heal its wounds at the moment, the technical picture cannot warrant a proper rebound to the uncharted zone. On the one hand, the RSI and the MACD, although weaker, keep promoting the positive scenario as the former is fluctuating above its 50 neutral mark, and the latter is hovering above its red signal line. On the other hand, the price seems to have created a bearish evening star candlestick pattern around its new all-time high, increasing the odds of a downside reversal.
The 23.6% Fibonacci retracement of the March-May upleg is currently providing a footing under the price around 2,015. Should that base crack, the bears may push for a close below 2,000 and beneath the tentative ascending trendline drawn from the March lows. A steeper decline could take a halt within the key 1,980-1,976 area, which includes the 38.2% Fibonacci level and the support trendline from March 22. Another failure here could boost selling pressures towards the 50-day simple moving average (SMA) at 1,957 or lower to the 50% Fibonacci of 1,945.
On the upside, the bulls will need to climb back above the former resistance of 2,020 in order to prompt a bounce towards the 2,050 barrier. A decisive close higher could be a prerequisite for a rally to record highs. Note that the extension of the 2023 resistance line is currently around 2,082, while the 2,100 number could be of psychological importance.
Although the precious metal is trying to heal its wounds at the moment, the technical picture cannot warrant a proper rebound to the uncharted zone. On the one hand, the RSI and the MACD, although weaker, keep promoting the positive scenario as the former is fluctuating above its 50 neutral mark, and the latter is hovering above its red signal line. On the other hand, the price seems to have created a bearish evening star candlestick pattern around its new all-time high, increasing the odds of a downside reversal.
The 23.6% Fibonacci retracement of the March-May upleg is currently providing a footing under the price around 2,015. Should that base crack, the bears may push for a close below 2,000 and beneath the tentative ascending trendline drawn from the March lows. A steeper decline could take a halt within the key 1,980-1,976 area, which includes the 38.2% Fibonacci level and the support trendline from March 22. Another failure here could boost selling pressures towards the 50-day simple moving average (SMA) at 1,957 or lower to the 50% Fibonacci of 1,945.
On the upside, the bulls will need to climb back above the former resistance of 2,020 in order to prompt a bounce towards the 2,050 barrier. A decisive close higher could be a prerequisite for a rally to record highs. Note that the extension of the 2023 resistance line is currently around 2,082, while the 2,100 number could be of psychological importance.
Comment:
Gold resistance 2035, 2075/81, 2149 – support 1959, 1926 (key), 1891-1903
Comment:
Technical Outlook: In last month’s Gold Weekly Price Forecast we note that XAU/USD was trading just below the yearly high-week close and that, “A topside breach / weekly close above 2004 is needed to fuel another test of the record high-week close at 2035 and the record high at 2075- look for a larger reaction there IF reached.” Prices ripped higher this week on the heels of the FOMC rate decision with Gold briefly ripping to a fresh record high (registered at 2081) before pulling back sharply into the close of the week.
The move suggests another failed attempt to mount the record high with a close back below the record 2020 high-close at 2035 once again threatening topside exhaustion in XAU/USD. A newly identified ascending pitchfork extending off the 2021 & 2022 lows (blue) seems to be defining this advance rather well with initial support eyed at the median-line. Lateral support rests at the objective January high at 1959 backed by the April high-week reversal close at 1926- losses should be limited to this threshold IF price is heading higher on this stretch. Broader bullish invalidation now raised to the May high-week close / 38.2% Fibonacci retracement at 1891-1903.
Initial resistance steady at 2035 with a breach / close above 2075/81 needed to mark resumption of the broader uptrend towards the 75% parallel (currently ~2100) and the 100% extension of the 2022 advance at 2149.
Bottom line: Gold is testing resistance at the record highs on building momentum divergence. The last time we tested these highs price closed 1.93% & 3.8% in 2020 & 2022 respectively- both ultimately fueled declines of more than 19% and while the broader outlook remains constructive, the immediate advance may be vulnerable after this last attempt.
From a trading standpoint, a good zone to reduce portions of long-exposure / raise protective stops – losses should be limited to the 2022 channel line IF price is heading higher on this stretch with a weekly close above 2075 needed to mark resumption.
The move suggests another failed attempt to mount the record high with a close back below the record 2020 high-close at 2035 once again threatening topside exhaustion in XAU/USD. A newly identified ascending pitchfork extending off the 2021 & 2022 lows (blue) seems to be defining this advance rather well with initial support eyed at the median-line. Lateral support rests at the objective January high at 1959 backed by the April high-week reversal close at 1926- losses should be limited to this threshold IF price is heading higher on this stretch. Broader bullish invalidation now raised to the May high-week close / 38.2% Fibonacci retracement at 1891-1903.
Initial resistance steady at 2035 with a breach / close above 2075/81 needed to mark resumption of the broader uptrend towards the 75% parallel (currently ~2100) and the 100% extension of the 2022 advance at 2149.
Bottom line: Gold is testing resistance at the record highs on building momentum divergence. The last time we tested these highs price closed 1.93% & 3.8% in 2020 & 2022 respectively- both ultimately fueled declines of more than 19% and while the broader outlook remains constructive, the immediate advance may be vulnerable after this last attempt.
From a trading standpoint, a good zone to reduce portions of long-exposure / raise protective stops – losses should be limited to the 2022 channel line IF price is heading higher on this stretch with a weekly close above 2075 needed to mark resumption.
Comment:
Gold starting to rise again. Correttion is over
Comment:
Current Setup Gold
6D Bar Chart setup Log
Daily Long
4 H Lon
Hourly Long
6D Bar Chart setup Log
Daily Long
4 H Lon
Hourly Long
Comment:
Fed says banking sector looks set to weather recent turmoil
"The Federal Reserve is prepared to address any liquidity pressures that may arise and is committed to ensuring that the U.S. banking system continues to perform its vital roles," the Fed said.
While the central bank noted there were spillover concerns following the failures of Santa Clara, California-based SVB and New York-based Signature, it maintained that the issues that sank those regional banks do not appear broadly across the banking sector, calling them "outliers" in terms of heavy reliance on uninsured deposits.
Those firms, as well as First Republic Bank, which was closed by regulators earlier this month and sold to JP Morgan Chase, also were grappling with large amounts of unrealized losses spurred by rapidly rising interest rates. Depositors fled SVB within days after it appeared the firm was in trouble, precipitating its abrupt closure.
The Fed noted in its report on Monday that more than 45% of bank assets reprice or mature within a year, suggesting there is not heavy exposure to less valuable securities for long periods of time. But while the amount of uninsured deposits at banks is declining, they still remain above historical averages after an influx of deposits spurred by the COVID-19 pandemic. In aggregate, it said banks remain well-capitalized.
DEBT LIMIT CONCERNS
The Fed released the report shortly after a separate central bank survey found banks were tightening credit standards amid weaker loan demand.
Beyond banks, the Fed said pressures on various market sectors remained within historical norms. However, it noted that valuations on commercial real estate remain high, which suggests there could be a "sizable" correction in property values should telework trends remain strong. The Fed found that banks hold about 60% of commercial real estate loans, with two-thirds of those at smaller lenders with less than $100 billion in assets.
The Fed's report also found that nearly half of its respondents identified the U.S. debt limit as a salient risk, after not appearing as a top concern in the previous report in November. U.S. Treasury Secretary Janet Yellen said the limit could be reached in June, but Democrats and Republicans are still sparring over what conditions, if any, should be attached to an increase.
Banking sector stresses were identified as a risk by more than half of respondents, up from 12% in the November report.
"The Federal Reserve is prepared to address any liquidity pressures that may arise and is committed to ensuring that the U.S. banking system continues to perform its vital roles," the Fed said.
While the central bank noted there were spillover concerns following the failures of Santa Clara, California-based SVB and New York-based Signature, it maintained that the issues that sank those regional banks do not appear broadly across the banking sector, calling them "outliers" in terms of heavy reliance on uninsured deposits.
Those firms, as well as First Republic Bank, which was closed by regulators earlier this month and sold to JP Morgan Chase, also were grappling with large amounts of unrealized losses spurred by rapidly rising interest rates. Depositors fled SVB within days after it appeared the firm was in trouble, precipitating its abrupt closure.
The Fed noted in its report on Monday that more than 45% of bank assets reprice or mature within a year, suggesting there is not heavy exposure to less valuable securities for long periods of time. But while the amount of uninsured deposits at banks is declining, they still remain above historical averages after an influx of deposits spurred by the COVID-19 pandemic. In aggregate, it said banks remain well-capitalized.
DEBT LIMIT CONCERNS
The Fed released the report shortly after a separate central bank survey found banks were tightening credit standards amid weaker loan demand.
Beyond banks, the Fed said pressures on various market sectors remained within historical norms. However, it noted that valuations on commercial real estate remain high, which suggests there could be a "sizable" correction in property values should telework trends remain strong. The Fed found that banks hold about 60% of commercial real estate loans, with two-thirds of those at smaller lenders with less than $100 billion in assets.
The Fed's report also found that nearly half of its respondents identified the U.S. debt limit as a salient risk, after not appearing as a top concern in the previous report in November. U.S. Treasury Secretary Janet Yellen said the limit could be reached in June, but Democrats and Republicans are still sparring over what conditions, if any, should be attached to an increase.
Banking sector stresses were identified as a risk by more than half of respondents, up from 12% in the November report.
Comment:
Gold is moving higher as traders focus on the weakness of the American currency.
Silver is trying to settle below the support at $25.60.
Platinum rallied towards the $1080 level.
Silver is trying to settle below the support at $25.60.
Platinum rallied towards the $1080 level.
Comment:
Gold is currently trying to settle back above the $2025 level as U.S. dollar remains under pressure. Traders ignore rising Treasury yields and focus on the weakness of the American currency.
If gold settles above $2025, it will move towards the resistance at $2050. A successful test of the resistance at $2050 will push gold towards the next resistance at $2070.
R1:$2025 – R2:$2050 – R3:$2070
S1:$2010 – S2:$2000 – S3:$1980
If gold settles above $2025, it will move towards the resistance at $2050. A successful test of the resistance at $2050 will push gold towards the next resistance at $2070.
R1:$2025 – R2:$2050 – R3:$2070
S1:$2010 – S2:$2000 – S3:$1980
Comment:
Janet Yellen Warns of a Potential “Constitutional Crisis”
Comment:
U.S. Treasury Secretary Warns of Dire Consequences if Debt Ceiling is Not Raised
Speaking on ABC’s “This Week” on Sunday U.S. Treasury Secretary Janet Yellen said that negotiations in regards to raising or suspending the debt ceiling should not take place “with a gun to the head of the American people”. During her interview, she issued a dire warning that a failure by Congress to act on the debt ceiling would trigger a “constitutional crisis” that would also call into question the federal government’s creditworthiness.
She expressed the seriousness of the financial market’s consequences if the debt ceiling is not raised by early June, when she said that, “the federal government could run short of cash to pay bills”. The Treasury Secretary adamantly expressed that “it’s Congress’s job to do it, if they failed to do it, we will have an economic and financial catastrophe that will be of our own making”.
The president will meet with the Republican House Speaker Kevin McCarthy, Republican Senate Minority Leader Mitch McConnell, and top congressional Democrats on Tuesday to discuss the issue.
The divide between legislators has become a bottomless chasm with President Biden and his Democratic constituent’s adamant that Congress should raise the debt ceiling without conditions. Democratic Senate majority leader Chuck Schumer last week began the process of preparing legislation that would suspend the government’s debt limit for two years without conditions. This was met with strong resistance by a group of 43 Republican senators who said they oppose any bill that would only raise the US debt ceiling without addressing other priorities.
This is quite different from the Republican-led House of Representatives bill that was passed last month that would raise the government’s $31.4 trillion debt ceiling by $1.5 trillion and concurrently cut approximately $4.5 trillion of government programs out of the annual budget. President Biden vowed to veto the congressional bill passed last month.
Speaking on ABC’s “This Week” on Sunday U.S. Treasury Secretary Janet Yellen said that negotiations in regards to raising or suspending the debt ceiling should not take place “with a gun to the head of the American people”. During her interview, she issued a dire warning that a failure by Congress to act on the debt ceiling would trigger a “constitutional crisis” that would also call into question the federal government’s creditworthiness.
She expressed the seriousness of the financial market’s consequences if the debt ceiling is not raised by early June, when she said that, “the federal government could run short of cash to pay bills”. The Treasury Secretary adamantly expressed that “it’s Congress’s job to do it, if they failed to do it, we will have an economic and financial catastrophe that will be of our own making”.
The president will meet with the Republican House Speaker Kevin McCarthy, Republican Senate Minority Leader Mitch McConnell, and top congressional Democrats on Tuesday to discuss the issue.
The divide between legislators has become a bottomless chasm with President Biden and his Democratic constituent’s adamant that Congress should raise the debt ceiling without conditions. Democratic Senate majority leader Chuck Schumer last week began the process of preparing legislation that would suspend the government’s debt limit for two years without conditions. This was met with strong resistance by a group of 43 Republican senators who said they oppose any bill that would only raise the US debt ceiling without addressing other priorities.
This is quite different from the Republican-led House of Representatives bill that was passed last month that would raise the government’s $31.4 trillion debt ceiling by $1.5 trillion and concurrently cut approximately $4.5 trillion of government programs out of the annual budget. President Biden vowed to veto the congressional bill passed last month.
Comment:
Federal Reserve Survey Shows Credit Conditions Tightening
According to a Federal Reserve survey of bank loan officers, credit conditions for US businesses and households continue to tighten in the first quarter of this year. According to the survey bank loan officers believe the tightening is the direct result of the accumulating impact of the aggressive monetary policy by the Federal Reserve.
According to a Federal Reserve survey of bank loan officers, credit conditions for US businesses and households continue to tighten in the first quarter of this year. According to the survey bank loan officers believe the tightening is the direct result of the accumulating impact of the aggressive monetary policy by the Federal Reserve.
Comment:
Gold Prices See Modest Gains
Comment:
Gold traders watching US inflation data for Fed policy clues while monitoring US banking sector and debt ceiling updates that may impact prices.
Comment:
Gold (XAU) Highlights
Traders await April’s US consumer price index data
Job growth in April increases yields and may impact Federal Reserve policy
The US banking sector and debt ceiling are also major market concerns
Traders await April’s US consumer price index data
Job growth in April increases yields and may impact Federal Reserve policy
The US banking sector and debt ceiling are also major market concerns
Comment:
Gold Prices Vulnerable to Rate Hike
Gold prices could drop to $1,956 – $1,923 if the inflation report indicates a high possibility of another Fed rate hike in June, as this would reduce the appeal of the non-yielding asset. Despite gold being seen as an inflation hedge, higher rates can dampen its appeal. At present, traders have a 86.9% expectation that the U.S. central bank will maintain its current interest rate level in June.
Gold prices could drop to $1,956 – $1,923 if the inflation report indicates a high possibility of another Fed rate hike in June, as this would reduce the appeal of the non-yielding asset. Despite gold being seen as an inflation hedge, higher rates can dampen its appeal. At present, traders have a 86.9% expectation that the U.S. central bank will maintain its current interest rate level in June.
Comment:
Gold is edging higher, well above its pivot at $2002.54. This price is controlling the near-term direction of the market.
A sustained move over $2002.54 will indicate the presence of buyers. The first upside target is (R1) at $2035.78. Overtaking this level will indicate the buying is getting stronger with the next major target (R2) at $2082.03.
A failure to hold $2002.54 will signal the presence of sellers. If this generates enough downside momentum then look for the selling to possibly extend into (S1) at $1956.30.
S1 – $1956.30 R1 – $2035.78
S2 – $1923.06 R2 – $2082.03
S3 – $1876.81 R3 – $2115.26
A sustained move over $2002.54 will indicate the presence of buyers. The first upside target is (R1) at $2035.78. Overtaking this level will indicate the buying is getting stronger with the next major target (R2) at $2082.03.
A failure to hold $2002.54 will signal the presence of sellers. If this generates enough downside momentum then look for the selling to possibly extend into (S1) at $1956.30.
S1 – $1956.30 R1 – $2035.78
S2 – $1923.06 R2 – $2082.03
S3 – $1876.81 R3 – $2115.26
Comment:
There are several factors that are contributing to the rise in gold prices and its record highs, including:
Safe-haven demand: Gold is often seen as a safe-haven asset, and investors may turn to gold during times of economic uncertainty or market volatility. The ongoing COVID-19 pandemic, geopolitical tensions, and inflation concerns have all contributed to increased demand for gold as a safe-haven asset.
Weakness in the US dollar: Gold is priced in US dollars, and a weaker US dollar can make gold more attractive to investors holding other currencies. The US Federal Reserve's monetary policies, including low interest rates and quantitative easing, have contributed to a weaker US dollar and supported higher gold prices.
Stimulus measures: Governments and central banks around the world have implemented massive stimulus measures to support their economies during the pandemic. This has led to concerns about inflation and currency debasement, which have further supported demand for gold.
Supply disruptions: The pandemic has also led to disruptions in gold mining and refining operations, which have limited the supply of gold and contributed to higher prices.
Overall, the combination of these factors has contributed to the rise in gold prices and its record highs, and it is possible that these trends may continue in the near term. However, it is important to note that gold prices can be volatile and subject to a range of market forces, and investors should carefully consider their own risk tolerance and investment goals before investing in gold.
Safe-haven demand: Gold is often seen as a safe-haven asset, and investors may turn to gold during times of economic uncertainty or market volatility. The ongoing COVID-19 pandemic, geopolitical tensions, and inflation concerns have all contributed to increased demand for gold as a safe-haven asset.
Weakness in the US dollar: Gold is priced in US dollars, and a weaker US dollar can make gold more attractive to investors holding other currencies. The US Federal Reserve's monetary policies, including low interest rates and quantitative easing, have contributed to a weaker US dollar and supported higher gold prices.
Stimulus measures: Governments and central banks around the world have implemented massive stimulus measures to support their economies during the pandemic. This has led to concerns about inflation and currency debasement, which have further supported demand for gold.
Supply disruptions: The pandemic has also led to disruptions in gold mining and refining operations, which have limited the supply of gold and contributed to higher prices.
Overall, the combination of these factors has contributed to the rise in gold prices and its record highs, and it is possible that these trends may continue in the near term. However, it is important to note that gold prices can be volatile and subject to a range of market forces, and investors should carefully consider their own risk tolerance and investment goals before investing in gold.
Comment:
Recession in the United States
Will the recession in the US – if it is actually rolling – significantly reduce the demand for oil, which could justify the already falling oil price? Well, on Friday at 2:30 p.m. they showed US labor market data for April: The US unemployment rate drops to 3.4% ( forecast 3.6% ). And: 253,000 new jobs were created in the USA in April ( Forecast + 180,000 ). So the US economy is running more robust than many analysts thought. Does that mean for the oil price? Possibly oil demand will continue to be at a higher level, which the futures market immediately priced in. Since Friday at 2:30 p.m. we have seen an increase in American WTI oil of $ 2.
Will the recession in the US – if it is actually rolling – significantly reduce the demand for oil, which could justify the already falling oil price? Well, on Friday at 2:30 p.m. they showed US labor market data for April: The US unemployment rate drops to 3.4% ( forecast 3.6% ). And: 253,000 new jobs were created in the USA in April ( Forecast + 180,000 ). So the US economy is running more robust than many analysts thought. Does that mean for the oil price? Possibly oil demand will continue to be at a higher level, which the futures market immediately priced in. Since Friday at 2:30 p.m. we have seen an increase in American WTI oil of $ 2.
Comment:
Inflation: Companies rely on the principle „ Price before quantity “
The current reporting season in the USA has confirmed again what has emerged everywhere in the past few months: the companies are relying on a new strategy. Instead of increasing sales figures, they are now increasingly relying on higher prices in order to achieve their sales and profit targets. This affects almost every industry. From car manufacturers to hoteliers, more and more companies are foregoing sales volumes in favor of higher prices. Sometimes they do this on purpose, sometimes they have no choice. So far, the strategy has worked, as the predominantly good quarterly figures show. Consumers still seem to ignore the high inflation ( ) and are still willing to pay the higher prices. This dynamic makes it harder for the Fed to fight inflation,and she could also be for others Central banks prove to be a problem.
Price increases as a driver of inflation
If one goes according to the statements in the recently published quarterly reports, the companies will not move away from the principle “ price before quantity ”. Already at the height of the pandemic, the strategy was the preferred choice in certain industries because the supply chains were significantly disrupted.
Example Ford: The carmaker maintains the higher sales prices, even if fewer cars roll off the assembly line. Example Marriott: The hotel operator increases room prices, especially for corporate customers. Southwest Airlines also relies on the principle: the airline achieves record sales in view of the limited flight capacity and keeps prices high. As the main vacation time is approaching, price power is not expected to fade, Bloomberg said.
With the US consumer price data for April, economists surveyed by Bloomberg expect inflation to remain unchanged at 5%. Before that, the inflation slowed down for nine months in a row. “ Inflation will prove to be far more persistent, pronounced and problematic for the US Federal Reserve in the summer than expected ”, says economist Samuel Rines, Managing Director at Corbu.
In the US automotive sector, new car prices are not far from their record values. The average monthly rate was $ 754 in March, almost one sixth of the average net income of US households. The surge in prices is likely to worsen as automobile manufacturers want to switch their fleets to more expensive electric models.
Inflation: pandemic aftermath
Already in the Corona pandemic, Ford and its competitors recognized that the serious chip bottlenecks also meant that you could make more profit with less produced cars.
For airlines, it is the lack of trained pilots and the backlog of new aircraft and spare parts that hinders sales. Southwest could have offered up to 8% more flight capacity in March if it had enough staff.
The capacity bottlenecks combined with the strong demand enable the industry to charge high prices, especially for transatlantic flights. The average price for a return flight to Europe is $ 1,032. This makes them 35% more expensive than last year and 24% more expensive than before the pandemic, as data from the Hopper rice search engine show. The figures suggest that international airfares will reach their highest level in five years this summer.
Companies support their profitability with price increases
The hotel industry has also adapted to the current consumer environment. According to market observer STR, US overnight prices rose by more than 10% in the first quarter, while occupancy only increased by around 6.
One reason for this is the changed demand mix: Leisure travelers have returned faster than customers than business travelers, which focuses demand on weekends. However, the owners have gotten used to operating hotels with lower occupancy but also lower cleaning costs.
“ The pandemic has lost a lot of staff, but has also gained a lot of pricing power ”, says Jan Freitag, director of the hotel analysis area at CoStar.
The producers of consumer bulk goods also put margin on sales: the Kimberly-Clark Corp. from Dallas, Texas, which produces Kleenex towels and toilet paper, increased prices in all categories by 10% in the last quarter. In view of this, sales decreased by 5. However, the gross margin rose to 33% from around 30% a year ago.
“ Therefore, when the price of toilet paper rises, you generally do not go to the toilet less often, do you? ” CEO Michael Hsu said at last month's press conference.
Rines notes with investors the expectation that companies will support their profitability with price increases. “ Companies do it everywhere, that's clear to see ”, he says. “ And if companies can't do it, they will be put under pressure. ” On the other hand, there is a risk of being attacked by consumers or politics.
Diana Gomes of Bloomberg Intelligence still sees the gross margin of the consumer goods companies she observes below the 2019 level. This suggests that the price increases so far only offset the increases in raw material and supply chain costs.
With a view to the fight against inflation, prices for travel and hotel accommodation for the Fed represent the biggest problem.
The current reporting season in the USA has confirmed again what has emerged everywhere in the past few months: the companies are relying on a new strategy. Instead of increasing sales figures, they are now increasingly relying on higher prices in order to achieve their sales and profit targets. This affects almost every industry. From car manufacturers to hoteliers, more and more companies are foregoing sales volumes in favor of higher prices. Sometimes they do this on purpose, sometimes they have no choice. So far, the strategy has worked, as the predominantly good quarterly figures show. Consumers still seem to ignore the high inflation ( ) and are still willing to pay the higher prices. This dynamic makes it harder for the Fed to fight inflation,and she could also be for others Central banks prove to be a problem.
Price increases as a driver of inflation
If one goes according to the statements in the recently published quarterly reports, the companies will not move away from the principle “ price before quantity ”. Already at the height of the pandemic, the strategy was the preferred choice in certain industries because the supply chains were significantly disrupted.
Example Ford: The carmaker maintains the higher sales prices, even if fewer cars roll off the assembly line. Example Marriott: The hotel operator increases room prices, especially for corporate customers. Southwest Airlines also relies on the principle: the airline achieves record sales in view of the limited flight capacity and keeps prices high. As the main vacation time is approaching, price power is not expected to fade, Bloomberg said.
With the US consumer price data for April, economists surveyed by Bloomberg expect inflation to remain unchanged at 5%. Before that, the inflation slowed down for nine months in a row. “ Inflation will prove to be far more persistent, pronounced and problematic for the US Federal Reserve in the summer than expected ”, says economist Samuel Rines, Managing Director at Corbu.
In the US automotive sector, new car prices are not far from their record values. The average monthly rate was $ 754 in March, almost one sixth of the average net income of US households. The surge in prices is likely to worsen as automobile manufacturers want to switch their fleets to more expensive electric models.
Inflation: pandemic aftermath
Already in the Corona pandemic, Ford and its competitors recognized that the serious chip bottlenecks also meant that you could make more profit with less produced cars.
For airlines, it is the lack of trained pilots and the backlog of new aircraft and spare parts that hinders sales. Southwest could have offered up to 8% more flight capacity in March if it had enough staff.
The capacity bottlenecks combined with the strong demand enable the industry to charge high prices, especially for transatlantic flights. The average price for a return flight to Europe is $ 1,032. This makes them 35% more expensive than last year and 24% more expensive than before the pandemic, as data from the Hopper rice search engine show. The figures suggest that international airfares will reach their highest level in five years this summer.
Companies support their profitability with price increases
The hotel industry has also adapted to the current consumer environment. According to market observer STR, US overnight prices rose by more than 10% in the first quarter, while occupancy only increased by around 6.
One reason for this is the changed demand mix: Leisure travelers have returned faster than customers than business travelers, which focuses demand on weekends. However, the owners have gotten used to operating hotels with lower occupancy but also lower cleaning costs.
“ The pandemic has lost a lot of staff, but has also gained a lot of pricing power ”, says Jan Freitag, director of the hotel analysis area at CoStar.
The producers of consumer bulk goods also put margin on sales: the Kimberly-Clark Corp. from Dallas, Texas, which produces Kleenex towels and toilet paper, increased prices in all categories by 10% in the last quarter. In view of this, sales decreased by 5. However, the gross margin rose to 33% from around 30% a year ago.
“ Therefore, when the price of toilet paper rises, you generally do not go to the toilet less often, do you? ” CEO Michael Hsu said at last month's press conference.
Rines notes with investors the expectation that companies will support their profitability with price increases. “ Companies do it everywhere, that's clear to see ”, he says. “ And if companies can't do it, they will be put under pressure. ” On the other hand, there is a risk of being attacked by consumers or politics.
Diana Gomes of Bloomberg Intelligence still sees the gross margin of the consumer goods companies she observes below the 2019 level. This suggests that the price increases so far only offset the increases in raw material and supply chain costs.
With a view to the fight against inflation, prices for travel and hotel accommodation for the Fed represent the biggest problem.
Comment:
Allianz chief economist warns of the risk of a new “ financial accident “
According to the chief economist of the alliance, there is a risk of new "financial accidents". It's about heavily debt-ridden financial markets.
What have you seen? From 2007 it was the US real estate market that US financial crisis 2008 triggered. Then there was the Euro sovereign debt crisis, then 2020 Corona crisis, then inflation, and then the Ukraine war. Again and again there are events that are not foreseen by the general public and also by the broad mass of „ experts “, or that simply cannot be foreseen ( see Corona ). The higher inflation was very well forecast by some of the analyst and economist community. And so it is today with a view to possibly further upcoming „ financial accidents “.
Will there be further breakdowns at US banks? Has this crisis been going on for two months? Crashen numerous overly committed Hedge funds, who gamble fully on credit? Do securitized loan packages for company takeovers collapse? Is the commercial real estate market collapsing? This is a danger, especially in the USA. In the opinion of the chief economist of the alliance, investors in the financial markets should be prepared for months of market adjustments, which are overshadowed by the risk of a new “ financial accident ”. “ We have all the ingredients for a so-called Minsky moment ”, so Ludovic Subran explained it today at Bloomberg TV. The economist Hyman Minsky had described situations in which heavily debt-ridden financial markets suddenly collapse. “ You can see that everywhere, these liquidity pools or liquidity bottlenecks are slowly becoming visible. ”
Since the Regional bank crisis in the United States others have already expressed themselves in this regard. Subran's remarks, however, underline that the circumstances that led to the panic of investors in bank stocks in the United States and in Europe collapse that Credit Suisse ushered in, did not disappear. “ Of course, commercial real estate and the vicious circle with regional banks in the United States are worrying ”, he said. “ I am concerned about the incorrect assessment of corporate credit risks — especially if you look at it, that high interest rate risk premiums are still too small to be honest. For me, the focus is also on financial intermediaries outside the banking sector. ”
In addition to the current tensions, the global monetary policy turnaround has led to aggressive interest rate hikes ( see ECB and Fed), says Subran, who previously worked for the World Bank and the French Ministry of Finance. However, there is more to it. “ The very abrupt tightening is a problem for everyone. But there is also the level of wrong risk management. A new financial accident could come from the banking sector, but also from some hedge funds ” that specialize very heavily in commercial real estate. But there is also a problem that arises from a mixture of these two factors.
According to the chief economist of the alliance, there is a risk of new "financial accidents". It's about heavily debt-ridden financial markets.
What have you seen? From 2007 it was the US real estate market that US financial crisis 2008 triggered. Then there was the Euro sovereign debt crisis, then 2020 Corona crisis, then inflation, and then the Ukraine war. Again and again there are events that are not foreseen by the general public and also by the broad mass of „ experts “, or that simply cannot be foreseen ( see Corona ). The higher inflation was very well forecast by some of the analyst and economist community. And so it is today with a view to possibly further upcoming „ financial accidents “.
Will there be further breakdowns at US banks? Has this crisis been going on for two months? Crashen numerous overly committed Hedge funds, who gamble fully on credit? Do securitized loan packages for company takeovers collapse? Is the commercial real estate market collapsing? This is a danger, especially in the USA. In the opinion of the chief economist of the alliance, investors in the financial markets should be prepared for months of market adjustments, which are overshadowed by the risk of a new “ financial accident ”. “ We have all the ingredients for a so-called Minsky moment ”, so Ludovic Subran explained it today at Bloomberg TV. The economist Hyman Minsky had described situations in which heavily debt-ridden financial markets suddenly collapse. “ You can see that everywhere, these liquidity pools or liquidity bottlenecks are slowly becoming visible. ”
Since the Regional bank crisis in the United States others have already expressed themselves in this regard. Subran's remarks, however, underline that the circumstances that led to the panic of investors in bank stocks in the United States and in Europe collapse that Credit Suisse ushered in, did not disappear. “ Of course, commercial real estate and the vicious circle with regional banks in the United States are worrying ”, he said. “ I am concerned about the incorrect assessment of corporate credit risks — especially if you look at it, that high interest rate risk premiums are still too small to be honest. For me, the focus is also on financial intermediaries outside the banking sector. ”
In addition to the current tensions, the global monetary policy turnaround has led to aggressive interest rate hikes ( see ECB and Fed), says Subran, who previously worked for the World Bank and the French Ministry of Finance. However, there is more to it. “ The very abrupt tightening is a problem for everyone. But there is also the level of wrong risk management. A new financial accident could come from the banking sector, but also from some hedge funds ” that specialize very heavily in commercial real estate. But there is also a problem that arises from a mixture of these two factors.
Comment:
Why Apple is making the US debt more expensive!
Apple is currently making US debt more expensive. But how is that possible: what does Apple have to do with US debt?
Now – Apple wants to issue bonds and raise money with them. That is exactly what the state of the USA does. But Apple is perceived as an extremely safe haven, the company has massive cash reserves and a profitable operating business.
The US state, on the other hand, is constantly making losses, tax revenues have decreased, while US politicians are currently raising the debt limit (Debt limitwrestle ). If this debt ceiling is not raised, there would be a default –, so bondholders would not be served. This in turn could lead to a rating downgrading of the USA and thus further make debt borrowing more expensive.
Apple makes US debt more expensive
The result: because Apple announced today that it will launch bonds, it is a competition for US bonds. Since Apple is a „ thick fish “ as the company with the greatest market capitalization, the market now assumes that other large US tech companies ( such as Microsoft ) will take this step. So if you want to invest your money safely, you now have good competition for American government bonds – because Apple or Microsoft, for example, could go bankrupt in the near future, is not very likely.
With Apple's announcement that it would launch its own bonds, yields on US government bonds rose significantly: the 10-year US bond yield climbs from 3.42% to 3.50% – in a few minutes a very big movement in a very short time!
Apple Inc. sells bonds on the US first-class bond market on Monday as a flood of borrowers tries to before publication important inflation data to raise cash later this week. Bloomberg now reports details.
According to a person familiar with the matter, the $ 5 billion deal is expected to be in up to five different bonds. The longest term bond of 30 years could pay 135 basis points above comparable government bonds, the person said.
„ The transaction will be very well received by the market “ because we have seen a great demand for high quality fixed income securities “, said Rob Waldner, Chief strategist for fixed income securities and head of macro research at Invesco, on Bloomberg TV.
Bloomberg- surveyed traders expect sales of high-quality US corporate bonds worth $ 30 to $ 35 billion this week as corporate bond markets show signs of stabilization. For Apple, it is the first bond sale since the sale of $ 5.5 billion to finance buybacks and dividends in August.
Up to 15 debtors could sell their bonds on Monday to secure financing before the publication of the data on the consumer price index and the producer price index on Wednesday and Thursday.
Apple bond sales proceeds will be used for general corporate purposes. This could include share buybacks, dividend payments, working capital, capital expenditures, acquisitions and debt repayment, the person said.
An Apple representative did not immediately respond to a request for comment.
Apple is the second mega cap issuer to sell bonds after the profits are announced. Facebook parent company Meta Platforms Inc. raised $ 8.5 billion in its second bond sale last week.
FMW / Bloomberg
Apple is currently making US debt more expensive. But how is that possible: what does Apple have to do with US debt?
Now – Apple wants to issue bonds and raise money with them. That is exactly what the state of the USA does. But Apple is perceived as an extremely safe haven, the company has massive cash reserves and a profitable operating business.
The US state, on the other hand, is constantly making losses, tax revenues have decreased, while US politicians are currently raising the debt limit (Debt limitwrestle ). If this debt ceiling is not raised, there would be a default –, so bondholders would not be served. This in turn could lead to a rating downgrading of the USA and thus further make debt borrowing more expensive.
Apple makes US debt more expensive
The result: because Apple announced today that it will launch bonds, it is a competition for US bonds. Since Apple is a „ thick fish “ as the company with the greatest market capitalization, the market now assumes that other large US tech companies ( such as Microsoft ) will take this step. So if you want to invest your money safely, you now have good competition for American government bonds – because Apple or Microsoft, for example, could go bankrupt in the near future, is not very likely.
With Apple's announcement that it would launch its own bonds, yields on US government bonds rose significantly: the 10-year US bond yield climbs from 3.42% to 3.50% – in a few minutes a very big movement in a very short time!
Apple Inc. sells bonds on the US first-class bond market on Monday as a flood of borrowers tries to before publication important inflation data to raise cash later this week. Bloomberg now reports details.
According to a person familiar with the matter, the $ 5 billion deal is expected to be in up to five different bonds. The longest term bond of 30 years could pay 135 basis points above comparable government bonds, the person said.
„ The transaction will be very well received by the market “ because we have seen a great demand for high quality fixed income securities “, said Rob Waldner, Chief strategist for fixed income securities and head of macro research at Invesco, on Bloomberg TV.
Bloomberg- surveyed traders expect sales of high-quality US corporate bonds worth $ 30 to $ 35 billion this week as corporate bond markets show signs of stabilization. For Apple, it is the first bond sale since the sale of $ 5.5 billion to finance buybacks and dividends in August.
Up to 15 debtors could sell their bonds on Monday to secure financing before the publication of the data on the consumer price index and the producer price index on Wednesday and Thursday.
Apple bond sales proceeds will be used for general corporate purposes. This could include share buybacks, dividend payments, working capital, capital expenditures, acquisitions and debt repayment, the person said.
An Apple representative did not immediately respond to a request for comment.
Apple is the second mega cap issuer to sell bonds after the profits are announced. Facebook parent company Meta Platforms Inc. raised $ 8.5 billion in its second bond sale last week.
FMW / Bloomberg
Comment:
Gold inched higher yesterday ahead of key inflation data in the United States
Comment:
Investors are watching for any clues on the Fed’s interest rate trajectory
“Investors are watching for any clues on the Federal Reserve’s interest rate trajectory.”
“Investors are watching for any clues on the Federal Reserve’s interest rate trajectory.”
Comment:
USA: Debt ceiling – Loss of credit insurance costs explode
USA: Demand for credit default insurance is increasing
The mess has skyrocketed demand for euro-denominated US credit default swaps that are traded the most. These contracts for a default next year were traded on Wednesday at 166 basis points. They reached a record high and exceeded the levels reached during previous unrest over the US debt ceiling in 2011 and 2013.
Trading has picked up momentum due to the peculiarity of the derivatives market, which enables owners to achieve substantial returns in the event of a default. Your payment corresponds to the difference between the market value and the nominal value of the underlying asset – an attractive investment if long-term government bonds are traded particularly cheaply. According to Bloomberg calculations, the potential payout could exceed 2,400.
Emerging markets would be most affected
According to Simon Waever, an analyst at Morgan Stanley, the outstanding net nominal volume of US CDs with $ 5.5 billion is now comparable to many larger emerging markets. Ironically, emerging markets will be most affected by any impact on the overall market.
The anomaly is limited to one-year CDS. Five-year contracts, which are usually more liquid and better reflect the assessment of a country's longer-term credit risk, have also increased in the United States, but are still traded about 100 basis points below the one-year terms. This reverse curve indicates that the risks in the immediate future are considered to be higher than in the longer term.
The CDS price reflects the cost of insurance for a very large loan in a very small insurance market, said Charles Diebel, head of Fixed Income at Mediolanum International Funds
USA: Demand for credit default insurance is increasing
The mess has skyrocketed demand for euro-denominated US credit default swaps that are traded the most. These contracts for a default next year were traded on Wednesday at 166 basis points. They reached a record high and exceeded the levels reached during previous unrest over the US debt ceiling in 2011 and 2013.
Trading has picked up momentum due to the peculiarity of the derivatives market, which enables owners to achieve substantial returns in the event of a default. Your payment corresponds to the difference between the market value and the nominal value of the underlying asset – an attractive investment if long-term government bonds are traded particularly cheaply. According to Bloomberg calculations, the potential payout could exceed 2,400.
Emerging markets would be most affected
According to Simon Waever, an analyst at Morgan Stanley, the outstanding net nominal volume of US CDs with $ 5.5 billion is now comparable to many larger emerging markets. Ironically, emerging markets will be most affected by any impact on the overall market.
The anomaly is limited to one-year CDS. Five-year contracts, which are usually more liquid and better reflect the assessment of a country's longer-term credit risk, have also increased in the United States, but are still traded about 100 basis points below the one-year terms. This reverse curve indicates that the risks in the immediate future are considered to be higher than in the longer term.
The CDS price reflects the cost of insurance for a very large loan in a very small insurance market, said Charles Diebel, head of Fixed Income at Mediolanum International Funds
Comment:
5GOLD 2015 US$
StartsS BULLISH again TO BREAK THROUGH
BULLISH MOMENTUM
Increasing Bullish Volume
StartsS BULLISH again TO BREAK THROUGH
BULLISH MOMENTUM
Increasing Bullish Volume
Comment:
What is the debt ceiling?
The federal government operates in a deficit, spending more than it brings in with taxes, so it’s forced to borrow money to pay for everything from the salaries of armed forces and federal employees to Social Security
Congress has the power of the purse strings, letting it set a limit on what the government can borrow to pay for expenses (the debt ceiling). The current limit is $31.4 trillion.
What happens if the debt ceiling is not raised or suspended?
When does the U.S. hit spending limit?
How many times has the debt ceiling been raised?
How much has the U.S. debt increased in the past 20 years?
What caused the debt?
Answers here
The federal government operates in a deficit, spending more than it brings in with taxes, so it’s forced to borrow money to pay for everything from the salaries of armed forces and federal employees to Social Security
Congress has the power of the purse strings, letting it set a limit on what the government can borrow to pay for expenses (the debt ceiling). The current limit is $31.4 trillion.
What happens if the debt ceiling is not raised or suspended?
When does the U.S. hit spending limit?
How many times has the debt ceiling been raised?
How much has the U.S. debt increased in the past 20 years?
What caused the debt?
Answers here
Comment:
Why Say Recession at All Given How Much Inflation Has Come Down Already?
Because when you dial into the Fed statements over the past several months, they believe anything short of recession will not truly stamp out the flames of inflation. If they just slow down the economy to touch their 2% inflation target, they fear that the remaining embers could reignite higher inflation in the months following.
So, under the heading “Don’t Fight the Fed” probably best that we take them at their word that a recession is coming. And when it is finally on the scene, that is when bears will take charge and stocks will retrace to the previous low of 3,491...and probably lower.
Because when you dial into the Fed statements over the past several months, they believe anything short of recession will not truly stamp out the flames of inflation. If they just slow down the economy to touch their 2% inflation target, they fear that the remaining embers could reignite higher inflation in the months following.
So, under the heading “Don’t Fight the Fed” probably best that we take them at their word that a recession is coming. And when it is finally on the scene, that is when bears will take charge and stocks will retrace to the previous low of 3,491...and probably lower.
Comment:
Shifting Trends
Crude oil was a bigger contributor to inflation in the 1970s, when it was used much more intensively per unit of economic output. Back then, the U.S. economy consumed more than a barrel of crude per $1,000 of gross domestic product. By 2015, that had dropped to about 0.4 barrels per $1,000 of GDP.
5
Reduced reliance on energy, and in particular crude oil, promoted disinflation, or the decline in the inflation rate.
Spot oil prices have retained a strong correlation to market measures of long-term inflation expectations, however.
6
Some analysts have argued that the recent correlation between crude's diminished importance as an economic input and a lower inflation rate may no longer hold as oil is supplemented by less climate damaging but more expensive renewable energy sources and global supply chains give way to costlier domestic or regional sourcing.
7
Goods Producers Pay the Price
Historically, oil prices have exerted more influence on the Producer Price Index (PPI), which measures the prices of goods at the wholesale level, than the CPI, which measures the prices consumers pay for goods and services.
Between 1970 and 2017, the correlation between oil prices and the PPI was 0.71. That's much stronger than the 0.27 correlation with the CPI, according to the Federal Reserve Bank of St. Louis.
8
"The weaker link between oil prices and consumer prices likely comes from the relatively higher weight of services in the U.S. consumption basket, which you’d expect to rely less on oil as a production input," according to the St. Louis Fed.
8
The Federal Reserve's preferred inflation measure, the personal consumption expenditures price index, has a lower gasoline weighting than the CPI.
9
Is Inflation Good or Bad for Oil Prices?
It depends on the time frame. In the short term. higher inflation tends to lead to higher oil prices. In the longer term, if the Federal Reserve raises interest rates and slows economic growth to control inflation, oil prices could decline as a result.
What Type of Inflation Would Be Triggered by an Increase in Oil Prices?
Oil prices have historically had a greater impact on the Producer Price Index (PPI) than on CPI. PPI measures the price of goods at the wholesale level.
What Other Factors Can Cause Oil Prices to Rise?
In addition to the demand for oil to produce a host of products plus its use by the transportation industry, other factors that can cause oil prices to rise include geopolitical tensions, tight supply, and growing economic strength.
The Bottom Line
While the price of oil has historically correlated with inflation, that relationship has become less pronounced since the 1970s. The loosening of this correlation is likely a result of the growth of the service sector which uses energy less intensively than manufacturing.
Since oil is a key input in manufacturing and a major cost factor in shipping, oil prices have tended to have a greater effect on the cost of goods than services, which also explains the relatively weak correlation between oil and CPI and the strong one between crude and PPI.
Crude oil was a bigger contributor to inflation in the 1970s, when it was used much more intensively per unit of economic output. Back then, the U.S. economy consumed more than a barrel of crude per $1,000 of gross domestic product. By 2015, that had dropped to about 0.4 barrels per $1,000 of GDP.
5
Reduced reliance on energy, and in particular crude oil, promoted disinflation, or the decline in the inflation rate.
Spot oil prices have retained a strong correlation to market measures of long-term inflation expectations, however.
6
Some analysts have argued that the recent correlation between crude's diminished importance as an economic input and a lower inflation rate may no longer hold as oil is supplemented by less climate damaging but more expensive renewable energy sources and global supply chains give way to costlier domestic or regional sourcing.
7
Goods Producers Pay the Price
Historically, oil prices have exerted more influence on the Producer Price Index (PPI), which measures the prices of goods at the wholesale level, than the CPI, which measures the prices consumers pay for goods and services.
Between 1970 and 2017, the correlation between oil prices and the PPI was 0.71. That's much stronger than the 0.27 correlation with the CPI, according to the Federal Reserve Bank of St. Louis.
8
"The weaker link between oil prices and consumer prices likely comes from the relatively higher weight of services in the U.S. consumption basket, which you’d expect to rely less on oil as a production input," according to the St. Louis Fed.
8
The Federal Reserve's preferred inflation measure, the personal consumption expenditures price index, has a lower gasoline weighting than the CPI.
9
Is Inflation Good or Bad for Oil Prices?
It depends on the time frame. In the short term. higher inflation tends to lead to higher oil prices. In the longer term, if the Federal Reserve raises interest rates and slows economic growth to control inflation, oil prices could decline as a result.
What Type of Inflation Would Be Triggered by an Increase in Oil Prices?
Oil prices have historically had a greater impact on the Producer Price Index (PPI) than on CPI. PPI measures the price of goods at the wholesale level.
What Other Factors Can Cause Oil Prices to Rise?
In addition to the demand for oil to produce a host of products plus its use by the transportation industry, other factors that can cause oil prices to rise include geopolitical tensions, tight supply, and growing economic strength.
The Bottom Line
While the price of oil has historically correlated with inflation, that relationship has become less pronounced since the 1970s. The loosening of this correlation is likely a result of the growth of the service sector which uses energy less intensively than manufacturing.
Since oil is a key input in manufacturing and a major cost factor in shipping, oil prices have tended to have a greater effect on the cost of goods than services, which also explains the relatively weak correlation between oil and CPI and the strong one between crude and PPI.
Comment:
Stronger EUR/USD is bullish for all dollar-denominated precious metals including gold.
Comment:
XAU/USD rebounds from weekly lows to the $2,020 area
If XAU/USD continues to rise, the next resistance level is seen at $2,025, followed by the $2,045 area. A retreat below $2,010 would weaken the intraday outlook, exposing the $2,000 mark again.
If XAU/USD continues to rise, the next resistance level is seen at $2,025, followed by the $2,045 area. A retreat below $2,010 would weaken the intraday outlook, exposing the $2,000 mark again.
Comment:
Gold going much more higher 2500USD minimum
Comment:
Love the red Days-Gold Bullish
Comment:
Gold 2H Bullish Entring the Strong Bull Zone
Comment:
US Stocks Rise Led by TechUnited States Stock Market
US stocks rose on Monday, with the Dow Jones up more than 50 points, and the S&P 500 and the Nasdaq up 0.4% and 0.6% respectively, as investors remained hopeful about a debt ceiling deal following successful staff-level negotiations over the weekend. President Joe Biden is expected to host top congressional leaders on Tuesday. Tech companies outperformed after European Union regulators approved Microsoft’s proposed $69 billion acquisition of gaming firm Activision Blizzard. Additionally, Atlanta Fed President Raphael Bostic and Chicago Fed economist Austan Goolsbee signaled their preference for pausing interest-rate increases, while Minneapolis Fed President Neel Kashkari suggested the central bank may have more work to do in its inflation fight. Meanwhile, the NY Empire State Manufacturing Index showed an unexpectedly big drop in manufacturing business activity this month.
US stocks rose on Monday, with the Dow Jones up more than 50 points, and the S&P 500 and the Nasdaq up 0.4% and 0.6% respectively, as investors remained hopeful about a debt ceiling deal following successful staff-level negotiations over the weekend. President Joe Biden is expected to host top congressional leaders on Tuesday. Tech companies outperformed after European Union regulators approved Microsoft’s proposed $69 billion acquisition of gaming firm Activision Blizzard. Additionally, Atlanta Fed President Raphael Bostic and Chicago Fed economist Austan Goolsbee signaled their preference for pausing interest-rate increases, while Minneapolis Fed President Neel Kashkari suggested the central bank may have more work to do in its inflation fight. Meanwhile, the NY Empire State Manufacturing Index showed an unexpectedly big drop in manufacturing business activity this month.
Comment:
Gold starts the week on the front foot after testing $2k support in the last couple of sessions. The precious metal continues to respect this level and with little in the way of high-impact economic data on the calendar this week, traders will look to commentary from a host of Federal Reserve speakers this week to provide some volatility. Today sees scheduled commentary from Fed members Bostic, Kashkari, Barkin, and Cook, while other board members speak throughout the week.
Comment:
US Stocks RiseUnited States Stock Market
US stocks were in the green on Wednesday, with the Dow Jones rising more than 180 points, the S&P 500 up 0.5% and the Nasdaq gaining 0.4% as traders continue to follow the debt ceiling standoff, corporate results and a rebound in regional bank shares. Congressional leaders said Tuesday's talks on the debt limit were productive, but they're still far from a deal and would continue to have meetings later this week. Meanwhile, shares of Western Alliance Bancorp surged more than 10% after the lender reported growth in deposits this quarter. Also, Tesla stocks were up almost 1% after Elon Musk said the company will start to advertise its cars. On the other hand, earnings and revenue from Target topped forecasts but the shares were falling 1.1% after warning of softening sales trend.
US stocks were in the green on Wednesday, with the Dow Jones rising more than 180 points, the S&P 500 up 0.5% and the Nasdaq gaining 0.4% as traders continue to follow the debt ceiling standoff, corporate results and a rebound in regional bank shares. Congressional leaders said Tuesday's talks on the debt limit were productive, but they're still far from a deal and would continue to have meetings later this week. Meanwhile, shares of Western Alliance Bancorp surged more than 10% after the lender reported growth in deposits this quarter. Also, Tesla stocks were up almost 1% after Elon Musk said the company will start to advertise its cars. On the other hand, earnings and revenue from Target topped forecasts but the shares were falling 1.1% after warning of softening sales trend.
Comment:
US Housing Starts Unexpectedly Rise
Housing starts in the US unexpectedly increased 2.2% month-over-month to a seasonally adjusted annualized rate of 1.401 million in April of 2023, compared to market forecasts of 1.4 million. Data for March was revised sharply lower to 1.37 million from 1.42 million, as high prices, interest rates, and tighter lending standards continue to weigh. Single-family housing starts, which account for the bulk of homebuilding, increased 1.6% to a four-month high of 846K and starts in buildings with five units or more surged by 5.2% to 542K. Starts rose in the West (34.6% to 315K) and the Midwest (32.6% to 171K) but fell in the Northeast (-23.4% to 131K) and the South (-6.3% to 784K).
Housing starts in the US unexpectedly increased 2.2% month-over-month to a seasonally adjusted annualized rate of 1.401 million in April of 2023, compared to market forecasts of 1.4 million. Data for March was revised sharply lower to 1.37 million from 1.42 million, as high prices, interest rates, and tighter lending standards continue to weigh. Single-family housing starts, which account for the bulk of homebuilding, increased 1.6% to a four-month high of 846K and starts in buildings with five units or more surged by 5.2% to 542K. Starts rose in the West (34.6% to 315K) and the Midwest (32.6% to 171K) but fell in the Northeast (-23.4% to 131K) and the South (-6.3% to 784K).
Comment:
The yield on the US 10-year Treasury note continued to march higher to top 3.6%, a level not seen in nearly two months, as investors follow the debt ceiling standoff and try to assess the Fed's next steps. Congressional lawmakers and President Biden expressed optimism on a deal and said the US will not default. At the same time, bets the Fed will cut rates this year fell and the chances of a pause in rate hikes in June also weakened. Dallas Federal Reserve President Lorie Logan said Thursday current economic data doesn't justify yet pausing the rate hiking-cycle. Retail sales data released this week showed consumer spending remained resilient and initial claims fell more than anticipated.
Comment:
US stock futures edged higher on Friday after the major averages gained during Thursday’s regular session, as easing concerns about the US debt ceiling crisis and upbeat corporate earnings results lifted market sentiment. Dow and S&P 500 futures rose about 0.1%, while Nasdaq 100 futures advanced 0.3%. In regular trading on Thursday, the S&P 500 climbed 0.94% and the Nasdaq Composite jumped 1.21%, with both benchmarks hitting their highest levels since August, while the Dow rose 0.34%. Seven out of the 11 S&P sectors finished higher, led to the upside by technology, communication services and consumer discretionary. Investors continued to monitor negotiations on the US debt ceiling, with House Speaker Kevin McCarthy suggesting a potential deal could come as soon as next week. Positive corporate updates from major firms also boosted sentiment, with Nvidia surging nearly 5% after announcing it joined ServiceNow to build AI for enterprises.
Comment:
Gold (XAU/USD): Support at $1,949 on the Radar
The price of spot gold in $ terms concluded last week down -1.7%, following the precious metal topping a whisker south of the all-time high of $2,075 in early May (a move aided by negative divergence out of the Relative Strength Index ). Based on the weekly timeframe, I see limited support (the $1,949 region appears soft on this chart), meaning the yellow metal could experience further losses over the coming weeks, targeting support from $1,807. However, this does not mean the $1,949 area should be disregarded as potential support.
Across the page on the daily timeframe, recent weakness propelled price action through the lower boundary of a local channel support taken from the low $1,934, and the 50-day simple moving average, currently fluctuating around $1,987. Underpinned by dollar weakness on Friday, XAU/USD did manage to eke out a gain ahead of $1,949 and landed the unit at the underside of the 50-day simple moving average to end the week. You can see on the daily chart that $1,949 support, marked on both the weekly and daily timeframes, is bolstered by a longer-term ascending channel support drawn from the low $1,616. Therefore, there may still be weight behind $1,949.
Shorter term, following the rebound from support at $1,955, the precious metal ended Friday completing an ‘alternate’ AB=CD bearish configuration, denoted by the 1.618% Fibonacci projection at $1,984, which shares chart space with a nearby resistance level. The completion of this pattern is likely to see AB=CD shorts target the 38.2% and 61.8% Fibonacci retracement ratios at $1,971 and $1,964, respectively (derived from legs A-D). Further selling from here would then chalk up the possibility of targeting the higher timeframe support at $1,949.
Venturing higher this week, however, could have H1 resistance at $1,991 welcome price action, with subsequent buying shifting attention back to the widely watched $2,000 level.
The price of spot gold in $ terms concluded last week down -1.7%, following the precious metal topping a whisker south of the all-time high of $2,075 in early May (a move aided by negative divergence out of the Relative Strength Index ). Based on the weekly timeframe, I see limited support (the $1,949 region appears soft on this chart), meaning the yellow metal could experience further losses over the coming weeks, targeting support from $1,807. However, this does not mean the $1,949 area should be disregarded as potential support.
Across the page on the daily timeframe, recent weakness propelled price action through the lower boundary of a local channel support taken from the low $1,934, and the 50-day simple moving average, currently fluctuating around $1,987. Underpinned by dollar weakness on Friday, XAU/USD did manage to eke out a gain ahead of $1,949 and landed the unit at the underside of the 50-day simple moving average to end the week. You can see on the daily chart that $1,949 support, marked on both the weekly and daily timeframes, is bolstered by a longer-term ascending channel support drawn from the low $1,616. Therefore, there may still be weight behind $1,949.
Shorter term, following the rebound from support at $1,955, the precious metal ended Friday completing an ‘alternate’ AB=CD bearish configuration, denoted by the 1.618% Fibonacci projection at $1,984, which shares chart space with a nearby resistance level. The completion of this pattern is likely to see AB=CD shorts target the 38.2% and 61.8% Fibonacci retracement ratios at $1,971 and $1,964, respectively (derived from legs A-D). Further selling from here would then chalk up the possibility of targeting the higher timeframe support at $1,949.
Venturing higher this week, however, could have H1 resistance at $1,991 welcome price action, with subsequent buying shifting attention back to the widely watched $2,000 level.
Comment:
Monday happens nothing
tuesday
pmi important also for eurousd if euro gets stronger nasdaq and s+p500 and gold get stronger too
pmi for dollar at 9:45 watch closely and wait how the algos trade. Dont go immediately in,just be patient
also manufacturing data will be published. Important
Until the dat come out, the price moves higher or lower above/below the opening price ,but suddenly comes back to the opening level. No good idea to trade.
Wednesday 2p.m.: FOMC meeting, but this meeting is FOMC minute. High impact, but not so much as the real FOMC meeting,
10 a.m. Yellen will speak,
Thurseday: GDP,pending homesales,unemployment
Friday: Big Day,PCE coming out, also Durable goods
also consumer sentiments and inflation expectations.
Friday will be a very busy day. Watch for those data points.
tuesday
pmi important also for eurousd if euro gets stronger nasdaq and s+p500 and gold get stronger too
pmi for dollar at 9:45 watch closely and wait how the algos trade. Dont go immediately in,just be patient
also manufacturing data will be published. Important
Until the dat come out, the price moves higher or lower above/below the opening price ,but suddenly comes back to the opening level. No good idea to trade.
Wednesday 2p.m.: FOMC meeting, but this meeting is FOMC minute. High impact, but not so much as the real FOMC meeting,
10 a.m. Yellen will speak,
Thurseday: GDP,pending homesales,unemployment
Friday: Big Day,PCE coming out, also Durable goods
also consumer sentiments and inflation expectations.
Friday will be a very busy day. Watch for those data points.
Comment:
This week:
s+p500
4193 to 4180 should be filled. I am looking bearish this week until sp500 goes to around 4160.
There I will be prepared for a buy, if volume sinks, and we have a bullish signal. The volume has to be increase, while the price gos up again.
If not so, it could mean, that important news, what the public does not know will arrive soon.In this case I willstay out.
If we have buy presure, the target will be 4180, we hold above it, we go then to 4223, and then 4277, cuz there no resistance
Nasdaq US100
Big LVN zone 13563-13606 and a single close at 13689 and 13750
I am expecting that coming down and correction.No! I want to have this correction, before US100 begins a big buy pressure at this level and rise higher.
My bullish target will be then 13952,13999,14218 and 14298
There we have nearly no resistances
In case US100 falls below 13606,
it nears of 13518 but latestly 13350. There are my next Bulls waiting to welcome the bears and support the strong Buy pressure.
Bitcoin.Possibly will come down to 2395 area before the Buying pressure begins.
It has to go above 27700. If we start sideways and the volume reducing, I will take the first Profits, and wait for a second ,but powerfull bullish run.
Then we had the pullback to 38,2 Fib which is a bullflag level,
We pushed then the high ,and higher highs which was wonderful
Gold: we had very strong impulse from 1618 to 1973
Then we had the pullback to 38,2 Fib which is a bullflag level,
We pushed then the high ,and higher highs which was wonderful
The profit taking on the Highs put back Gold in a correction mode,
I am expecting Gold will come down to 1900-1936 (62%Fib.) and then we attack 2150, and then 2212.5
Important is: Gold must Close this week above 1900-1920.
If it doesn´t and falls below this level, then we will see 1840 agin. It will be a ull trend, ,but it will need longer to climb higher.
If we close above 1920 this Friday, then possibly in the next 14 Days Gold will RISE HIGHER...
s+p500
4193 to 4180 should be filled. I am looking bearish this week until sp500 goes to around 4160.
There I will be prepared for a buy, if volume sinks, and we have a bullish signal. The volume has to be increase, while the price gos up again.
If not so, it could mean, that important news, what the public does not know will arrive soon.In this case I willstay out.
If we have buy presure, the target will be 4180, we hold above it, we go then to 4223, and then 4277, cuz there no resistance
Nasdaq US100
Big LVN zone 13563-13606 and a single close at 13689 and 13750
I am expecting that coming down and correction.No! I want to have this correction, before US100 begins a big buy pressure at this level and rise higher.
My bullish target will be then 13952,13999,14218 and 14298
There we have nearly no resistances
In case US100 falls below 13606,
it nears of 13518 but latestly 13350. There are my next Bulls waiting to welcome the bears and support the strong Buy pressure.
Bitcoin.Possibly will come down to 2395 area before the Buying pressure begins.
It has to go above 27700. If we start sideways and the volume reducing, I will take the first Profits, and wait for a second ,but powerfull bullish run.
Then we had the pullback to 38,2 Fib which is a bullflag level,
We pushed then the high ,and higher highs which was wonderful
Gold: we had very strong impulse from 1618 to 1973
Then we had the pullback to 38,2 Fib which is a bullflag level,
We pushed then the high ,and higher highs which was wonderful
The profit taking on the Highs put back Gold in a correction mode,
I am expecting Gold will come down to 1900-1936 (62%Fib.) and then we attack 2150, and then 2212.5
Important is: Gold must Close this week above 1900-1920.
If it doesn´t and falls below this level, then we will see 1840 agin. It will be a ull trend, ,but it will need longer to climb higher.
If we close above 1920 this Friday, then possibly in the next 14 Days Gold will RISE HIGHER...
Comment:
Friday26.May is the Big Day of this week
US Stocks Lack Direction as Investors Eye Debt Ceiling and Inflation report
the yield on the US 10-year Treasury note rebounded from early losses to trade slightly higher at 3.7%, the highest since mid-March, as traders assess the monetary policy outlook and the debt ceiling impasse in the US. On Monday, Fed’s Kashkari said a June rate pause or hike is a close call and St. Louis Fed President Bullard said the Fed may still need to raise rates by another half-point this year. Last Friday, Fed Chair Powell mentioned that because of stress in the banking sector, it might be unnecessary to further raise rates to curb inflation. The likelihood of a pause in the rate hike cycle has been fluctuating, but currently, traders are assigning a 78% probability that the Fed will maintain the rates steady in June. Simultaneously, President Biden is scheduled to meet with House Speaker Kevin McCarthy on Monday to continue negotiations regarding the debt ceiling. This follows an unsuccessful meeting between key negotiators on Friday.
US stocks traded around the flatline on Monday, as investors remain concerned about the sustainability of US government debt. President Biden and House Speaker Kevin McCarthy are set to continue negotiations on the debt ceiling today following a failed meeting on Friday. Treasury Secretary Yellen said on Sunday that the likelihood of the Treasury paying all US bills by June 15th is quite low. Meanwhile, traders continue to follow comments from several Fed officials: Fed’s Kashkari said a June rate pause or hike is a close call and St. Louis Fed President Bullard said the Fed may still need to raise rates by another half-point this year. On the corporate front, shares of Micron Technology fell nearly 4% after China banned some Chinese tech manufacturers from using the company's chips. Stocks of Apple were also down about 1% after Loop Capital downgraded its stock to hold from buy. Meta stocks were also under pressure after the firm has been fined by European regulators.
US futures were around the flatline on Monday, as investors remain concerned about the sustainability of US government debt. President Biden and House Speaker Kevin McCarthy are set to continue negotiations on the debt ceiling today following a failed meeting on Friday. Meanwhile, Treasury Secretary Janet Yellen said on Sunday that the likelihood of the Treasury paying all US bills by June 15th is quite low. On the corporate front, shares of Micron Technology fell more than 4% in premarket trading after China banned some Chinese tech manufacturers from using the company's chips. Stocks of Apple were also down about 1% after Loop Capital downgraded the company’s stock to hold from buy. Meta stocks lost nearly 1% after the firm has been fined a record €1.2 billion by European privacy regulators.
US Stocks Lack Direction as Investors Eye Debt Ceiling and Inflation report
the yield on the US 10-year Treasury note rebounded from early losses to trade slightly higher at 3.7%, the highest since mid-March, as traders assess the monetary policy outlook and the debt ceiling impasse in the US. On Monday, Fed’s Kashkari said a June rate pause or hike is a close call and St. Louis Fed President Bullard said the Fed may still need to raise rates by another half-point this year. Last Friday, Fed Chair Powell mentioned that because of stress in the banking sector, it might be unnecessary to further raise rates to curb inflation. The likelihood of a pause in the rate hike cycle has been fluctuating, but currently, traders are assigning a 78% probability that the Fed will maintain the rates steady in June. Simultaneously, President Biden is scheduled to meet with House Speaker Kevin McCarthy on Monday to continue negotiations regarding the debt ceiling. This follows an unsuccessful meeting between key negotiators on Friday.
US stocks traded around the flatline on Monday, as investors remain concerned about the sustainability of US government debt. President Biden and House Speaker Kevin McCarthy are set to continue negotiations on the debt ceiling today following a failed meeting on Friday. Treasury Secretary Yellen said on Sunday that the likelihood of the Treasury paying all US bills by June 15th is quite low. Meanwhile, traders continue to follow comments from several Fed officials: Fed’s Kashkari said a June rate pause or hike is a close call and St. Louis Fed President Bullard said the Fed may still need to raise rates by another half-point this year. On the corporate front, shares of Micron Technology fell nearly 4% after China banned some Chinese tech manufacturers from using the company's chips. Stocks of Apple were also down about 1% after Loop Capital downgraded its stock to hold from buy. Meta stocks were also under pressure after the firm has been fined by European regulators.
US futures were around the flatline on Monday, as investors remain concerned about the sustainability of US government debt. President Biden and House Speaker Kevin McCarthy are set to continue negotiations on the debt ceiling today following a failed meeting on Friday. Meanwhile, Treasury Secretary Janet Yellen said on Sunday that the likelihood of the Treasury paying all US bills by June 15th is quite low. On the corporate front, shares of Micron Technology fell more than 4% in premarket trading after China banned some Chinese tech manufacturers from using the company's chips. Stocks of Apple were also down about 1% after Loop Capital downgraded the company’s stock to hold from buy. Meta stocks lost nearly 1% after the firm has been fined a record €1.2 billion by European privacy regulators.
Comment:
Gold Markets Continue to Build a Base
Gold markets have gone back and forth during the trading session on Monday as we continue to see the 50-Day EMA just above offer resistance.
as we see the 50-Day EMA above offer quite a bit of resistance. If we were to break above there, then it’s likely that we could go looking to the $2000 level, which is a large, round, psychologically significant figure. However, we have chopped through that multiple times, and therefore it’s likely that we could see a lot of indecision in that area, but ultimately it’s also possible that we could see less trouble breaking through it again.
The market will continue to see an overall buy on the dip type of attitude, but with that being said I think we’ve got a lot of noise ahead of us, and therefore I think you need to be cautious with your position size. That being said, I certainly have no interest whatsoever in trying to short this market, and the massive uptrend line will also cause a bit of support. All things being equal, this is a market that I do think continues to go higher based on the idea that a lot of people out there are looking for wealth preservation, and of course gold is crucial.
On the other hand, if we break down below the $1950 level, then it’s possible that we go down to the 200 day EMA. That of course is an indicator that will attract a lot of attention, especially as it will more likely than not be closer to the $1900 level if that does in fact happen. With that in mind, I like the idea of going long, especially if we can turn around and break above the 50-Day EMA, but it is worth noting that the longer we sit in this area, the more stable the market becomes, which of course is more attractive to bulls as it can give them a little bit of comfort in a market that offers wealth preservation. Ultimately, I do think that we retest the highs that we made recently, so I think if you are cautious enough, you will find value in this market.
Gold markets have gone back and forth during the trading session on Monday as we continue to see the 50-Day EMA just above offer resistance.
as we see the 50-Day EMA above offer quite a bit of resistance. If we were to break above there, then it’s likely that we could go looking to the $2000 level, which is a large, round, psychologically significant figure. However, we have chopped through that multiple times, and therefore it’s likely that we could see a lot of indecision in that area, but ultimately it’s also possible that we could see less trouble breaking through it again.
The market will continue to see an overall buy on the dip type of attitude, but with that being said I think we’ve got a lot of noise ahead of us, and therefore I think you need to be cautious with your position size. That being said, I certainly have no interest whatsoever in trying to short this market, and the massive uptrend line will also cause a bit of support. All things being equal, this is a market that I do think continues to go higher based on the idea that a lot of people out there are looking for wealth preservation, and of course gold is crucial.
On the other hand, if we break down below the $1950 level, then it’s possible that we go down to the 200 day EMA. That of course is an indicator that will attract a lot of attention, especially as it will more likely than not be closer to the $1900 level if that does in fact happen. With that in mind, I like the idea of going long, especially if we can turn around and break above the 50-Day EMA, but it is worth noting that the longer we sit in this area, the more stable the market becomes, which of course is more attractive to bulls as it can give them a little bit of comfort in a market that offers wealth preservation. Ultimately, I do think that we retest the highs that we made recently, so I think if you are cautious enough, you will find value in this market.
Comment:
The dollar index steadied around 103.3 on Tuesday, supported by growing expectations that the Federal Reserve will keep interest rates higher for longer, while traders cautiously awaited updates from the debt ceiling negotiations. In the latest central bank commentary, Fed’s Bullard suggested the possibility of raising rates by another half-point this year, while Fed's Kashkari described the decision to pause or hike rates in June as a close call. Markets have scaled back bets on interest rate cuts this year, with rates seen holding at around 4.7% by December. Meanwhile, President Joe Biden and House Speaker Kevin McCarthy signaled cautious optimism that a deal to raise the debt ceiling would be reached, with Treasury Secretary Janet Yellen reaffirming that the US could be at risk of default by June 1.
Comment:
All Eyes on Friday.
1877-1902 Very strong Bullish Support area. Below thi level the markt can Fall immediately and very fast to 1764 if the macroeconomic conditions change rapidly, but at around 1700 the Bulls are waiting. If the Market considates around 1900 ,the bulls will develope stronger pressure. Resistance Zone: 1996-2026, If theGold holds above , 2200 will be reached very soon.
1877-1902 Very strong Bullish Support area. Below thi level the markt can Fall immediately and very fast to 1764 if the macroeconomic conditions change rapidly, but at around 1700 the Bulls are waiting. If the Market considates around 1900 ,the bulls will develope stronger pressure. Resistance Zone: 1996-2026, If theGold holds above , 2200 will be reached very soon.
Comment:
Gold is mostly flat while traders wait for catalysts. Debt ceiling negotiations are expected to resume today, but it remains to be seen whether parties will reach consensus this week.
In case gold climbs above the $1980 level, it will head towards the resistance at $2000. On the support side, a move below $1965 will push gold towards the support at $1950.
R1:$1980 – R2:$2000 – R3:$2010
S1:$1965 – S2:$1950 – S3:$1930
Gold, Silver, Platinum – Silver Pulls Back As Traders Wait For Debt Ceiling Negotiations
In case gold climbs above the $1980 level, it will head towards the resistance at $2000. On the support side, a move below $1965 will push gold towards the support at $1950.
R1:$1980 – R2:$2000 – R3:$2010
S1:$1965 – S2:$1950 – S3:$1930
Gold, Silver, Platinum – Silver Pulls Back As Traders Wait For Debt Ceiling Negotiations
Comment:
Gold Markets Continue to Stabilize
Comment:
-0.80%
Gold, FX Empire
Gold Price Predictions Video for 25.05.23
Play
Gold Market Technical Analysis
Gold markets have rallied slightly during the trading session on Wednesday, to reach toward the 50-Day EMA. In fact, the market even broke above there, only to turn around and show signs of hesitation.
Gold, FX Empire
Gold Price Predictions Video for 25.05.23
Play
Gold Market Technical Analysis
Gold markets have rallied slightly during the trading session on Wednesday, to reach toward the 50-Day EMA. In fact, the market even broke above there, only to turn around and show signs of hesitation.
Comment:
Keep in mind that gold has been very noisy as of late, therefore I think we will continue to see a lot of volatility. It’s also worth noting that the uptrend line underneath should continue to offer support. Alternatively, the $1950 level probably offers support as well, so I think it all comes together quite nicely for a potential bounce.
Comment:
a move above the 50-Day EMA could open up the possibility of a move to the $2000 level. After that, then we have the $2010 level, which is where we have a significant short-term uptrend line that has been broken and should now offer resistance.
If we can break above there, then it’s likely that we could see a move toward the $2060 level. Gold should continue to attract a lot of attention, and now that we have had a short-term pullback, it has people looking for value.
If we can break above there, then it’s likely that we could see a move toward the $2060 level. Gold should continue to attract a lot of attention, and now that we have had a short-term pullback, it has people looking for value.
Comment:
If we break down below the $1950 level, then it’s possible that we could go look into the $1900 level underneath. The $1900 level also features the 200-Day EMA that could offer support, so that would be where your overall trend defining indicators set
Comment:
Anything below there opens up the possibility of a rather steep decline, and in turn probably a very strong US dollar.
Comment:
Selling Pressure,Weakenning of UsDollar, thats good for Euro. Strong Euro is GOOD,no VERY GOOD for SP500;NASDAQ;DOW JONES; GOLD;BITCOIN;CRYPTOS: Everything against Dollar.
Look also my NVIDIA Forecast Chart performed: Nailed it! Weak US DOllar also good for Tech Stocks, Bio Pharma and Tech have Highly positive correltions with Bitcoin and Ethereum, and vice versa. NVIDIA : Top Performer
Friday is the Big Day of the Week: aND IT WILL BE VERY BUISY. RGHT AFTER THE bELL PMI and Inflation DATA!
Look also my NVIDIA Forecast Chart performed: Nailed it! Weak US DOllar also good for Tech Stocks, Bio Pharma and Tech have Highly positive correltions with Bitcoin and Ethereum, and vice versa. NVIDIA : Top Performer
Friday is the Big Day of the Week: aND IT WILL BE VERY BUISY. RGHT AFTER THE bELL PMI and Inflation DATA!
Comment:
De-dollarisation: the yuan’s use grows, but the greenback’s global role is proving to be stubborn
Focus remained chiefly on negotiations among lawmakers over raising the U.S. spending limit, although neither Democrat nor Republican negotiators offered any cues on when a deal could be reached.
Focus remained chiefly on negotiations among lawmakers over raising the U.S. spending limit, although neither Democrat nor Republican negotiators offered any cues on when a deal could be reached.
Comment:
Poland Steps Up Gold Buying
Comment:
he National Bank of Poland added nearly 15 tons of gold to its reserves in April, according to data published by the bank last week. It was the largest increase in the country’s reserves since June 2019 when the bank boosted reserves by almost 100 tons. The purchase increased the value of Poland’s gold reserves from $14.55 billion to $15.52 billion. Poland’s official gold holdings rank as the 22nd largest in the world. Gold makes up about 8.5% of the Bank of Poland’s total reserves.
Comment:
Gold first targeting the 1,944 region, which would complete a 50% retracement
(untested Lows inbalanced-Test)
(untested Lows inbalanced-Test)
Comment:
A little lower is the 100-Day EMA trend indicator at 1,934. In three days the 100-Day line will converge with the long-term uptrend line thereby adding a degree of significance to support around the area of the uptrend line and 100-Day EMA.
Comment:
Big Support at 1894-1926.Sellers sitting belowv 1884.
Buyers accumulation 1769-1807: If They lose control of this zone, a bear trend can be created. As long as the price is above this zone,old is in an uptrend.
Buyers accumulation 1769-1807: If They lose control of this zone, a bear trend can be created. As long as the price is above this zone,old is in an uptrend.
Comment:
Market UpDATES:
NASDQ100 US100 and Indices Sky Rocketing after FED pivot reates cooling
Nasdaq breaking 14055 easily as forecasted in my analysis : Next Target 14350
NVIDAI Sky ROCKETING(Watch als my other Forecasts USD/US100/USDJPY/GOLD/EURO- Related Markets)
Godl Found More Buyers on support.More Bullish Delat coming in nEXT TO 2000USD)
Medium-term price action on the daily chart exhibits scope to extend losses. The longer-term ascending channel is interesting (drawn from $1,641 and $1,959). Note that price action FAILED to touch gloves with the upper boundary in recent trading, pencilling in highs just ahead of the all-time high of $2,075.
Investment Sentiment rising higher from Lows:More Bulls
The Key Fed Inflation Rate Is Cooling At Pivotal Time For The S&P 500
EURO/USD Taking Profits +More Bulls Accumulation and Buying Pressure /Support 1,4075
NASDQ100 US100 and Indices Sky Rocketing after FED pivot reates cooling
Nasdaq breaking 14055 easily as forecasted in my analysis : Next Target 14350
NVIDAI Sky ROCKETING(Watch als my other Forecasts USD/US100/USDJPY/GOLD/EURO- Related Markets)
Godl Found More Buyers on support.More Bullish Delat coming in nEXT TO 2000USD)
Medium-term price action on the daily chart exhibits scope to extend losses. The longer-term ascending channel is interesting (drawn from $1,641 and $1,959). Note that price action FAILED to touch gloves with the upper boundary in recent trading, pencilling in highs just ahead of the all-time high of $2,075.
Investment Sentiment rising higher from Lows:More Bulls
The Key Fed Inflation Rate Is Cooling At Pivotal Time For The S&P 500
EURO/USD Taking Profits +More Bulls Accumulation and Buying Pressure /Support 1,4075
Comment:
strong buy signal on 2H
Comment:
Bitcoin price climbs above $26,800 as traders eye resistance at $27,600
The durable goods number, personal spending, and the PCE inflation measures were all broadly above expectations
The durable goods number, personal spending, and the PCE inflation measures were all broadly above expectations
Comment:
The gold price on Friday pulled back off the session highs of about $1,957 to trade at about $1,945 following the latest round of data. The price of the yellow metal seems to be trading within a descending channel formation in the 60-min chart. The gold price has now fallen to trade a few levels below the 100-hour moving average line. As a result, gold seems to have shifted closer to the oversold levels of the 14-hour RSI. From a fundamental perspective, the gold price is trading at the back of a relatively busy period in the US market.
Comment:
momentum bullissh increasing
Comment:
US equity futures and Asian shares advanced as appetite for risk taking returned to global markets following the deal between President Joe Biden and House Speaker Kevin McCarthy on the US debt ceiling. Contracts for the S&P 500 rose about 0.3% in Asia on Monday
Comment:
XAU/USD turns volatile after facing barricades around $1,950 amid hawkish Fed bets
Comment:
Gold price has faced selling pressure around $1,948.00 as the Fed could raise interest rates further.
US President Joe Biden is scheduled to deliver remarks on the budget agreement at 10:25 GMT.
Gold price has turned imbalance after a breakdown of the consolidation formed in a range of $1,952-1,985.
US President Joe Biden is scheduled to deliver remarks on the budget agreement at 10:25 GMT.
Gold price has turned imbalance after a breakdown of the consolidation formed in a range of $1,952-1,985.
Comment:
Gold price has turned imbalance after a breakdown of the consolidation formed in a range of $1,952-1,985 on the daily scale. The precious metal has shifted into bearish territory and is expected to find immediate support near March 22 low at $1,934.34. After a breakdown of the March 22 low, the Gold price would get exposed to February 09 high at $1,890.27.
Comment:
S1 1923
s2 1833
long
US Futures Rise as Debt Ceiling Deal ReachedUS stock futures rose on Tuesday after the Biden administration and Republican lawmakers reached a tentative deal on raising the US debt ceiling, removing a source of uncertainty in the markets. Nasdaq 100 futures jumped 0.4%, S&P 500 futures gained 0.3% and Dow futures added 0.2%. President Biden and House Speaker Kevin McCarthy reached a tentative deal in a phone call late on Saturday and showed confidence it would pass in Congress. The bill will suspend the debt ceiling until January 1, 2025, and federal spending will be capped for the next two years. US stock and bond markets were closed Monday for the Memorial Day holiday. Investors now look ahead to a fresh batch of economic data this week including the May jobs report and the ISM Manufacturing PMI.
s2 1833
long
US Futures Rise as Debt Ceiling Deal ReachedUS stock futures rose on Tuesday after the Biden administration and Republican lawmakers reached a tentative deal on raising the US debt ceiling, removing a source of uncertainty in the markets. Nasdaq 100 futures jumped 0.4%, S&P 500 futures gained 0.3% and Dow futures added 0.2%. President Biden and House Speaker Kevin McCarthy reached a tentative deal in a phone call late on Saturday and showed confidence it would pass in Congress. The bill will suspend the debt ceiling until January 1, 2025, and federal spending will be capped for the next two years. US stock and bond markets were closed Monday for the Memorial Day holiday. Investors now look ahead to a fresh batch of economic data this week including the May jobs report and the ISM Manufacturing PMI.
Comment:
Markets steady ahead of final push on the debt deal
After long weekends in many parts of the world, FX markets are returning to some progress on the US debt ceiling. President Joe Biden and House Speaker Kevin McCarthy have reached a two-year deal. That deal will be assessed by the House Rules Committee today and, if approved, will likely go to a vote in the House tomorrow. Both Democrat and Republican leaders feel they have the votes to get the deal through Congress – although at times like these, there may be a few holdout politicians who like their day in the sun.
After long weekends in many parts of the world, FX markets are returning to some progress on the US debt ceiling. President Joe Biden and House Speaker Kevin McCarthy have reached a two-year deal. That deal will be assessed by the House Rules Committee today and, if approved, will likely go to a vote in the House tomorrow. Both Democrat and Republican leaders feel they have the votes to get the deal through Congress – although at times like these, there may be a few holdout politicians who like their day in the sun.
Comment:
Iraq Boosts Gold Reserves by 2% in Single Day in Gradual Buildup
Iraq’s central bank boosted its gold reserves by about 2% in a single day last week as part of what it calls a gradual plan to stock up on the precious metal that’s seen as a traditional haven in times of economic distress. Iraq bought 2.5 tons of bullion on Thursday to bring its reserves to 132.73 tons, Mazin Sabah, director general of the central bank’s investments department, said in an interview in Baghdad. The strategy is to acquire more gold in the second half of the year, Sabah said. “Our current plan is to buy small quantities over multiple times, not a big quantity in one go,” Sabah said
Iraq’s central bank boosted its gold reserves by about 2% in a single day last week as part of what it calls a gradual plan to stock up on the precious metal that’s seen as a traditional haven in times of economic distress. Iraq bought 2.5 tons of bullion on Thursday to bring its reserves to 132.73 tons, Mazin Sabah, director general of the central bank’s investments department, said in an interview in Baghdad. The strategy is to acquire more gold in the second half of the year, Sabah said. “Our current plan is to buy small quantities over multiple times, not a big quantity in one go,” Sabah said
Comment:
Biden and House Speaker McCarthy reached an agreement on Saturday and the House vote is expected to take place on Wednesday. However, several Republicans have stated that they will not vote in favor of it. Most Ai stocks were still up after Nvidia rose as much as 4% earlier in the session, briefly hitting a $1 trillion market cap. Tesla also held gains after Elon Musk told Chinese foreign minister Qin Gang that he was willing to expand business in the country. On the other hand, energy stocks were among the worst performers dragged down by a 4% decline in oil prices.
Comment:
Gold’s Uptrend Line Tested as Support
Gold further tests the uptrend line as support as it dips below the line briefly early in the session to a new trend low of 1,932, before rallying to a three-day high. It is on track to complete the day at its highest daily close in at least four days. Support around the uptrend line is strengthened by its convergence with the 50% retracement and completion of a falling ABCD pattern with the CD target extended by 127.2% (1,943).
Gold further tests the uptrend line as support as it dips below the line briefly early in the session to a new trend low of 1,932, before rallying to a three-day high. It is on track to complete the day at its highest daily close in at least four days. Support around the uptrend line is strengthened by its convergence with the 50% retracement and completion of a falling ABCD pattern with the CD target extended by 127.2% (1,943).
Comment:
314-117: The House passes the Biden-McCarthy debt ceiling agreement, raising the debt limit until 2025 and instituting discretionary spending caps for two years.
71 Republicans and 46 Democrats voted “no” on the bill
71 Republicans and 46 Democrats voted “no” on the bill
Comment:
The Dow Jones cut early losses to trade around 50 points higher while the S&P 500 and the Nasdaq extended gains to add about 0.5% each, as traders focus on the monetary policy outlook. Fresh data for unit labour costs, the ISM PMI and comments from some Fed officials reinforced bets the Fed will pause the tightening cycle this month. As a result, Treasury yields fell and tech shares got a boost. On the other hand, stocks of Salesforce fell nearly 5% after the company reported higher capital expenses than expected. Meanwhile, traders welcomed the passage of the Fiscal Responsibility Act of 2023 by a vote of 314-117 on the House of Representatives. The bill is now headed to the Senate and is expected to be approved before the June 5th default deadline.
The dollar index fell below 103.9 on Thursday, the lowest in nearly a week, as fresh data and comments from some Fed officials raised bets the central bank will pause the tightening cycle when it meets in about two weeks. Unit labour costs rose less than expected in Q1 and the slump in productivity was revised lower, while the ISM PMI showed the manufacturing sector contracted for a 7th month. On the other hand, initial jobless claims and the ADP report beat forecasts. Also, Fed Governor Philip Jefferson and Philadelphia Fed President Patrick Harker suggested the central bank would skip a rate hike in the next meeting. Meanwhile, the House of Representatives approved the Fiscal Responsibility Act of 2023 by a vote of 314-117 on Wednesday evening. The bill is now headed to the Senate and is expected to be approved before the June 5th default deadline.
The dollar index fell below 103.9 on Thursday, the lowest in nearly a week, as fresh data and comments from some Fed officials raised bets the central bank will pause the tightening cycle when it meets in about two weeks. Unit labour costs rose less than expected in Q1 and the slump in productivity was revised lower, while the ISM PMI showed the manufacturing sector contracted for a 7th month. On the other hand, initial jobless claims and the ADP report beat forecasts. Also, Fed Governor Philip Jefferson and Philadelphia Fed President Patrick Harker suggested the central bank would skip a rate hike in the next meeting. Meanwhile, the House of Representatives approved the Fiscal Responsibility Act of 2023 by a vote of 314-117 on Wednesday evening. The bill is now headed to the Senate and is expected to be approved before the June 5th default deadline.
Comment:
Fundamentals still favor higher commodity prices
Swiss gold exports fall to 10-month low amid sky-high prices
Swiss gold exports fall to 10-month low amid sky-high prices
Comment:
A break above 2052 will drive Gold to 2300 area
Comment:
Oscillators like the Relative Strength Index (RSI) and the 3-day Rate of Change (RoC) suggests sellers are in charge though a decisive break below $1950 would put them in the driver’s seat to challenge the 200-day EMA.
XAU/USD first support would be $1950, followed by the 100-day EMA at $1936.30. Once cleared, $1900 is up next. On the other hand, the XAU/USD first resistance would be the 50-day EMA at $1970.78, closely followed by the 20-day EMA at $1972.86. Upside risks lie at $2000.
XAU/USD first support would be $1950, followed by the 100-day EMA at $1936.30. Once cleared, $1900 is up next. On the other hand, the XAU/USD first resistance would be the 50-day EMA at $1970.78, closely followed by the 20-day EMA at $1972.86. Upside risks lie at $2000.
Comment:
New Jobs Report Takes Dollar, Yields Higher and Gold Sharply Lower
Gold and US Dollar Reaction to Employment Data
Gold prices fell sharply today after the BLS (Bureau of Labor Statistics) revealed that 339,000 new nonfarm payroll jobs were added last month, well above Wall Street estimates that predicted an increase in May of 190,000 new jobs. The report also showed that the unemployment rate rose from a 53-year low of 3.4% in April to 3.7% last month.
This created a strong bullish updraft in Treasury yields and the dollar resulting in a downdraft in dollar-priced bullion. However, it was selling pressure that was the strongest component in today’s price decline of both gold and silver. Spot gold lost $29.90 per ounce in trading today. This decline included -$20.80 the result of market participants actively selling, and -$9.10 the result of dollar strength according to the KGX (Kitco Gold Index).
Gold and US Dollar Reaction to Employment Data
Gold prices fell sharply today after the BLS (Bureau of Labor Statistics) revealed that 339,000 new nonfarm payroll jobs were added last month, well above Wall Street estimates that predicted an increase in May of 190,000 new jobs. The report also showed that the unemployment rate rose from a 53-year low of 3.4% in April to 3.7% last month.
This created a strong bullish updraft in Treasury yields and the dollar resulting in a downdraft in dollar-priced bullion. However, it was selling pressure that was the strongest component in today’s price decline of both gold and silver. Spot gold lost $29.90 per ounce in trading today. This decline included -$20.80 the result of market participants actively selling, and -$9.10 the result of dollar strength according to the KGX (Kitco Gold Index).
Comment:
The Fed meets next week and expectations of another rate increase are rising, particularly given the growing hopes the U.S. economy is headed for a 'soft landing' after Congress's approval last week of a debt ceiling deal that averts U.S. default.
The Fed enters its traditional blackout period this week, but there is more data to digest, including the ISM services PMI later Monday, which is expected to point to a still solid rate of expansion.
The Fed enters its traditional blackout period this week, but there is more data to digest, including the ISM services PMI later Monday, which is expected to point to a still solid rate of expansion.
Comment:
Nasdaq Bitcoin and Co. Bullish
Comment:
US100
long bullish
5min divergence long
5min. short DXY rips nasdaq bitcoin gold euro and co bullish
Unemployment 261K
long bullish
5min divergence long
5min. short DXY rips nasdaq bitcoin gold euro and co bullish
Unemployment 261K
Comment:
Gold Prices Rise Nearly 1%
Gold prices gained nearly 1% to approach $1960 an ounce on Thursday, benefitting from a slightly weaker dollar, after a higher-than-expected initial jobless claims reading raised concerns over the health of the US economy. Still, gold prices remain significantly below the near-record-high of $2,050 reached on May 5th, as traders are anticipating that interest rates will need to remain elevated for an extended period. This week, both the Reserve Bank of Australia and the Bank of Canada surprised markets by delivering another 25bps increase in borrowing costs. All eyes are now on the FOMC meeting next week, with nearly 72% of traders expecting the Fed to leave the fed funds rate on hold. Meanwhile, the ECB is set to increase interest rates further also next week.
Gold prices gained nearly 1% to approach $1960 an ounce on Thursday, benefitting from a slightly weaker dollar, after a higher-than-expected initial jobless claims reading raised concerns over the health of the US economy. Still, gold prices remain significantly below the near-record-high of $2,050 reached on May 5th, as traders are anticipating that interest rates will need to remain elevated for an extended period. This week, both the Reserve Bank of Australia and the Bank of Canada surprised markets by delivering another 25bps increase in borrowing costs. All eyes are now on the FOMC meeting next week, with nearly 72% of traders expecting the Fed to leave the fed funds rate on hold. Meanwhile, the ECB is set to increase interest rates further also next week.
Comment:
DXY Falls after Weekly Claims
The dollar index dropped to as low as 103.58 on Thursday after higher-than-anticipated weekly claims reduced expectations of an imminent interest rate hike by the Federal Reserve. Market participants anticipate that the Federal Reserve will temporarily halt its cycle of interest rate increases before resuming them in July, but unexpected rate hikes by the Reserve Bank of Australia and the Bank of Canada have increased the likelihood of a Federal Reserve rate hike already next week. Nevertheless, the Federal Reserve's decision could be influenced by the release of May's consumer inflation data, scheduled for a day before the central bank's meeting, which is projected to indicate a 0.3% increase in prices.
Initial Jobless Claims Jump to 2021-Highs
The number of Americans filing for unemployment benefits jumped to 261K in the week ended June 3rd 2023, the highest figure since October 2021, and above market forecasts of 235K. Figures for the previous week were revised slightly higher to 233K from an initial 232K. It marks a third consecutive week of increases in the number of initial jobless claims, in a sign the labour market strenght may be fading. The 4-week moving average which removes week-to-week volatility was 237.25K, an increase of 7.5K from the previous week. Based on unadjusted data, the largest increases in initial claims were in Ohio (6.345K), California (5.173K), and Minnesota (2.746K), while the largest decreases were in Connecticut (-2.35K) and NY (-1.243K). Meanwhile, continuing claims fell to 1757K from 1794K, below forecasts of 1800K.
The dollar index dropped to as low as 103.58 on Thursday after higher-than-anticipated weekly claims reduced expectations of an imminent interest rate hike by the Federal Reserve. Market participants anticipate that the Federal Reserve will temporarily halt its cycle of interest rate increases before resuming them in July, but unexpected rate hikes by the Reserve Bank of Australia and the Bank of Canada have increased the likelihood of a Federal Reserve rate hike already next week. Nevertheless, the Federal Reserve's decision could be influenced by the release of May's consumer inflation data, scheduled for a day before the central bank's meeting, which is projected to indicate a 0.3% increase in prices.
Initial Jobless Claims Jump to 2021-Highs
The number of Americans filing for unemployment benefits jumped to 261K in the week ended June 3rd 2023, the highest figure since October 2021, and above market forecasts of 235K. Figures for the previous week were revised slightly higher to 233K from an initial 232K. It marks a third consecutive week of increases in the number of initial jobless claims, in a sign the labour market strenght may be fading. The 4-week moving average which removes week-to-week volatility was 237.25K, an increase of 7.5K from the previous week. Based on unadjusted data, the largest increases in initial claims were in Ohio (6.345K), California (5.173K), and Minnesota (2.746K), while the largest decreases were in Connecticut (-2.35K) and NY (-1.243K). Meanwhile, continuing claims fell to 1757K from 1794K, below forecasts of 1800K.
Comment:
US Wholesale Inventories Fall for 2nd Month
Wholesale inventories in the US decreased 0.1% month-over-month in April 2023, less than earlier estimates of a 0.2% fall and following a downwardly revised 0.2% drop in March. Inventories fell for nondurables (-1.2% vs -0.5% in March), mostly drugs (-0.8%), apparel (-2.3%), and farm products (-7.1%). On the other hand stocks for durable goods rose 0.6% (vs a flat reading in March). Compared to a year earlier, wholesale inventories jumped 6.3%.
Wholesale inventories in the US decreased 0.1% month-over-month in April 2023, less than earlier estimates of a 0.2% fall and following a downwardly revised 0.2% drop in March. Inventories fell for nondurables (-1.2% vs -0.5% in March), mostly drugs (-0.8%), apparel (-2.3%), and farm products (-7.1%). On the other hand stocks for durable goods rose 0.6% (vs a flat reading in March). Compared to a year earlier, wholesale inventories jumped 6.3%.
Comment:
ADA, MATIC, SOL face the music as Robinhood delists tokens
Hours after Robinhood delisted ADA, MATIC, and SOL, the price action of the tokens was not what participants would have hoped for.
Ethereum continues to dominate the crypto sector, with increased TVL and notable growth on DEXs. NFT sector however, does not witness the same level of progress.
Should Shiba Inu traders be worried as Shibarium launch date remains uncertain
Solana prices dive 42% within a week, will there be a quick recovery
Solana nears an important resistance
Bitcoin’s Implied Volatility declined rapidly indicating the anticipation of low fluctuations of price from the options market.
Hours after Robinhood delisted ADA, MATIC, and SOL, the price action of the tokens was not what participants would have hoped for.
Ethereum continues to dominate the crypto sector, with increased TVL and notable growth on DEXs. NFT sector however, does not witness the same level of progress.
Should Shiba Inu traders be worried as Shibarium launch date remains uncertain
Solana nears an important resistance
Bitcoin’s Implied Volatility declined rapidly indicating the anticipation of low fluctuations of price from the options market.
Comment:
Asian Stock Market: Bulls and bears jostle at monthly top ahead of central bank decisions
Asia-Pacific shares grind near one-month highs amid cautious mood.
Softer Japan inflation, hopes of no PBOC rate hike underpin mildly positive risk appetite.
Holidays in Australia, light calendar elsewhere join pre-Fed anxiety to limit market moves.
Gold price is looking to extend Friday’s pullback from five-day highs of $1,973 on Monday. Despite the retreat, Gold price maintains its last week’s range, as investors turn cautious ahead of a big week, with eyes on the United States (US) Consumer Price Index (CPI) and US Federal Reserve policy announcements
USD/JPY strengthens beyond mid-139.00s on modest USD uptick, lacks bullish conviction
USD/CHF Price Analysis: Bounces off 200-SMA but recovery remains elusive below 0.9100
GBPUSD SHORT on hawkish FED
SHORT
DAX40 Will Rise much more Higher
LONG
Asia-Pacific shares grind near one-month highs amid cautious mood.
Softer Japan inflation, hopes of no PBOC rate hike underpin mildly positive risk appetite.
Holidays in Australia, light calendar elsewhere join pre-Fed anxiety to limit market moves.
Gold price is looking to extend Friday’s pullback from five-day highs of $1,973 on Monday. Despite the retreat, Gold price maintains its last week’s range, as investors turn cautious ahead of a big week, with eyes on the United States (US) Consumer Price Index (CPI) and US Federal Reserve policy announcements
USD/JPY strengthens beyond mid-139.00s on modest USD uptick, lacks bullish conviction
USD/CHF Price Analysis: Bounces off 200-SMA but recovery remains elusive below 0.9100
SHORT
DAX40 Will Rise much more Higher
LONG
Comment:
US Fed, BOJ, ECB Are Set to Announce Policies This Week
Comment:
US Stocks Rise Ahead Inflation, Fed
The Dow Jones rose 20 points on Monday, the S&P 500 was up 0.3% and the Nasdaq 0.4% as investors are hopeful that inflationary pressures would show further signs of easing, supporting the case for a pause in the Fed’s interest rate hikes this week. The US inflation rate is forecasted to fall 4.1% in May, the lowest since March 2021, from 4.9% in April while the core gauge may decelerate to 5.2% from 5.5%. Most market participants expect the US central bank to leave interest rates unchanged at the current levels but there is a 30% chance of a rate hike depending on the CPI reading and after surprise moves in Australia and Canada last week. Among single stocks, Nasdaq tumbled 10% after the exchange operator said it agreed to acquire Adenza. Oracle was up nearly 4% ahead of earnings results after the market close
Crude Short oil make another bearish attempt
SHORT
BITCOIN WILL RISE HIGHER
LONG
Bank of Japan's Dovish Line Pushes Yen Down
LONG
GOLD STRONG BUY , short term correction coming soon
LONG
USD/CAD continues to move higher amid a broad sell-off in commod
LONG
USDCHF BEARISH Meets monthly Low and Support
SHORT
US100 Long U.S. Debt Deal Optimism Boosts Sentiment
LONG
The Dow Jones rose 20 points on Monday, the S&P 500 was up 0.3% and the Nasdaq 0.4% as investors are hopeful that inflationary pressures would show further signs of easing, supporting the case for a pause in the Fed’s interest rate hikes this week. The US inflation rate is forecasted to fall 4.1% in May, the lowest since March 2021, from 4.9% in April while the core gauge may decelerate to 5.2% from 5.5%. Most market participants expect the US central bank to leave interest rates unchanged at the current levels but there is a 30% chance of a rate hike depending on the CPI reading and after surprise moves in Australia and Canada last week. Among single stocks, Nasdaq tumbled 10% after the exchange operator said it agreed to acquire Adenza. Oracle was up nearly 4% ahead of earnings results after the market close
Crude Short oil make another bearish attempt
SHORT
BITCOIN WILL RISE HIGHER
LONG
Bank of Japan's Dovish Line Pushes Yen Down
LONG
GOLD STRONG BUY , short term correction coming soon
LONG
USD/CAD continues to move higher amid a broad sell-off in commod
LONG
USDCHF BEARISH Meets monthly Low and Support
SHORT
US100 Long U.S. Debt Deal Optimism Boosts Sentiment
LONG
Comment:
US100
long
nasdaq100 us100 we go to 15200 where the profit taking and reveras begins US100 Long Rises Higher to 15200zone,the possible correction
US100
long nasdaq100 us100 we go to 15200 where the profit taking and reveras begins US100 Long Rises Higher to 15200zone,the possible correction
Comment:
US Dollar Index: DXY fades recovery below 104.00 on downbeat Fed bets, US inflation eyed
US Dollar Index struggles to extend the previous day’s corrective bounce off three-week low, snaps two-day winning streak.
Markets remain nearly sure of witnessing no rate hike from Fed in June but concerns about July stay dicey.
Bond market moves, challenges to sentiment prod DXY bears ahead of the key US CPI.
Core CPI will be closely observed as high inflation can allow FOMC to remain hawkish despite no rate hike decision.
US Dollar Index (DXY) remains pressured around 103.60 as it fades the previous two-day winning streak on Tuesday as the key US inflation data looms. That said, the greenback’s gauge versus the six major currencies rose in the last two consecutive days amid the market’s positioning for the Federal Reserve’s (Fed) pause to the rate hike trajectory. However, the recently mixed concerns about the US central bank’s future moves join the challenges to the sentiment to prod the DXY buyers ahead of an important data point for the markets.
It’s worth noting that a study from the San Francisco Fed about the correlation between wage growth and inflation could be cited as the reason for the US central bank to remain less hawkish, which in turn weighs on the DXY, apart from the pre-data anxiety. The survey concluded that wage growth has a very small impact on inflation, which in turn raises doubts about the central bankers’ emphasis on wage cost numbers as a source of information to gauge inflation pressure.
Talking about the latest challenges to sentiment, a trade dispute is developing after the US expands its ban on imports from Xinjiang. China vows to protect China firms against any US sanctions, per Reuters. Recently, Bloomberg released prepared remarks of US Treasury Secretary Janet Yellen’s scheduled Testimony in front of the House Financial Services Committee as she said that the International Monetary Fund (IMF) and the World Bank (WB) serve as important counterweights to nontransparent, unsustainable lending from others, like China.
Additionally, the increase in the bets favoring the Federal Reserve’s (Fed) 0.25% rate hike in July also prod optimism and put a floor under the US Dollar Index. It should be noted that the CME’s FedWatch Tool suggests nearly limited scope for the US central bank to act on Wednesday’s Federal Open Market Committee (FOMC).
Looking ahead, the US Consumer Price Index (CPI) figures for May will be in the spotlight as the Fed decision looms on Wednesday. That said, the market forecasts of witnessing no change in the Core CPI MoM figure of 0.4% gain major attention as softer figures could push back the July rate hike concerns and may not allow the Fed to sound hawkish, which in turn can drown the US Dollar.
US Dollar Index struggles to extend the previous day’s corrective bounce off three-week low, snaps two-day winning streak.
Markets remain nearly sure of witnessing no rate hike from Fed in June but concerns about July stay dicey.
Bond market moves, challenges to sentiment prod DXY bears ahead of the key US CPI.
Core CPI will be closely observed as high inflation can allow FOMC to remain hawkish despite no rate hike decision.
US Dollar Index (DXY) remains pressured around 103.60 as it fades the previous two-day winning streak on Tuesday as the key US inflation data looms. That said, the greenback’s gauge versus the six major currencies rose in the last two consecutive days amid the market’s positioning for the Federal Reserve’s (Fed) pause to the rate hike trajectory. However, the recently mixed concerns about the US central bank’s future moves join the challenges to the sentiment to prod the DXY buyers ahead of an important data point for the markets.
It’s worth noting that a study from the San Francisco Fed about the correlation between wage growth and inflation could be cited as the reason for the US central bank to remain less hawkish, which in turn weighs on the DXY, apart from the pre-data anxiety. The survey concluded that wage growth has a very small impact on inflation, which in turn raises doubts about the central bankers’ emphasis on wage cost numbers as a source of information to gauge inflation pressure.
Talking about the latest challenges to sentiment, a trade dispute is developing after the US expands its ban on imports from Xinjiang. China vows to protect China firms against any US sanctions, per Reuters. Recently, Bloomberg released prepared remarks of US Treasury Secretary Janet Yellen’s scheduled Testimony in front of the House Financial Services Committee as she said that the International Monetary Fund (IMF) and the World Bank (WB) serve as important counterweights to nontransparent, unsustainable lending from others, like China.
Additionally, the increase in the bets favoring the Federal Reserve’s (Fed) 0.25% rate hike in July also prod optimism and put a floor under the US Dollar Index. It should be noted that the CME’s FedWatch Tool suggests nearly limited scope for the US central bank to act on Wednesday’s Federal Open Market Committee (FOMC).
Looking ahead, the US Consumer Price Index (CPI) figures for May will be in the spotlight as the Fed decision looms on Wednesday. That said, the market forecasts of witnessing no change in the Core CPI MoM figure of 0.4% gain major attention as softer figures could push back the July rate hike concerns and may not allow the Fed to sound hawkish, which in turn can drown the US Dollar.
Comment:
US Dollar Index: DXY licks US inflation-inflicted wounds at three-week low above 103.00 on Fed day
US Dollar Index grinds near the lowest levels in three weeks after snapping two-day winning streak.
US inflation data bolsters market’s bets on Fed’s status quo and weigh on the DXY despite upbeat yields.
Cautious mood ahead of the FOMC announcements put a floor under the US Dollar price.
Expectations of witnessing a hawkish halt from US central bank highlight qualitative updates from the Fed.
US Dollar Index (DXY) steadies above 103.00, after bouncing off a three-week low, as markets brace for the Federal Reserve (Fed) announcements on Wednesday. The greenback’s gauge versus six major currencies slumped the most in a week, to the lowest levels since May 22, after the US inflation data fuelled speculations of the US central bank’s halt to the rate hike trajectory present in the last 10 monetary policy meetings.
As per the latest US inflation data for May, the headline Consumer Price Index (CPI) drops more-than-expected and prior releases to 0.1% MoM and 4.0% YoY. However, the Core CPI, known as the CPI ex Food & Energy, matches 0.4% monthly and 5.3% yearly forecasts. It’s worth noting that the US headline CPI dropped to the lowest since March 2021 and hence justifies the market’s expectations of the US Federal Reserve (Fed) hawkish halt, which in turn should have weighed on the US Dollar.
Following the data, the CME’s FedWatch Tool suggests more than a 90% chance of the US Federal Reserve’s (Fed) no rate hike during today’s monetary policy meeting, versus around 75% chance before that.
It’s worth noting, however, that the ex-Fed Officials have been pushing for a hawkish halt to the rate hikes and prods the DXY bears. On Tuesday, Former Dallas Federal Reserve Bank (Fed) President Robert Kaplan said that he would support a "hawkish pause" at this week's meeting while also adding that he would “leave the question of a July hike open.” Previously, Ex-Boston Fed President Eric Rosengren tweeted, “Expect a hawkish skip this week.”
As a result, Wall Street benchmarks rose for the second consecutive day but the US Treasury bond yields remain firmer. That said, the US 10-year Treasury bond yields rose to a 13-day high of 3.83% whereas the two-year counterpart poked the highest levels in three months with 4.70% mark before easing to 4.67% in the last hours.
Looking ahead, the pre-Fed sentiment may prod the DXY, as well as allow the greenback’s gauge to pare recent losses. However, the traders will pay attention to the US central bank’s economic forecasts, dot-plot and Chairman Jerome Powell’s press conference for clear directions afterward, as the rate hike pause is almost given.
US Dollar Index grinds near the lowest levels in three weeks after snapping two-day winning streak.
US inflation data bolsters market’s bets on Fed’s status quo and weigh on the DXY despite upbeat yields.
Cautious mood ahead of the FOMC announcements put a floor under the US Dollar price.
Expectations of witnessing a hawkish halt from US central bank highlight qualitative updates from the Fed.
US Dollar Index (DXY) steadies above 103.00, after bouncing off a three-week low, as markets brace for the Federal Reserve (Fed) announcements on Wednesday. The greenback’s gauge versus six major currencies slumped the most in a week, to the lowest levels since May 22, after the US inflation data fuelled speculations of the US central bank’s halt to the rate hike trajectory present in the last 10 monetary policy meetings.
As per the latest US inflation data for May, the headline Consumer Price Index (CPI) drops more-than-expected and prior releases to 0.1% MoM and 4.0% YoY. However, the Core CPI, known as the CPI ex Food & Energy, matches 0.4% monthly and 5.3% yearly forecasts. It’s worth noting that the US headline CPI dropped to the lowest since March 2021 and hence justifies the market’s expectations of the US Federal Reserve (Fed) hawkish halt, which in turn should have weighed on the US Dollar.
Following the data, the CME’s FedWatch Tool suggests more than a 90% chance of the US Federal Reserve’s (Fed) no rate hike during today’s monetary policy meeting, versus around 75% chance before that.
It’s worth noting, however, that the ex-Fed Officials have been pushing for a hawkish halt to the rate hikes and prods the DXY bears. On Tuesday, Former Dallas Federal Reserve Bank (Fed) President Robert Kaplan said that he would support a "hawkish pause" at this week's meeting while also adding that he would “leave the question of a July hike open.” Previously, Ex-Boston Fed President Eric Rosengren tweeted, “Expect a hawkish skip this week.”
As a result, Wall Street benchmarks rose for the second consecutive day but the US Treasury bond yields remain firmer. That said, the US 10-year Treasury bond yields rose to a 13-day high of 3.83% whereas the two-year counterpart poked the highest levels in three months with 4.70% mark before easing to 4.67% in the last hours.
Looking ahead, the pre-Fed sentiment may prod the DXY, as well as allow the greenback’s gauge to pare recent losses. However, the traders will pay attention to the US central bank’s economic forecasts, dot-plot and Chairman Jerome Powell’s press conference for clear directions afterward, as the rate hike pause is almost given.
Comment:
European equity markets were set for a positive open on Friday, tracking global peers higher amid bets that US interest rates could be nearing their peak as the American economy loses momentum and after the Federal Reserve paused its tightening campaign in June. Meanwhile, the European Central Bank opted to raise interest rates by another 25 basis points, with ECB President Christine Lagarde saying ‘we are not thinking about pausing.” Investors now look ahead to final euro zone inflation figures and wage growth data for further clues on the economy and future monetary policy. DAX futures jumped 0.9%, Stoxx 600 futures gained 0.5% and FTSE 100 futures edged up 0.2% in premarket trade.
Comment:
The Dow finished more than 100 points below the flatline on Friday, the S&P 500 and the Nasdaq lost nearly 0.4% and 0.7%, respectively, as investors continued to assess the outlook of monetary policy for the Fed amid a massive options expiration at the second 2023’s quadruple witching date. Among stocks, Microsoft fell 1.7% and Micron Technology dropped 1.7%. Conversely, Virgin Galactic surged 16.3% on plans for commercial space tourism. Tesla added 1.8% after hitting a 37-week high during the session and Adobe gained 0.8% with positive earnings and guidance. On the week, the Dow Jones added 0.9%, marking a three-week winning streak despite the Fed's warning of future rate hikes. The S&P 500 gained 2.2%, its fifth consecutive weekly gain, the longest since November 2021, rising 2.2%. The Nasdaq was up 2.7% for an eighth straight positive week. Markets will be closed on Monday for the Juneteenth holiday.
Comment:
BTC Bears Target Sub-$26,000 on SEC v Binance and Ripple Battles
BTC was flat this morning, with regulatory uncertainty stemming from the SEC lawsuits against Ripple, Binance, and Coinbase testing buyer appetite.
The market structure and momentum of Bitcoin was bearish, but its bounce back above $26k gave bears some food for thought.
Bitcoin’s correlation with the S&P 500 turned negative over May. This meant that the index has an overall bullish outlook, but Bitcoin has trended in the opposite direction in recent weeks. The increasing hostility from regulatory bodies in the United States has played a part in BTC’s misfortunes on the price chart.
There was an argument to be made that Bitcoin showed some signs of recovery. Yet, an analysis of the price action showed that the bias remained in favor of the sellers. On the other hand, if Bitcoin climbs to $28k, it could signal an uptrend.
Can the bulls drive Bitcoin past $27.4k next?
The market structure of Bitcoin on the daily timeframe was bearish. The structure shifted on 21 April when BTC dipped below a recent higher low. Since then, the price has trended lower on the chart.
Moreover, the trading volume has been extremely low from April onward, compared to the volume seen in February and March. This was reflected on the OBV as well, which only went slightly lower in May in contrast to the rapid gains it posted in mid-March.
The Fibonacci levels based on the recent leg down show that Bitcoin was likely headed toward $24.8k. The 61.8% extension level at $23.3k was also a target it presented. The price action showed that the $24.2k-$24.4k region could serve as strong support. Beneath that, the $22.4k and $21.5k levels were important.
To signal a bullish shift in the structure, Bitcoin prices must rise back above the recent lower high at $27.4k. Yet, an uptrend would not be established there, as BTC would need to form a higher low and continue higher. Cautious investors can wait for this turn of events before looking to buy.
On Saturday, BTC extended the winning streak to three sessions, gaining 0.67% to end the day at $26,535.
SEC v Binance news delivered a breakout morning session before profit-taking left BTC with modest gains.
The technical indicators turned bullish, signaling a return to $27,000.
On Saturday, bitcoin (BTC) gained 0.67%. Following a 2.92% rally on Friday, BTC ended the day at $26,535. Significantly, BTC enjoyed its first three-day winning streak since May.
A mixed start to the day saw BTC fall to an early afternoon low of $26,202. Steering clear of the First Major Support Level (S1) at $25,523, BTC rose to a late morning high of $26,857. However, falling short of the First Major Resistance Level (R1) at $26,882, BTC eased back to sub-$26,500 and a range-bound afternoon session.
SEC v Binance News Delivered Brief Relief
On Saturday, news of Binance striking a deal to address the SEC’s motion to freeze Binance US assets supported a breakout morning.
Binance, Binance US, and the SEC agreed on a deal restricting access to customer funds to Binance US employees. The agreement prevents Binance Holdings staff from having access to private keys for US wallets.
The SEC filed a motion to freeze the assets of Binance US shortly after filing charges against Binance, Binance US, and Binance CEO CZ.
On Saturday, the US Court signed off on the deal, which allows Binance to repatriate all US customer funds and private keys onshore to nullify the motion to freeze.
While the news was positive, Binance US and Binance face charges that could drag on and further impact the US digital asset space.
Uncertainty toward the SEC v Ripple case remains another headwind, with optimism of a Ripple win fading after the release of the Hinman speech-related docs.
The Day Ahead
It is a quiet Sunday session, with no US economic indicators to provide direction. The lack of external market forces will leave BTC in the hands of the crypto market news wires.
SEC activity remains the focal point, with SEC v Ripple, Binance, and Coinbase (COIN)-related news likely to move the dial.
We also expect market sensitivity to lawmaker chatter. US lawmakers have remained silent on the William Hinman speech-related documents and the SEC charges against Binance and Coinbase.
Bitcoin (BTC) Price Action
This morning, BTC was down 0.05% to $26,523. A mixed start to the day saw BTC rise to an early high of $26,551 before falling to a low of $26,410.
BTC Technical Indicators
Looking at the EMAs and the 4-hourly candlestick chart (below), the EMAs sent bullish signals. BTC sat above the 100-day EMA ($26,269). The 50-day EMA closed in on the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, sending bullish signals.
A move through the 200-day EMA ($26,654) would support a breakout from R1 ($26,861) to target R2 ($27,186). However, a fall through the 100-day EMA ($26,269) and S1 ($26,206) would bring the 50-day EMA ($26,059) into view. A fall through the 50-day EMA would send a bearish signal.
Resistance & Support Levels
R1 – $ 26,861 S1 – $ 26,206
R2 – $ 27,186 S2 – $ 25,876
R3 – $ 27,841 S3 – $ 25,221
BTC needs to move through the $26,531 pivot to target the First Major Resistance Level (R1) at $26,861 and $27,500. A move through the Saturday high of $26,857 would signal an extended bullish session. The crypto news wires should be crypto-friendly to support an extended rally.
In the event of an extended rally, BTC would likely test the Second Major Resistance Level (R2) at $27,186 and resistance at $27,500. The Third Major Resistance Level (R3) sits at $27,841.
Failure to move through the pivot would leave the First Major Support Level (S1) at $26,206 in play. However, barring a risk-off-fueled sell-off, BTC should avoid sub-$26,000 and the Second Major Support Level (S2) at $25,876. The Third Major Support Level (S3) sits at $25,221.
BTC was flat this morning, with regulatory uncertainty stemming from the SEC lawsuits against Ripple, Binance, and Coinbase testing buyer appetite.
The market structure and momentum of Bitcoin was bearish, but its bounce back above $26k gave bears some food for thought.
Bitcoin’s correlation with the S&P 500 turned negative over May. This meant that the index has an overall bullish outlook, but Bitcoin has trended in the opposite direction in recent weeks. The increasing hostility from regulatory bodies in the United States has played a part in BTC’s misfortunes on the price chart.
There was an argument to be made that Bitcoin showed some signs of recovery. Yet, an analysis of the price action showed that the bias remained in favor of the sellers. On the other hand, if Bitcoin climbs to $28k, it could signal an uptrend.
Can the bulls drive Bitcoin past $27.4k next?
The market structure of Bitcoin on the daily timeframe was bearish. The structure shifted on 21 April when BTC dipped below a recent higher low. Since then, the price has trended lower on the chart.
Moreover, the trading volume has been extremely low from April onward, compared to the volume seen in February and March. This was reflected on the OBV as well, which only went slightly lower in May in contrast to the rapid gains it posted in mid-March.
The Fibonacci levels based on the recent leg down show that Bitcoin was likely headed toward $24.8k. The 61.8% extension level at $23.3k was also a target it presented. The price action showed that the $24.2k-$24.4k region could serve as strong support. Beneath that, the $22.4k and $21.5k levels were important.
To signal a bullish shift in the structure, Bitcoin prices must rise back above the recent lower high at $27.4k. Yet, an uptrend would not be established there, as BTC would need to form a higher low and continue higher. Cautious investors can wait for this turn of events before looking to buy.
On Saturday, BTC extended the winning streak to three sessions, gaining 0.67% to end the day at $26,535.
SEC v Binance news delivered a breakout morning session before profit-taking left BTC with modest gains.
The technical indicators turned bullish, signaling a return to $27,000.
On Saturday, bitcoin (BTC) gained 0.67%. Following a 2.92% rally on Friday, BTC ended the day at $26,535. Significantly, BTC enjoyed its first three-day winning streak since May.
A mixed start to the day saw BTC fall to an early afternoon low of $26,202. Steering clear of the First Major Support Level (S1) at $25,523, BTC rose to a late morning high of $26,857. However, falling short of the First Major Resistance Level (R1) at $26,882, BTC eased back to sub-$26,500 and a range-bound afternoon session.
SEC v Binance News Delivered Brief Relief
On Saturday, news of Binance striking a deal to address the SEC’s motion to freeze Binance US assets supported a breakout morning.
Binance, Binance US, and the SEC agreed on a deal restricting access to customer funds to Binance US employees. The agreement prevents Binance Holdings staff from having access to private keys for US wallets.
The SEC filed a motion to freeze the assets of Binance US shortly after filing charges against Binance, Binance US, and Binance CEO CZ.
On Saturday, the US Court signed off on the deal, which allows Binance to repatriate all US customer funds and private keys onshore to nullify the motion to freeze.
While the news was positive, Binance US and Binance face charges that could drag on and further impact the US digital asset space.
Uncertainty toward the SEC v Ripple case remains another headwind, with optimism of a Ripple win fading after the release of the Hinman speech-related docs.
The Day Ahead
It is a quiet Sunday session, with no US economic indicators to provide direction. The lack of external market forces will leave BTC in the hands of the crypto market news wires.
SEC activity remains the focal point, with SEC v Ripple, Binance, and Coinbase (COIN)-related news likely to move the dial.
We also expect market sensitivity to lawmaker chatter. US lawmakers have remained silent on the William Hinman speech-related documents and the SEC charges against Binance and Coinbase.
Bitcoin (BTC) Price Action
This morning, BTC was down 0.05% to $26,523. A mixed start to the day saw BTC rise to an early high of $26,551 before falling to a low of $26,410.
BTC Technical Indicators
Looking at the EMAs and the 4-hourly candlestick chart (below), the EMAs sent bullish signals. BTC sat above the 100-day EMA ($26,269). The 50-day EMA closed in on the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, sending bullish signals.
A move through the 200-day EMA ($26,654) would support a breakout from R1 ($26,861) to target R2 ($27,186). However, a fall through the 100-day EMA ($26,269) and S1 ($26,206) would bring the 50-day EMA ($26,059) into view. A fall through the 50-day EMA would send a bearish signal.
Resistance & Support Levels
R1 – $ 26,861 S1 – $ 26,206
R2 – $ 27,186 S2 – $ 25,876
R3 – $ 27,841 S3 – $ 25,221
BTC needs to move through the $26,531 pivot to target the First Major Resistance Level (R1) at $26,861 and $27,500. A move through the Saturday high of $26,857 would signal an extended bullish session. The crypto news wires should be crypto-friendly to support an extended rally.
In the event of an extended rally, BTC would likely test the Second Major Resistance Level (R2) at $27,186 and resistance at $27,500. The Third Major Resistance Level (R3) sits at $27,841.
Failure to move through the pivot would leave the First Major Support Level (S1) at $26,206 in play. However, barring a risk-off-fueled sell-off, BTC should avoid sub-$26,000 and the Second Major Support Level (S2) at $25,876. The Third Major Support Level (S3) sits at $25,221.
Comment:
Gold long going to above 2050
LONG
Gold Price Analysis: Testing Support Levels Amidst Consolidation and Breakout Attempts
Technical analysis reveals a retracement in gold, testing key support zones and indicating a healthy consolidation phase before an expected continuation of the uptrend.
Gold, FX Empire
Gold Forecast Video for 19.06.23 by Bruce Powers
Gold rises to a three-day high of 1,986 on Friday before pulling back. It attempted to breakout above the top boundary trendline of a small symmetrical triangle consolidation pattern but is now on track to close below it and within the consolidation range.
Attempting to Break Up yet Remains in Consolidation Range
So far, Thursday’s test of the 100-Day EMA with a day’s low of 1,925 has held up but further signs of strength are needed. Gold briefly dropped below the 100-Day line earlier in the session on Thursday but managed to close strong, back above it and near the high of the day. The 100-Day EMA is now at 1,940.
Further Signs of Strength are Needed
Further signs of strength are needed to indicate whether yesterday’s low completes the retracement or further tests will occur. This week’s candlestick pattern is set to close as a bullish doji hammer. Next week an upside breakout signal will occur on a move above the high at 1,971, and the breakout is confirmed on a daily close above that high. Following a move above that high the next weekly resistance levels are 1,973, 1,983, and 1,985. A subsequent daily close above each price level will confirm strength, otherwise some resistance might be seen again around those levels.
If Lows Tested Again
If lower prices occur before a continuation higher the two potential support zones are around the 61.8% Fibonacci retracement at 1,912, followed by the 200-Day EMA at 1,894. The 200-Day EMA was tested as support with a double bottom in the first quarter of this year price reversed higher from there.
Uptrend Intact
The current retracement in gold is a test of support around previous high swing high of 1,960 from early-February. So far, the retracement is normal and healthy for the uptrend. Consolidation has been occurring at the 50% retracement area as well as the 100-Day EMA. Notice that there is a greater distance between the 100-Day EMA and 200-Day than what was seen in February. It reflects an improving trend. Once this retracement is complete, all signs are that gold should continue higher.
Gold held above $1,950 an ounce on Friday after gaining 0.7% in the previous session, benefiting mainly from the dollar’s weakness as the Federal Reserve paused its tightening campaign at a time other major central banks are still raising interest rates. Still, the metal remains close to three-month lows as the Fed hinted at two more quarter-point rate increases this year, while the European Central Bank delivered another 25 basis point rate hike on Thursday and signaled further tightening. The Bank of England is also set to raise rates again at its June policy meeting, a month marked by surprise rate increases from the Reserve Bank of Australia and the Bank of Canada. Meanwhile, the People’s Bank of China lowered key short-term interest rates this week for the first time in ten months, while the Bank of Japan maintained its ultra-easy monetary policy on Friday.
Daily bullish
4H Bullish
34min Bullish
Gold is mostly traded on the OTC London market, the US futures market (COMEX) and the Shanghai Gold Exchange (SGE). The standard future contract is 100 troy ounces. Gold is an attractive investment during periods of political and economic uncertainty. Half of the gold consumption in the world is in jewelry, 40% in investments, and 10% in industry. The biggest producers of gold are China, Australia, United States, South Africa, Russia, Peru and Indonesia. The biggest consumers of gold jewelry are India, China, United States, Turkey, Saudi Arabia, Russia and UAE. The gold prices displayed in Trading Economics are based on over-the-counter (OTC) and contract for difference (CFD) financial instruments. Our gold prices are intended to provide you with a reference only, rather than as a basis for making trading decisions. Trading Economics does not verify any data and disclaims any obligation to do so.
LONG
Gold Price Analysis: Testing Support Levels Amidst Consolidation and Breakout Attempts
Technical analysis reveals a retracement in gold, testing key support zones and indicating a healthy consolidation phase before an expected continuation of the uptrend.
Gold, FX Empire
Gold Forecast Video for 19.06.23 by Bruce Powers
Gold rises to a three-day high of 1,986 on Friday before pulling back. It attempted to breakout above the top boundary trendline of a small symmetrical triangle consolidation pattern but is now on track to close below it and within the consolidation range.
Attempting to Break Up yet Remains in Consolidation Range
So far, Thursday’s test of the 100-Day EMA with a day’s low of 1,925 has held up but further signs of strength are needed. Gold briefly dropped below the 100-Day line earlier in the session on Thursday but managed to close strong, back above it and near the high of the day. The 100-Day EMA is now at 1,940.
Further Signs of Strength are Needed
Further signs of strength are needed to indicate whether yesterday’s low completes the retracement or further tests will occur. This week’s candlestick pattern is set to close as a bullish doji hammer. Next week an upside breakout signal will occur on a move above the high at 1,971, and the breakout is confirmed on a daily close above that high. Following a move above that high the next weekly resistance levels are 1,973, 1,983, and 1,985. A subsequent daily close above each price level will confirm strength, otherwise some resistance might be seen again around those levels.
If Lows Tested Again
If lower prices occur before a continuation higher the two potential support zones are around the 61.8% Fibonacci retracement at 1,912, followed by the 200-Day EMA at 1,894. The 200-Day EMA was tested as support with a double bottom in the first quarter of this year price reversed higher from there.
Uptrend Intact
The current retracement in gold is a test of support around previous high swing high of 1,960 from early-February. So far, the retracement is normal and healthy for the uptrend. Consolidation has been occurring at the 50% retracement area as well as the 100-Day EMA. Notice that there is a greater distance between the 100-Day EMA and 200-Day than what was seen in February. It reflects an improving trend. Once this retracement is complete, all signs are that gold should continue higher.
Gold held above $1,950 an ounce on Friday after gaining 0.7% in the previous session, benefiting mainly from the dollar’s weakness as the Federal Reserve paused its tightening campaign at a time other major central banks are still raising interest rates. Still, the metal remains close to three-month lows as the Fed hinted at two more quarter-point rate increases this year, while the European Central Bank delivered another 25 basis point rate hike on Thursday and signaled further tightening. The Bank of England is also set to raise rates again at its June policy meeting, a month marked by surprise rate increases from the Reserve Bank of Australia and the Bank of Canada. Meanwhile, the People’s Bank of China lowered key short-term interest rates this week for the first time in ten months, while the Bank of Japan maintained its ultra-easy monetary policy on Friday.
Daily bullish
4H Bullish
34min Bullish
Gold is mostly traded on the OTC London market, the US futures market (COMEX) and the Shanghai Gold Exchange (SGE). The standard future contract is 100 troy ounces. Gold is an attractive investment during periods of political and economic uncertainty. Half of the gold consumption in the world is in jewelry, 40% in investments, and 10% in industry. The biggest producers of gold are China, Australia, United States, South Africa, Russia, Peru and Indonesia. The biggest consumers of gold jewelry are India, China, United States, Turkey, Saudi Arabia, Russia and UAE. The gold prices displayed in Trading Economics are based on over-the-counter (OTC) and contract for difference (CFD) financial instruments. Our gold prices are intended to provide you with a reference only, rather than as a basis for making trading decisions. Trading Economics does not verify any data and disclaims any obligation to do so.
Comment:
Trend continuation confirmation still positive.Gold is bullish
Gold is Being Pulled Between a Hawkish Fed and New Geopolitical Concerns
US Housing Surprises, Fed Pauses but Remains Hawkish
Last week, US economic data revealed a much stronger than expected housing market, with the NAHB Housing Market Index surpassing expectations to hit its highest level since July of last year. New building permits also beat market expectations, and new housing starts surged to their highest level since May 2022.
Last month, we reviewed the three possibilities of a Federal Reserve pivoting to rate cuts, continuing to hike, or pausing. The June FOMC meeting delivered our most likely scenario of a pause, which we presented as one of the better cases for gold, at least in the short term.
However, what markets received from the June FOMC meeting was a hawkish pause, in which no action was taken, while Chair Powell renewed his hawkish rhetoric, underlining his commitment to the task of bringing down inflation.
In a busy week for FOMC speakers, markets had the opportunity to digest comments from a total of six FOMC members. Jerome Powell also made his semi-annual trip to Capitol Hill, testifying before the House Financial Services Committee, and Senate Banking Committee, where he all-but confirmed that more rate hikes are in store and stated that “we don’t see rate cuts any time soon.”
Gold’s Reaction
The result of this pull between the resilience of the US economy plus a hawkish Fed on the one hand, and growing geopolitical uncertainty on the other, has resulted in muted price action despite the overall bearish trend.
We’re seeing this among investors at HYCM as well, for whom gold is one of the most popular assets this year. Positioning suggests current price action could be a period of short-term profit-taking within a longer-term bullish view.
We can see this reflected in gold’s chart. Between June 20 and 22, which saw the release of US housing data and FOMC speeches, gold prices declined by almost 2.4%.
Gold is Being Pulled Between a Hawkish Fed and New Geopolitical Concerns
US Housing Surprises, Fed Pauses but Remains Hawkish
Last week, US economic data revealed a much stronger than expected housing market, with the NAHB Housing Market Index surpassing expectations to hit its highest level since July of last year. New building permits also beat market expectations, and new housing starts surged to their highest level since May 2022.
Last month, we reviewed the three possibilities of a Federal Reserve pivoting to rate cuts, continuing to hike, or pausing. The June FOMC meeting delivered our most likely scenario of a pause, which we presented as one of the better cases for gold, at least in the short term.
However, what markets received from the June FOMC meeting was a hawkish pause, in which no action was taken, while Chair Powell renewed his hawkish rhetoric, underlining his commitment to the task of bringing down inflation.
In a busy week for FOMC speakers, markets had the opportunity to digest comments from a total of six FOMC members. Jerome Powell also made his semi-annual trip to Capitol Hill, testifying before the House Financial Services Committee, and Senate Banking Committee, where he all-but confirmed that more rate hikes are in store and stated that “we don’t see rate cuts any time soon.”
Gold’s Reaction
The result of this pull between the resilience of the US economy plus a hawkish Fed on the one hand, and growing geopolitical uncertainty on the other, has resulted in muted price action despite the overall bearish trend.
We’re seeing this among investors at HYCM as well, for whom gold is one of the most popular assets this year. Positioning suggests current price action could be a period of short-term profit-taking within a longer-term bullish view.
We can see this reflected in gold’s chart. Between June 20 and 22, which saw the release of US housing data and FOMC speeches, gold prices declined by almost 2.4%.
Comment:
Fed Chair. Powell reiterated at the ECB Forum on Central Banking that interest rates will rise further and that he wouldn’t take moving in consecutive meetings off the table at all, but noted that a recession in the US is not the most likely case. Nvidia was down by over 2% and Advanced Micro Devices by 1% after the Wall Street Journal reported that the US government is considering new restrictions on exports of artificial intelligence chips to China. The Fed is also due to release the results of its annual stress tests to banks, and more details on Basel III Endgame and changes to bank supervision will be in the spotlight.
The Dow Jones was down over 100 points and the S&P 500 dipped by 0.1% on Wednesday afternoon, on the prospect of further interest rate hikes following the Federal Reserve's chair Powell Speech at the ECB Forum. He said he does not see inflation reaching the Fed's 2% target any time soon. He reiterated that interest rates will rise further and did not rule out a boost in the cost of borrowing at the next policy meeting scheduled for the end of July. Meantime, the Nasdaq was up 0.2% powered by megacap momentum stocks. Among stocks, shares of Nvidia and Advanced Micro Devices were down by 2% and 1%, respectively, after the US government is considering new restrictions on exports of AI chips to China. Intel, Applied Materials and Qualcomm fell more than 2% each. On the other hand, Apple hit an all-time high of $189.8 during the session, while shares of Tesla and Alphabet advanced 1.4% and 2.5%. The Fed is due to release the results of its annual stress tests to banks.
The Dow Jones was down over 100 points and the S&P 500 dipped by 0.1% on Wednesday afternoon, on the prospect of further interest rate hikes following the Federal Reserve's chair Powell Speech at the ECB Forum. He said he does not see inflation reaching the Fed's 2% target any time soon. He reiterated that interest rates will rise further and did not rule out a boost in the cost of borrowing at the next policy meeting scheduled for the end of July. Meantime, the Nasdaq was up 0.2% powered by megacap momentum stocks. Among stocks, shares of Nvidia and Advanced Micro Devices were down by 2% and 1%, respectively, after the US government is considering new restrictions on exports of AI chips to China. Intel, Applied Materials and Qualcomm fell more than 2% each. On the other hand, Apple hit an all-time high of $189.8 during the session, while shares of Tesla and Alphabet advanced 1.4% and 2.5%. The Fed is due to release the results of its annual stress tests to banks.
Comment:
The US economy grew by an annualized 2% on quarter in Q1 2023, well above 1.3% in the second estimate, and forecasts of 1.4%. The updated estimates primarily reflected upward revisions to exports and consumer spending that were partly offset by downward revisions to nonresidential fixed investment and federal government spending. Imports were revised down.
Comment:
Wall Street Edges Higher on Shortened Monday Session
US stocks closed with marginal gains on a shortened Monday session, setting the stage for caution in the second half of the year as markets continued to assess the economy’s resilience to further monetary tightening from the Federal Reserve. The Dow added 10 points, while the S&P 500 and the Nasdaq edged 0.1% and 0.2% higher, respectively. Shares from rate-sensitive sectors edged lower after ISM PMI data showed that US manufacturing contracted more than expected for an eighth consecutive month in June, reigniting concerns that restrictive borrowing costs will hamper economic activity to a large extent. Apple closed 1% down to set the pace for tech giants, pressured by news that the company cut production forecasts for the mixed-reality Vision Pro headset. On the other hand, Tesla rallied 6% as the company beat deliveries and production estimates for Q2. Stock exchanges in the US will be closed on Tuesday for the Independence Day holiday.
US stocks closed with marginal gains on a shortened Monday session, setting the stage for caution in the second half of the year as markets continued to assess the economy’s resilience to further monetary tightening from the Federal Reserve. The Dow added 10 points, while the S&P 500 and the Nasdaq edged 0.1% and 0.2% higher, respectively. Shares from rate-sensitive sectors edged lower after ISM PMI data showed that US manufacturing contracted more than expected for an eighth consecutive month in June, reigniting concerns that restrictive borrowing costs will hamper economic activity to a large extent. Apple closed 1% down to set the pace for tech giants, pressured by news that the company cut production forecasts for the mixed-reality Vision Pro headset. On the other hand, Tesla rallied 6% as the company beat deliveries and production estimates for Q2. Stock exchanges in the US will be closed on Tuesday for the Independence Day holiday.
Comment:
Wall Street Edges Higher on Shortened Monday Session
Comment:
Gold will rise higher
Comment:
bullish
TREND STRONG BULLISH
US Mortgage Rates Rise to 8-Month High
The average rate on a 30-year fixed mortgage increased by 10 basis points from the previous week to 6.81% in the week ending July 6th, the highest November 2022 as higher interest from the Federal Reserve underpinned expensive mortgage rates for American consumers. A year ago, the 30-year fixed mortgage rate was at 5.3%. “Mortgage rates continued their upward trajectory again this week, rising to the highest rate this year so far,” said Sam Khater, Freddie Mac’s Chief Economist. “This upward trend is being driven by a resilient economy, persistent inflation and a more hawkish tone from the Federal Reserve. These high rates combined with low i
TREND STRONG BULLISH
US Mortgage Rates Rise to 8-Month High
The average rate on a 30-year fixed mortgage increased by 10 basis points from the previous week to 6.81% in the week ending July 6th, the highest November 2022 as higher interest from the Federal Reserve underpinned expensive mortgage rates for American consumers. A year ago, the 30-year fixed mortgage rate was at 5.3%. “Mortgage rates continued their upward trajectory again this week, rising to the highest rate this year so far,” said Sam Khater, Freddie Mac’s Chief Economist. “This upward trend is being driven by a resilient economy, persistent inflation and a more hawkish tone from the Federal Reserve. These high rates combined with low i
Comment:
The Dow Jones closed more than 209 points higher on Monday, while the S&P 500 and the Nasdaq added 0.2% each, as investors awaited the US consumer and producer inflation reports later this week and braced for the start of the second quarter earnings season. The upcoming inflation report is expected to offer additional evidence regarding inflationary pressures and provide insights into the Federal Reserve's future actions. Traders are currently pricing in a nearly 92% chance for a 25bps increase in the fed funds rate this month, but the odds for another quarter point hike later in the year have been swinging, currently standing at 22% for September and 33% for November. Healthcare shares were among top performers of the session including Amgen (+2.5%). Also, Inter (+2.8%), Honeywell (+2.2%) and Home Depot (2.5%) outperformed while mega cap shares dragged as Apple (-1.1%), Tesla (-1.7%), Microsoft (-1.6%), Alphabet (-2.5%) and Amazon (-2%) ended in the red.
Comment:
Fed is close to end of rate hiking cycle, central bank officials say
July 10 (Reuters) – The Federal Reserve will likely need to raise interest rates further to bring down inflation that is still too high, but the end to its current monetary policy tightening cycle is getting close, several U.S. central bank officials said on Monday.
The Fed has raised interest rates by 5 percentage points since March 2022 to bring down the highest U.S. inflation in four decades. Fed policymakers opted last month to forego a rate increase to give themselves time to assess the still-developing effects of the previous hikes in borrowing costs, even as most also penciled in at least two more increases by the end of 2023.
"We're likely to need a couple more rate hikes over the course of this year to really bring inflation" sustainably back to the U.S. central bank's 2% goal, San Francisco Fed President Mary Daly said during an event at the Brookings Institution, giving voice to the most common view among her rate-setting peers at the Fed.
But, Daly added, while the risks of doing too little are still greater than those of overdoing it on rate hikes, the two sides are getting into better balance as the Fed nears "the last part" of its hiking cycle.
Daly said she fully supported June's policy decision, along with a go-slower approach that allows for more "extreme" data-dependence. "We may end up doing less because we need to do less; we may end up doing just that; we could end up doing more. The data will tell us." Fed policymakers are widely expected to deliver a rate hike at their meeting later this month, a move that would bring the policy rate to the 5.25%-5.50% range.
What's less clear is whether they will raise rates again at the September meeting, wait until November, or just stay on hold and let inflation ease over time.
Fed Chair Jerome Powell has said he cannot rule out consecutive rate hikes to deal with stubbornly high inflation, which by the central bank's preferred gauge, the personal consumption expenditures index, has fallen from a peak of 7% last year to 3.8% in May, still nearly twice the Fed's target.
"We still have a bit of work to do," Fed Vice Chair for Supervision Michael Barr said on Monday at a separate event. "I'll just say for myself, I think we're close." Atlanta Fed President Raphael Bostic, speaking at yet another event on Monday, repeated his view that the Fed can be "patient" on rates and allow restrictive policy to bring down inflation without further action by the central bank.
But within the Fed there remains a camp that feels just the opposite.
"In June, I was in the camp that we move up a little bit more and, in assessing where things are today, I'm still in that camp," Cleveland Fed President Loretta Mester said at an event held by the University of California, San Diego.
Still, she said, "we are closer to the end of our tightening phase than the beginning."
July 10 (Reuters) – The Federal Reserve will likely need to raise interest rates further to bring down inflation that is still too high, but the end to its current monetary policy tightening cycle is getting close, several U.S. central bank officials said on Monday.
The Fed has raised interest rates by 5 percentage points since March 2022 to bring down the highest U.S. inflation in four decades. Fed policymakers opted last month to forego a rate increase to give themselves time to assess the still-developing effects of the previous hikes in borrowing costs, even as most also penciled in at least two more increases by the end of 2023.
"We're likely to need a couple more rate hikes over the course of this year to really bring inflation" sustainably back to the U.S. central bank's 2% goal, San Francisco Fed President Mary Daly said during an event at the Brookings Institution, giving voice to the most common view among her rate-setting peers at the Fed.
But, Daly added, while the risks of doing too little are still greater than those of overdoing it on rate hikes, the two sides are getting into better balance as the Fed nears "the last part" of its hiking cycle.
Daly said she fully supported June's policy decision, along with a go-slower approach that allows for more "extreme" data-dependence. "We may end up doing less because we need to do less; we may end up doing just that; we could end up doing more. The data will tell us." Fed policymakers are widely expected to deliver a rate hike at their meeting later this month, a move that would bring the policy rate to the 5.25%-5.50% range.
What's less clear is whether they will raise rates again at the September meeting, wait until November, or just stay on hold and let inflation ease over time.
Fed Chair Jerome Powell has said he cannot rule out consecutive rate hikes to deal with stubbornly high inflation, which by the central bank's preferred gauge, the personal consumption expenditures index, has fallen from a peak of 7% last year to 3.8% in May, still nearly twice the Fed's target.
"We still have a bit of work to do," Fed Vice Chair for Supervision Michael Barr said on Monday at a separate event. "I'll just say for myself, I think we're close." Atlanta Fed President Raphael Bostic, speaking at yet another event on Monday, repeated his view that the Fed can be "patient" on rates and allow restrictive policy to bring down inflation without further action by the central bank.
But within the Fed there remains a camp that feels just the opposite.
"In June, I was in the camp that we move up a little bit more and, in assessing where things are today, I'm still in that camp," Cleveland Fed President Loretta Mester said at an event held by the University of California, San Diego.
Still, she said, "we are closer to the end of our tightening phase than the beginning."
Comment:
US 10-Year Treasury Yield Down for 2nd Session
The yield on the US 10-year Treasury note fell below 4%, retreating for the second consecutive session after hitting its highest since November 2022 at almost 4.1% as investors turned cautious ahead of key economic data that could influence the Federal Reserve’s next interest rate policy moves. The CPI report on Wednesday is expected to show headline annual inflation fell to 3.1% in June from 4% in the previous month, while the core index probably decreased to 5% from 5.3%. Markets are now pricing in a 94.9% chance of rates being hiked again during the central bank’s upcoming meeting on July 25-26 but uncertainty remains for the other three Fed meetings scheduled for later in the year. In the latest Fed commentary, Fed President Mary Daly said that she expects two further rate hikes to be announced this year to lower inflation, in line with early comments from Fed Chairman Jerome Powell.
Americans Become More Pessimistic in July
The IBD/TIPP Economic Optimism Index in the US unexpectedly fell to 41.3 in July 2023, the lowest since November last year, compared to 41.7 in June and market forecasts of 45.3. It also marks a 23rd month the reading stands below 50, indicating Americans remain pessimistic. “The economy continues to be the number one issue for Americans as we prepare for earnings season and new inflation data. The Six-Month Economic Outlook was the lone bright spot for July, as optimism slightly increased for the long-term, but it’s still a long way from positive. Expect some more twists and turns before consumers trust that the economy has stabilized”, said Ed Carson, IBD's news editor. The Personal Financial Outlook, a measure of how Americans feel about their own finances in the next six months, fell to 50 from 51.9 and the gauge for Confidence in Federal Economic Policies edged lower to 38.5 from 38.6. On the other hand, the Six-Month Economic Outlook rose to 35.5 from 34.5.
The yield on the US 10-year Treasury note fell below 4%, retreating for the second consecutive session after hitting its highest since November 2022 at almost 4.1% as investors turned cautious ahead of key economic data that could influence the Federal Reserve’s next interest rate policy moves. The CPI report on Wednesday is expected to show headline annual inflation fell to 3.1% in June from 4% in the previous month, while the core index probably decreased to 5% from 5.3%. Markets are now pricing in a 94.9% chance of rates being hiked again during the central bank’s upcoming meeting on July 25-26 but uncertainty remains for the other three Fed meetings scheduled for later in the year. In the latest Fed commentary, Fed President Mary Daly said that she expects two further rate hikes to be announced this year to lower inflation, in line with early comments from Fed Chairman Jerome Powell.
Americans Become More Pessimistic in July
The IBD/TIPP Economic Optimism Index in the US unexpectedly fell to 41.3 in July 2023, the lowest since November last year, compared to 41.7 in June and market forecasts of 45.3. It also marks a 23rd month the reading stands below 50, indicating Americans remain pessimistic. “The economy continues to be the number one issue for Americans as we prepare for earnings season and new inflation data. The Six-Month Economic Outlook was the lone bright spot for July, as optimism slightly increased for the long-term, but it’s still a long way from positive. Expect some more twists and turns before consumers trust that the economy has stabilized”, said Ed Carson, IBD's news editor. The Personal Financial Outlook, a measure of how Americans feel about their own finances in the next six months, fell to 50 from 51.9 and the gauge for Confidence in Federal Economic Policies edged lower to 38.5 from 38.6. On the other hand, the Six-Month Economic Outlook rose to 35.5 from 34.5.
Comment:
US 10-Year Treasury Yield Down for 2nd Session
The yield on the US 10-year Treasury note fell below 4%, retreating for the second consecutive session after hitting its highest since November 2022 at almost 4.1% as investors turned cautious ahead of key economic data that could influence the Federal Reserve’s next interest rate policy moves. The CPI report on Wednesday is expected to show headline annual inflation fell to 3.1% in June from 4% in the previous month, while the core index probably decreased to 5% from 5.3%. Markets are now pricing in a 94.9% chance of rates being hiked again during the central bank’s upcoming meeting on July 25-26 but uncertainty remains for the other three Fed meetings scheduled for later in the year. In the latest Fed commentary, Fed President Mary Daly said that she expects two further rate hikes to be announced this year to lower inflation, in line with early comments from Fed Chairman Jerome Powell.
Americans Become More Pessimistic in July
The IBD/TIPP Economic Optimism Index in the US unexpectedly fell to 41.3 in July 2023, the lowest since November last year, compared to 41.7 in June and market forecasts of 45.3. It also marks a 23rd month the reading stands below 50, indicating Americans remain pessimistic. “The economy continues to be the number one issue for Americans as we prepare for earnings season and new inflation data. The Six-Month Economic Outlook was the lone bright spot for July, as optimism slightly increased for the long-term, but it’s still a long way from positive. Expect some more twists and turns before consumers trust that the economy has stabilized”, said Ed Carson, IBD's news editor. The Personal Financial Outlook, a measure of how Americans feel about their own finances in the next six months, fell to 50 from 51.9 and the gauge for Confidence in Federal Economic Policies edged lower to 38.5 from 38.6. On the other hand, the Six-Month Economic Outlook rose to 35.5 from 34.5.
The yield on the US 10-year Treasury note fell below 4%, retreating for the second consecutive session after hitting its highest since November 2022 at almost 4.1% as investors turned cautious ahead of key economic data that could influence the Federal Reserve’s next interest rate policy moves. The CPI report on Wednesday is expected to show headline annual inflation fell to 3.1% in June from 4% in the previous month, while the core index probably decreased to 5% from 5.3%. Markets are now pricing in a 94.9% chance of rates being hiked again during the central bank’s upcoming meeting on July 25-26 but uncertainty remains for the other three Fed meetings scheduled for later in the year. In the latest Fed commentary, Fed President Mary Daly said that she expects two further rate hikes to be announced this year to lower inflation, in line with early comments from Fed Chairman Jerome Powell.
Americans Become More Pessimistic in July
The IBD/TIPP Economic Optimism Index in the US unexpectedly fell to 41.3 in July 2023, the lowest since November last year, compared to 41.7 in June and market forecasts of 45.3. It also marks a 23rd month the reading stands below 50, indicating Americans remain pessimistic. “The economy continues to be the number one issue for Americans as we prepare for earnings season and new inflation data. The Six-Month Economic Outlook was the lone bright spot for July, as optimism slightly increased for the long-term, but it’s still a long way from positive. Expect some more twists and turns before consumers trust that the economy has stabilized”, said Ed Carson, IBD's news editor. The Personal Financial Outlook, a measure of how Americans feel about their own finances in the next six months, fell to 50 from 51.9 and the gauge for Confidence in Federal Economic Policies edged lower to 38.5 from 38.6. On the other hand, the Six-Month Economic Outlook rose to 35.5 from 34.5.
Comment:
Wall Street Extends Gain Ahead of CPI Data
US stocks closed higher on Tuesday, extending gains for the second session, as investors looked forward to the key inflation report due tomorrow. The Dow Jones finished over 316 points higher, as Salesforce rose 3.9% after the company announced it will be increasing list prices an average of 9% in August. 3M and Boeing were also among the top performers and advanced by 4.8% and 2.6%, respectively. The S&P 500 gained nearly 0.7%, led by the energy sector as APA (+6.3%), Halliburton (+4.2%) and Schlumberger (+4.5%) outperformed. Meanwhile, the Nasdaq added 0.5%. Traders were also digesting comments from several Fed officials which continued to point to the need of further tightening this year. The odds for a 25bps increase in the fed funds rate this year currently stand at 95%, but investors remain divided about another rate hike. The economic calendar is soft today and the earnings season kicks off later in the week.
US stocks closed higher on Tuesday, extending gains for the second session, as investors looked forward to the key inflation report due tomorrow. The Dow Jones finished over 316 points higher, as Salesforce rose 3.9% after the company announced it will be increasing list prices an average of 9% in August. 3M and Boeing were also among the top performers and advanced by 4.8% and 2.6%, respectively. The S&P 500 gained nearly 0.7%, led by the energy sector as APA (+6.3%), Halliburton (+4.2%) and Schlumberger (+4.5%) outperformed. Meanwhile, the Nasdaq added 0.5%. Traders were also digesting comments from several Fed officials which continued to point to the need of further tightening this year. The odds for a 25bps increase in the fed funds rate this year currently stand at 95%, but investors remain divided about another rate hike. The economic calendar is soft today and the earnings season kicks off later in the week.
Comment:
Dollar Index Hits 14-month Low
DXY decreased to a 14-month low of 100.61
Wall Street Rallies after Softer Inflation
US stocks surged on Wednesday after both headline and core inflation fell more than expected in June, reinforcing the view the Federal Reserve may stop the tightening campaign sooner than expected. The Dow Jones gained around 250 points to 34548, the highest level since November last year, with 3M and Goldman Sachs up nearly 2% and among the top performers. The S&P 500 added 0.9% 4477, a level not seen since April of 2022, led by shares in the consumer discretionary, tech and real estate sectors. The Nasdaq was up about 1.2% to 13906, also the highest since April last year. Traders are currently pricing in a 92% chance for a 25bps increase in the fed funds rate this month, while the odds for another quarter-point hike in September fell to 13% from 20% before the CPI release and in November eased to 26% from 34%.
Brazil Business Morale Rises to 8-Month High
The Industrial Entrepreneur Confidence Index (ICEI) in Brazil rose by 0.7 points from the previous month to an eight-month high of 51.1 in July of 2023. This marks the second consecutive month in which the industry has shown confidence, attributed primarily to a more positive evaluation of the current economic conditions (+1.3 points to 45.5). Also, the indicator of future expectations increased (+0.4 points to 53.9), indicating optimism for the next six months.
FTSE MIB Close Rise to 15-Year High
The FTSE MIB index closed 1.8% higher at 28,573 on Wednesday, outperforming other benchmark European indices amid sharp gains for its heavyweight financial sector as markets digested the soft US inflation print. American consumer prices rose by 3% annually in June, below estimates of 3.1%, benefitting from a slowdown in core consumer prices. The development lifted equities amid hopes that the Fed will be able to ease its hawkish pressure. Banks were among the sharpest gainers as BTP yields fell by 15bps, aiding their balance sheet with Banca MPS and Banco BPM both adding more than 2%. In the meantime, STMicroelectronics shares surged 4.8% amid recommendation updates from Jeffries and Citigroup.
DXY decreased to a 14-month low of 100.61
Wall Street Rallies after Softer Inflation
US stocks surged on Wednesday after both headline and core inflation fell more than expected in June, reinforcing the view the Federal Reserve may stop the tightening campaign sooner than expected. The Dow Jones gained around 250 points to 34548, the highest level since November last year, with 3M and Goldman Sachs up nearly 2% and among the top performers. The S&P 500 added 0.9% 4477, a level not seen since April of 2022, led by shares in the consumer discretionary, tech and real estate sectors. The Nasdaq was up about 1.2% to 13906, also the highest since April last year. Traders are currently pricing in a 92% chance for a 25bps increase in the fed funds rate this month, while the odds for another quarter-point hike in September fell to 13% from 20% before the CPI release and in November eased to 26% from 34%.
Brazil Business Morale Rises to 8-Month High
The Industrial Entrepreneur Confidence Index (ICEI) in Brazil rose by 0.7 points from the previous month to an eight-month high of 51.1 in July of 2023. This marks the second consecutive month in which the industry has shown confidence, attributed primarily to a more positive evaluation of the current economic conditions (+1.3 points to 45.5). Also, the indicator of future expectations increased (+0.4 points to 53.9), indicating optimism for the next six months.
FTSE MIB Close Rise to 15-Year High
The FTSE MIB index closed 1.8% higher at 28,573 on Wednesday, outperforming other benchmark European indices amid sharp gains for its heavyweight financial sector as markets digested the soft US inflation print. American consumer prices rose by 3% annually in June, below estimates of 3.1%, benefitting from a slowdown in core consumer prices. The development lifted equities amid hopes that the Fed will be able to ease its hawkish pressure. Banks were among the sharpest gainers as BTP yields fell by 15bps, aiding their balance sheet with Banca MPS and Banco BPM both adding more than 2%. In the meantime, STMicroelectronics shares surged 4.8% amid recommendation updates from Jeffries and Citigroup.
Comment:
Dollar Index Hits 14-month Low
Comment:
US Stocks Pop on Cooling Inflation
All major US stocks indexes were trading in the green on Wednesday afternoon as June CPI data came cooler-than-expected, raising hopes that Fed officials might rethink their stance on more rate hikes. The Dow Jones was up more than 100 points after reaching the highest level since November earlier in the session, as Salesforce, Goldman Sachs and Home Depot outperformed, adding nearly 2% each. The S&P 500 gained 0.8%, a level not seen since April of 2022, led by shares in the consumer discretionary, tech and basic materials sectors. The Nasdaq was up about 1.2%, also the highest since April last year. Bank stocks advanced firmly, with Citigroup and Goldman Sachs adding 2.9% and 2.5%, respectively. Also, regional banks such as Comerica(5.1%) and Zions Bancorporation (4.9%). In the news, Domino's Pizza surged over 11% after revealing its deal with Uber Eats.
All major US stocks indexes were trading in the green on Wednesday afternoon as June CPI data came cooler-than-expected, raising hopes that Fed officials might rethink their stance on more rate hikes. The Dow Jones was up more than 100 points after reaching the highest level since November earlier in the session, as Salesforce, Goldman Sachs and Home Depot outperformed, adding nearly 2% each. The S&P 500 gained 0.8%, a level not seen since April of 2022, led by shares in the consumer discretionary, tech and basic materials sectors. The Nasdaq was up about 1.2%, also the highest since April last year. Bank stocks advanced firmly, with Citigroup and Goldman Sachs adding 2.9% and 2.5%, respectively. Also, regional banks such as Comerica(5.1%) and Zions Bancorporation (4.9%). In the news, Domino's Pizza surged over 11% after revealing its deal with Uber Eats.Japanese Yen attempting fifth consecutive daily advance (first time since December)
USD/JPY plunge now approaching major support confluence- risk for price inflection
Resistance 140.10s, 140.93, 142.10/50 (key)- support 137.36/91, 136.15, 134.04
The Japanese Yen has continued to coil just below uptrend resistance with major event risk on tap into the close of the week. The focus is on a breakout of the monthly opening-range for guidance. These are the updated targets and invalidation levels that matter on the USD/JPY short-term technical charts.
Initial resistance now eyed at the 75% parallel (blue slope currently ~140.10s) backed by the objective May high at 140.93. Ultimately, a breach / close above the weekly open / 61.8% retracement of the 2022 decline at 142.10/50 would be needed to mark resumption of the broader USD/JPY uptrend.
Bottom line: The USD/JPY plunge us approaching the first major technical support hurdle just below the 138-handle. From at trading standpoint, look to reduce portions of short-exposure / lower protective stops on a stretch towards this key support zone – rallies should be limited to the weekly open IF price is heading lower on this stretch. I’ll publish an updated Japanese Yen Weekly Forecast once we get further clarity on the longer-term USD/JPY technical trade levels.
All major US stocks indexes were trading in the green on Wednesday afternoon as June CPI data came cooler-than-expected, raising hopes that Fed officials might rethink their stance on more rate hikes. The Dow Jones was up more than 100 points after reaching the highest level since November earlier in the session, as Salesforce, Goldman Sachs and Home Depot outperformed, adding nearly 2% each. The S&P 500 gained 0.8%, a level not seen since April of 2022, led by shares in the consumer discretionary, tech and basic materials sectors. The Nasdaq was up about 1.2%, also the highest since April last year. Bank stocks advanced firmly, with Citigroup and Goldman Sachs adding 2.9% and 2.5%, respectively. Also, regional banks such as Comerica(5.1%) and Zions Bancorporation (4.9%). In the news, Domino's Pizza surged over 11% after revealing its deal with Uber Eats.
All major US stocks indexes were trading in the green on Wednesday afternoon as June CPI data came cooler-than-expected, raising hopes that Fed officials might rethink their stance on more rate hikes. The Dow Jones was up more than 100 points after reaching the highest level since November earlier in the session, as Salesforce, Goldman Sachs and Home Depot outperformed, adding nearly 2% each. The S&P 500 gained 0.8%, a level not seen since April of 2022, led by shares in the consumer discretionary, tech and basic materials sectors. The Nasdaq was up about 1.2%, also the highest since April last year. Bank stocks advanced firmly, with Citigroup and Goldman Sachs adding 2.9% and 2.5%, respectively. Also, regional banks such as Comerica(5.1%) and Zions Bancorporation (4.9%). In the news, Domino's Pizza surged over 11% after revealing its deal with Uber Eats.Japanese Yen attempting fifth consecutive daily advance (first time since December)
USD/JPY plunge now approaching major support confluence- risk for price inflection
Resistance 140.10s, 140.93, 142.10/50 (key)- support 137.36/91, 136.15, 134.04
The Japanese Yen has continued to coil just below uptrend resistance with major event risk on tap into the close of the week. The focus is on a breakout of the monthly opening-range for guidance. These are the updated targets and invalidation levels that matter on the USD/JPY short-term technical charts.
Initial resistance now eyed at the 75% parallel (blue slope currently ~140.10s) backed by the objective May high at 140.93. Ultimately, a breach / close above the weekly open / 61.8% retracement of the 2022 decline at 142.10/50 would be needed to mark resumption of the broader USD/JPY uptrend.
Bottom line: The USD/JPY plunge us approaching the first major technical support hurdle just below the 138-handle. From at trading standpoint, look to reduce portions of short-exposure / lower protective stops on a stretch towards this key support zone – rallies should be limited to the weekly open IF price is heading lower on this stretch. I’ll publish an updated Japanese Yen Weekly Forecast once we get further clarity on the longer-term USD/JPY technical trade levels.
Comment:
US Futures Steady Ahead of Major Bank Earnings
US stock futures held steady on Friday after four-day winning streak on Wall Street as investors look ahead to earnings reports from major banks. Futures contracts tied to the three major indexes were all trading near breakeven. In regular trading on Thursday, the Dow rose 0.14%, the S&P 500 gained 0.85% and the Nasdaq Composite rallied 1.58%, with nine out of the 11 S&P sectors ending higher led to the upside by communication services, technology and consumer discretionary. Those gains came as the latest producer price index report showed inflation rose less than anticipated in June, adding to signs that US inflation is on a downward trend and raising hopes that the current tightening cycle is nearing the end. Investors now await earnings reports from big banks such as JPMorgan, Wells Fargo and Citi on Friday for more clues on the economy. US consumer sentiment data from the University of Michigan is also on deck.
US stock futures held steady on Friday after four-day winning streak on Wall Street as investors look ahead to earnings reports from major banks. Futures contracts tied to the three major indexes were all trading near breakeven. In regular trading on Thursday, the Dow rose 0.14%, the S&P 500 gained 0.85% and the Nasdaq Composite rallied 1.58%, with nine out of the 11 S&P sectors ending higher led to the upside by communication services, technology and consumer discretionary. Those gains came as the latest producer price index report showed inflation rose less than anticipated in June, adding to signs that US inflation is on a downward trend and raising hopes that the current tightening cycle is nearing the end. Investors now await earnings reports from big banks such as JPMorgan, Wells Fargo and Citi on Friday for more clues on the economy. US consumer sentiment data from the University of Michigan is also on deck.
Comment:
bullish
Comment:
Comment:
The greenback is approaching a make-or-break moment — at least as far as a closely watched technical indicator is concerned.
The Bloomberg Dollar Index has now surrendered more than 61.8% of its gains since May 2021, bringing it to one of the Fibonacci retracement levels popular among chart watchers. They tend to keep a close eye on these indicators to determine whether or not trends will extend or reverse.
What happens next is therefore crucial.
If the index remains below this point over the coming sessions, it would be a strong signal to traders that the currency’s losses are the beginning of a new longer-term downtrend, and not just an aberration.
The latest bout of weakness comes as the market now sees an end to a tightening spree that Federal Reserve officials begun communicating more than two years ago. The prospect is narrowing interest-rate differentials with other major currencies and weighing on the dollar.
This week, it dropped to the weakest level against euro and pound since early 2022. It’s even falling out of favor against the yen — where rates are still negative — with the cross falling to a two-month low.
The bearish signal seen in the chart of the Bloomberg Dollar Index could be soon validated elsewhere too. The ICE Dollar Index — a popular alternative to the BBDXY — stands just 0.6% higher than the 61.8% Fibonacci retracement of a rally that kicked off in January 2021.
To be sure, options paint a more mixed picture. While long-term bets are supportive of the US currency’s prospects, sentiment over a one-month sentiment has reached its least bullish level since September 2020.
The Bloomberg Dollar Index has now surrendered more than 61.8% of its gains since May 2021, bringing it to one of the Fibonacci retracement levels popular among chart watchers. They tend to keep a close eye on these indicators to determine whether or not trends will extend or reverse.
What happens next is therefore crucial.
If the index remains below this point over the coming sessions, it would be a strong signal to traders that the currency’s losses are the beginning of a new longer-term downtrend, and not just an aberration.
The latest bout of weakness comes as the market now sees an end to a tightening spree that Federal Reserve officials begun communicating more than two years ago. The prospect is narrowing interest-rate differentials with other major currencies and weighing on the dollar.
This week, it dropped to the weakest level against euro and pound since early 2022. It’s even falling out of favor against the yen — where rates are still negative — with the cross falling to a two-month low.
The bearish signal seen in the chart of the Bloomberg Dollar Index could be soon validated elsewhere too. The ICE Dollar Index — a popular alternative to the BBDXY — stands just 0.6% higher than the 61.8% Fibonacci retracement of a rally that kicked off in January 2021.
To be sure, options paint a more mixed picture. While long-term bets are supportive of the US currency’s prospects, sentiment over a one-month sentiment has reached its least bullish level since September 2020.
Comment:
The greenback is approaching a make-or-break moment — at least as far as a closely watched technical indicator is concerned.
The Bloomberg Dollar Index has now surrendered more than 61.8% of its gains since May 2021, bringing it to one of the Fibonacci retracement levels popular among chart watchers. They tend to keep a close eye on these indicators to determine whether or not trends will extend or reverse.
What happens next is therefore crucial.
If the index remains below this point over the coming sessions, it would be a strong signal to traders that the currency’s losses are the beginning of a new longer-term downtrend, and not just an aberration.
The latest bout of weakness comes as the market now sees an end to a tightening spree that Federal Reserve officials begun communicating more than two years ago. The prospect is narrowing interest-rate differentials with other major currencies and weighing on the dollar.
This week, it dropped to the weakest level against euro and pound since early 2022. It’s even falling out of favor against the yen — where rates are still negative — with the cross falling to a two-month low.
The bearish signal seen in the chart of the Bloomberg Dollar Index could be soon validated elsewhere too. The ICE Dollar Index — a popular alternative to the BBDXY — stands just 0.6% higher than the 61.8% Fibonacci retracement of a rally that kicked off in January 2021.
To be sure, options paint a more mixed picture. While long-term bets are supportive of the US currency’s prospects, sentiment over a one-month sentiment has reached its least bullish level since September 2020.
The Bloomberg Dollar Index has now surrendered more than 61.8% of its gains since May 2021, bringing it to one of the Fibonacci retracement levels popular among chart watchers. They tend to keep a close eye on these indicators to determine whether or not trends will extend or reverse.
What happens next is therefore crucial.
If the index remains below this point over the coming sessions, it would be a strong signal to traders that the currency’s losses are the beginning of a new longer-term downtrend, and not just an aberration.
The latest bout of weakness comes as the market now sees an end to a tightening spree that Federal Reserve officials begun communicating more than two years ago. The prospect is narrowing interest-rate differentials with other major currencies and weighing on the dollar.
This week, it dropped to the weakest level against euro and pound since early 2022. It’s even falling out of favor against the yen — where rates are still negative — with the cross falling to a two-month low.
The bearish signal seen in the chart of the Bloomberg Dollar Index could be soon validated elsewhere too. The ICE Dollar Index — a popular alternative to the BBDXY — stands just 0.6% higher than the 61.8% Fibonacci retracement of a rally that kicked off in January 2021.
To be sure, options paint a more mixed picture. While long-term bets are supportive of the US currency’s prospects, sentiment over a one-month sentiment has reached its least bullish level since September 2020.
Comment:
USDJPY BULLISH WILL Go to 180 Yen
LONG
the Bank of Japan is unlikely to increase its ultra-loose policy rate until Governor Kuroda's term expires in the first quarter of 2023.
A break below 124is the start of bearish trend.
Technical: BULLISH
STRATEGY
BUY THE CORRECTION
Higher Highs
Higher Lows
Fundamentals:
See my previouse USDJPY trade ideas.All Tades are active, and a lot of fundamental explanations of USDJPY. Read them.Undestand them,then you can mae good trades.
Crude Oil Bearish Iran’s Growing Oil Production Boosting Up
SHORT
34minute Chart found its suppot . The corection was expected, as Japan Industrial Output Falls More than Initially Anticipated
BITCOIN WILL RISE HIGHER
LONG
GOLD STRONG BUY
Nasdaq100 US100 Bullish 21000 on Radar
LONG
EUR/USD re-targets 1.1000 post US-CPI
LONG
GBPUSD Bullish on Hot UK Inflation
LONG
XRP LONG 0.75$ and 1.15$ are on the Radar
LONG
GBPUSD Long Buyers to retain control
LONG
Litecoin Targeting Weekly Resistance
LONG
EUR/JPY Long A Break above creates more Buy Pressure
LONG
USDCHF BEARISH Meets monthly Low and Support
SHORT
LONG
the Bank of Japan is unlikely to increase its ultra-loose policy rate until Governor Kuroda's term expires in the first quarter of 2023.
A break below 124is the start of bearish trend.
Technical: BULLISH
STRATEGY
BUY THE CORRECTION
Higher Highs
Higher Lows
Fundamentals:
See my previouse USDJPY trade ideas.All Tades are active, and a lot of fundamental explanations of USDJPY. Read them.Undestand them,then you can mae good trades.
Crude Oil Bearish Iran’s Growing Oil Production Boosting Up
SHORT
34minute Chart found its suppot . The corection was expected, as Japan Industrial Output Falls More than Initially Anticipated
BITCOIN WILL RISE HIGHER
LONG
GOLD STRONG BUY
Nasdaq100 US100 Bullish 21000 on Radar
LONG
EUR/USD re-targets 1.1000 post US-CPI
LONG
GBPUSD Bullish on Hot UK Inflation
LONG
XRP LONG 0.75$ and 1.15$ are on the Radar
LONG
GBPUSD Long Buyers to retain control
LONG
Litecoin Targeting Weekly Resistance
LONG
EUR/JPY Long A Break above creates more Buy Pressure
LONG
USDCHF BEARISH Meets monthly Low and Support
SHORT
Comment:
Week Ahead - July 17th
Next week, investors will focus on the earnings results from major US companies, such as Bank of America, Morgan Stanley, Goldman Sachs, IBM, Netflix, Tesla, and Johnson & Johnson. Additionally, it will be interesting to monitor retail sales, industrial production, and housing data, including existing home sales, housing starts, and building permits. In other news, China is set to release Q2 GDP growth, retail sales, industrial production, and fixed asset investments. Markets will also be attentive to inflation rates in the United Kingdom, Canada, Japan, New Zealand, and South Africa. Furthermore, the central banks of Turkey and South Africa will make decisions regarding monetary policy, Australia will publish the unemployment rate, and the UK and Canada will release retail sales data.
Next week, investors will focus on the earnings results from major US companies, such as Bank of America, Morgan Stanley, Goldman Sachs, IBM, Netflix, Tesla, and Johnson & Johnson. Additionally, it will be interesting to monitor retail sales, industrial production, and housing data, including existing home sales, housing starts, and building permits. In other news, China is set to release Q2 GDP growth, retail sales, industrial production, and fixed asset investments. Markets will also be attentive to inflation rates in the United Kingdom, Canada, Japan, New Zealand, and South Africa. Furthermore, the central banks of Turkey and South Africa will make decisions regarding monetary policy, Australia will publish the unemployment rate, and the UK and Canada will release retail sales data.
Comment:
Bitcoin long will Go highe after Profit Taking
LONG
LONG
Comment:
This trade is still open and active
Government Bond Yields Fall for 2nd Session
Government bond yields around the world fell for a second day on Tuesday, with the US 10-year Treasury note yield, seen as a proxy for global borrowing costs, retreating to 3.76%, a level not seen since late June. Investors are getting increasingly convinced that major central banks, and specially the Federal Reserve, will soon end their tightening campaign. Bets for a 25bps hike in the fed funds rate next week currently stand at 97% but investors remain divided on the need of further increases, with chances for a September increase currently standing at 12% and for November at 22%. Meanwhile, the ECB is also set to raise rates by 25bps again next week while there is just a 70% chance of a further rate rise in September. The Bank of England will decide on monetary policy in August only, but either a 25bps or a 50bps hike are seen as certain. On the other hand, traders are increasingly speculating the Bank of Japan could adjust its ultra loose monetary policy next week.
The yield on the German 10-year government bond fell to 2.4%, down from the four-month high of 2.679% reached on July 10, as signs of cooling inflation in the US increased speculation that the Federal Reserve is approaching the end of a series of significant interest rate hikes. Nevertheless, the European Central Bank is expected to persist with raising rates throughout the year, aiming for a deposit rate peak of 4% by year-end. However, a recent batch of weak economic data from across the region might prompt the central bank to revise its inflation forecasts in September, possibly leaving the deposit facility rate at 3.75%. Hawkish ECB policymaker Joachim Nagel expressed caution on Monday about further tightening moves in September, stating that "we will see what the data will tell us." In addition, his colleague Klaas Knot said monetary tightening beyond July’s meeting is anything but guaranteed.
Turkish Lira Weakens to Fresh Record Low
The Turkish lira weakened more than 2% to a fresh record low of 26.9 per USD, as both the central bank and state-run banks stopped supporting the currency ahead of the central bank monetary policy decision on Thursday. Most investors expect a 500bps increase in interest rates, although some market participants said the rise could be smaller. On June 22nd, the central bank of Turkey raised interest rates by 650 bps to 15%, marking a reversal from its previous ultra-loose and unorthodox monetary policy although the move fell short of meeting market expectations for a higher rate of 21%
Euro Hits Fresh 17-Month High
The euro strengthened its position above $1.12, reaching its highest level since February 2022, on the back of investor expectations that the European Central Bank will continue its rate-hike cycle to tackle inflation and bring it closer to the 2% target. In the Eurozone, inflation declined to a 17-month low of 5.5% in June, but the core rate remained stubbornly high at 5.4%, still close to the all-time high of 5.7% seen in March. Currently, the interest rates in the bloc stand at 3.5%, but traders anticipate rates peaking at 4% by the end of the year. However, a recent batch of weak economic data from across the region might prompt the central bank to revise its inflation forecasts in September, possibly leaving the deposit facility rate at 3.75%. Simultaneously, the recently released weaker-than-expected US inflation data has fueled speculations that the Federal Reserve is nearing the conclusion of its current policy tightening measures.
Government Bond Yields Fall for 2nd Session
Government bond yields around the world fell for a second day on Tuesday, with the US 10-year Treasury note yield, seen as a proxy for global borrowing costs, retreating to 3.76%, a level not seen since late June. Investors are getting increasingly convinced that major central banks, and specially the Federal Reserve, will soon end their tightening campaign. Bets for a 25bps hike in the fed funds rate next week currently stand at 97% but investors remain divided on the need of further increases, with chances for a September increase currently standing at 12% and for November at 22%. Meanwhile, the ECB is also set to raise rates by 25bps again next week while there is just a 70% chance of a further rate rise in September. The Bank of England will decide on monetary policy in August only, but either a 25bps or a 50bps hike are seen as certain. On the other hand, traders are increasingly speculating the Bank of Japan could adjust its ultra loose monetary policy next week.
The yield on the German 10-year government bond fell to 2.4%, down from the four-month high of 2.679% reached on July 10, as signs of cooling inflation in the US increased speculation that the Federal Reserve is approaching the end of a series of significant interest rate hikes. Nevertheless, the European Central Bank is expected to persist with raising rates throughout the year, aiming for a deposit rate peak of 4% by year-end. However, a recent batch of weak economic data from across the region might prompt the central bank to revise its inflation forecasts in September, possibly leaving the deposit facility rate at 3.75%. Hawkish ECB policymaker Joachim Nagel expressed caution on Monday about further tightening moves in September, stating that "we will see what the data will tell us." In addition, his colleague Klaas Knot said monetary tightening beyond July’s meeting is anything but guaranteed.
Turkish Lira Weakens to Fresh Record Low
The Turkish lira weakened more than 2% to a fresh record low of 26.9 per USD, as both the central bank and state-run banks stopped supporting the currency ahead of the central bank monetary policy decision on Thursday. Most investors expect a 500bps increase in interest rates, although some market participants said the rise could be smaller. On June 22nd, the central bank of Turkey raised interest rates by 650 bps to 15%, marking a reversal from its previous ultra-loose and unorthodox monetary policy although the move fell short of meeting market expectations for a higher rate of 21%
Euro Hits Fresh 17-Month High
The euro strengthened its position above $1.12, reaching its highest level since February 2022, on the back of investor expectations that the European Central Bank will continue its rate-hike cycle to tackle inflation and bring it closer to the 2% target. In the Eurozone, inflation declined to a 17-month low of 5.5% in June, but the core rate remained stubbornly high at 5.4%, still close to the all-time high of 5.7% seen in March. Currently, the interest rates in the bloc stand at 3.5%, but traders anticipate rates peaking at 4% by the end of the year. However, a recent batch of weak economic data from across the region might prompt the central bank to revise its inflation forecasts in September, possibly leaving the deposit facility rate at 3.75%. Simultaneously, the recently released weaker-than-expected US inflation data has fueled speculations that the Federal Reserve is nearing the conclusion of its current policy tightening measures.
Comment:
bullish trade open
Comment:
All major US stock indexes finished higher on Tuesday, at the levels not seen since early April 2022, boosted by stronger-than-expected earnings results from some of the country’s top lenders and a rally in AI-linked stocks. The Dow Jones soared over 360 points or 1%, the S&P 500 and the Nasdaq gained 0.7% each. Stocks of Morgan Stanley surged 6.4% after the bank's earnings and revenue beat forecasts. Shares of Bank of N.Y. Mellon added 4.1% after reporting better-than-expected profit and revenue, Bank of America jumped 4.4% after an earnings beat and Charles Schwab jumped 12.5% after reporting stronger profit and revenue. Microsoft shares rose 3.9%, hitting all-time high of $366.78 during the session after announcing a new AI subscription service for Microsoft 365. On the losing end, Masimo tumbled 20% after the medical equipment maker said it expects to report weaker-than-expected revenue for the spring quarter.
Comment:
Bond Yields Continue to Fall
Government bond yields around the world fell for a third day on Wednesday, with the US 10-year Treasury note yield retreating to 3.74%, a fresh low since late June. Investors are getting increasingly convinced that major central banks, and specially the Fed will soon end their tightening campaign. Bets for a 25bps hike in the fed funds rate next week currently stand at 97% but investors remain divided on the need of further increases, with chances for a September increase currently standing at 12% and for November at 23%. Meanwhile, the ECB is also set to raise rates by 25bps again next week while there is just a 70% chance of a further rate rise in September. In the UK, another increase in borrowing costs is seen as certain next month, but a smaller-than-expected inflation reading for June lowered bets on further BOE rate hikes. On the other hand, traders are increasingly speculating the Bank of Japan could adjust its ultra loose monetary policy next week.
European Markets Head for Higher Open
European equity markets were headed for a higher open on Wednesday as investors reacted to data showing the annual consumer inflation in the UK stood at 7.9% in June, the lowest reading since March 2022 and below forecasts of 8.2%. Investors also await final euro zone inflation figures later on Wednesday to guide the economic and monetary policy outlook in the region. Moreover, markets look ahead to the latest earnings report from Dutch chip industry giant ASML, as well as from major US firms such as Tesla, Netflix and Goldman Sachs. DAX and Stoxx 600 futures rose 0.2% in premarket trade, while FTSE 100 futures jumped 0.8%.
Government bond yields around the world fell for a third day on Wednesday, with the US 10-year Treasury note yield retreating to 3.74%, a fresh low since late June. Investors are getting increasingly convinced that major central banks, and specially the Fed will soon end their tightening campaign. Bets for a 25bps hike in the fed funds rate next week currently stand at 97% but investors remain divided on the need of further increases, with chances for a September increase currently standing at 12% and for November at 23%. Meanwhile, the ECB is also set to raise rates by 25bps again next week while there is just a 70% chance of a further rate rise in September. In the UK, another increase in borrowing costs is seen as certain next month, but a smaller-than-expected inflation reading for June lowered bets on further BOE rate hikes. On the other hand, traders are increasingly speculating the Bank of Japan could adjust its ultra loose monetary policy next week.
European Markets Head for Higher Open
European equity markets were headed for a higher open on Wednesday as investors reacted to data showing the annual consumer inflation in the UK stood at 7.9% in June, the lowest reading since March 2022 and below forecasts of 8.2%. Investors also await final euro zone inflation figures later on Wednesday to guide the economic and monetary policy outlook in the region. Moreover, markets look ahead to the latest earnings report from Dutch chip industry giant ASML, as well as from major US firms such as Tesla, Netflix and Goldman Sachs. DAX and Stoxx 600 futures rose 0.2% in premarket trade, while FTSE 100 futures jumped 0.8%.
Comment:
Bond Yields Continue to Fall
Government bond yields around the world fell for a third day on Wednesday, with the US 10-year Treasury note yield retreating to 3.74%, a fresh low since late June. Investors are getting increasingly convinced that major central banks, and specially the Fed will soon end their tightening campaign. Bets for a 25bps hike in the fed funds rate next week currently stand at 97% but investors remain divided on the need of further increases, with chances for a September increase currently standing at 12% and for November at 23%. Meanwhile, the ECB is also set to raise rates by 25bps again next week while there is just a 70% chance of a further rate rise in September. In the UK, another increase in borrowing costs is seen as certain next month, but a smaller-than-expected inflation reading for June lowered bets on further BOE rate hikes. On the other hand, traders are increasingly speculating the Bank of Japan could adjust its ultra loose monetary policy next week.
European Markets Head for Higher Open
European equity markets were headed for a higher open on Wednesday as investors reacted to data showing the annual consumer inflation in the UK stood at 7.9% in June, the lowest reading since March 2022 and below forecasts of 8.2%. Investors also await final euro zone inflation figures later on Wednesday to guide the economic and monetary policy outlook in the region. Moreover, markets look ahead to the latest earnings report from Dutch chip industry giant ASML, as well as from major US firms such as Tesla, Netflix and Goldman Sachs. DAX and Stoxx 600 futures rose 0.2% in premarket trade, while FTSE 100 futures jumped 0.8%.
Government bond yields around the world fell for a third day on Wednesday, with the US 10-year Treasury note yield retreating to 3.74%, a fresh low since late June. Investors are getting increasingly convinced that major central banks, and specially the Fed will soon end their tightening campaign. Bets for a 25bps hike in the fed funds rate next week currently stand at 97% but investors remain divided on the need of further increases, with chances for a September increase currently standing at 12% and for November at 23%. Meanwhile, the ECB is also set to raise rates by 25bps again next week while there is just a 70% chance of a further rate rise in September. In the UK, another increase in borrowing costs is seen as certain next month, but a smaller-than-expected inflation reading for June lowered bets on further BOE rate hikes. On the other hand, traders are increasingly speculating the Bank of Japan could adjust its ultra loose monetary policy next week.
European Markets Head for Higher Open
European equity markets were headed for a higher open on Wednesday as investors reacted to data showing the annual consumer inflation in the UK stood at 7.9% in June, the lowest reading since March 2022 and below forecasts of 8.2%. Investors also await final euro zone inflation figures later on Wednesday to guide the economic and monetary policy outlook in the region. Moreover, markets look ahead to the latest earnings report from Dutch chip industry giant ASML, as well as from major US firms such as Tesla, Netflix and Goldman Sachs. DAX and Stoxx 600 futures rose 0.2% in premarket trade, while FTSE 100 futures jumped 0.8%.
Comment:
Japan will release some key data over the coming days that could provide some directionality for the JPY. The yen hasn’t been acting all that “normally” recently, as traders hang on comments from Japanese officials that might indicate intervention to support the currency.
To make matters more confusing, the head of the BOJ, Kazuo Ueda, has said some things that appear to be contradictory. There’s a ball of forex yarn here that needs to be untangled to get a better idea of where the yen could be headed in the medium-to-long term.
First, the data
Tomorrow, Japan will publish its trade balance which is expected to see a dramatic reduction in the trade deficit to just ¥46.7B from ¥1.37T reported in May. Japan typically has relatively large fluctuations in its trade statistics, but if the forecast is correct, it would be the smallest deficit since the latter part of 2021. The weakness of the currency (and brief recovery earlier this year) have been a key factor affecting the trade balance, which is an important component for the BOJ’s decision-making.
The shrinking deficit is expected to be because imports are forecast to decline while exports are expected to grow. Part of that dynamic is seen as a result of the weaker yen meaning that exports are priced at a higher value. On the other hand, the shrinking imports are a sign of lack of dynamism in the economy. The erosion of purchasing power from a weaker currency could mean Japanese citizens are buying fewer things. That would be a worrying sign for the BOJ.
What’s the BOJ up to?
Just last Sunday, the Governor of the BOJ admitted that the weakness in the yen was a concern, and that the bank could take measures to address it. He used more technical speech, of course, talking about restoring market pricing. But the takeaway is what mattered for the market reaction. Just two days later, on Tuesday, he appeared to backtrack, saying that the BOJ is committed to easing.
This changing commentary shows the dilemma of the BOJ, which wants to keep easing in order to support the economy. That means not worrying about a weaker yen, because that helps exports. But the weaker yen has contributed to rising inflation, and slowing the economy. So the BOJ would be worried about a weaker yen.
Clearing up the situation
Ueda has repeatedly said that he wants to see inflation “sustainably” rising at the target rate of 2%. Inflation has been higher than that for months now. What he means is that the current bout of high inflation is seen as “temporary”, and the result of non-market driven yen weakness that has raised the cost of imported goods. “Non-market driven” here means things like carry trade and bets that the BOJ won’t intervene as the currency weakens. The BOJ is trying to cajole markets into getting the yen higher without actually having to do anything to strengthen the yen.
If inflation turns around and starts rising, however, the BOJ might have to come to the conclusion that they can’t have their cake and eat it too. That might prompt a move towards shoring up the yen, such as widening the YCC again. Japanese annual June inflation is expected to tick up to 3.3% from 3.2% prior.
To make matters more confusing, the head of the BOJ, Kazuo Ueda, has said some things that appear to be contradictory. There’s a ball of forex yarn here that needs to be untangled to get a better idea of where the yen could be headed in the medium-to-long term.
First, the data
Tomorrow, Japan will publish its trade balance which is expected to see a dramatic reduction in the trade deficit to just ¥46.7B from ¥1.37T reported in May. Japan typically has relatively large fluctuations in its trade statistics, but if the forecast is correct, it would be the smallest deficit since the latter part of 2021. The weakness of the currency (and brief recovery earlier this year) have been a key factor affecting the trade balance, which is an important component for the BOJ’s decision-making.
The shrinking deficit is expected to be because imports are forecast to decline while exports are expected to grow. Part of that dynamic is seen as a result of the weaker yen meaning that exports are priced at a higher value. On the other hand, the shrinking imports are a sign of lack of dynamism in the economy. The erosion of purchasing power from a weaker currency could mean Japanese citizens are buying fewer things. That would be a worrying sign for the BOJ.
What’s the BOJ up to?
Just last Sunday, the Governor of the BOJ admitted that the weakness in the yen was a concern, and that the bank could take measures to address it. He used more technical speech, of course, talking about restoring market pricing. But the takeaway is what mattered for the market reaction. Just two days later, on Tuesday, he appeared to backtrack, saying that the BOJ is committed to easing.
This changing commentary shows the dilemma of the BOJ, which wants to keep easing in order to support the economy. That means not worrying about a weaker yen, because that helps exports. But the weaker yen has contributed to rising inflation, and slowing the economy. So the BOJ would be worried about a weaker yen.
Clearing up the situation
Ueda has repeatedly said that he wants to see inflation “sustainably” rising at the target rate of 2%. Inflation has been higher than that for months now. What he means is that the current bout of high inflation is seen as “temporary”, and the result of non-market driven yen weakness that has raised the cost of imported goods. “Non-market driven” here means things like carry trade and bets that the BOJ won’t intervene as the currency weakens. The BOJ is trying to cajole markets into getting the yen higher without actually having to do anything to strengthen the yen.
If inflation turns around and starts rising, however, the BOJ might have to come to the conclusion that they can’t have their cake and eat it too. That might prompt a move towards shoring up the yen, such as widening the YCC again. Japanese annual June inflation is expected to tick up to 3.3% from 3.2% prior.
Comment:
itcoin lagging gold despite weakening dollar: A Bitcoin, gold, USD analysis
The dollar continues to weak, now 12.5% off its 20-year high last year
Gold and Bitcoin tend to strengthen when the dollar falls
The relationship has turned this week though with Bitcoin lagging
The dollar continues to get hammered.
After dominating virtually every currency throughout the COVID pandemic, the DXY index, which measures the strength of the greenback against a basket of major currencies, hit a twenty-year high in Q4 of last year. Since then, however, it has shed 12.5% of its value.
The fall comes as inflation continues to cool, with the most recent CPI data putting year-over-year inflation at 3%. While core inflation remains a little stickier, the market is nonetheless betting that one of the fastest rate-hiking cycles in recent history is finally coming to a close.
The dollar strengthens in times of uncertainty because correlations go to one in a crisis, while there is a flight to safety as investors peel back on the risk curve. And there is no safer asset than the global reserve currency, so the dollar picks up steam in such turbulent periods.
While the last couple of years do not quantify as a recession, the turbulent climate which has arisen out of rampant inflation and spiking interest rates (not to mention a once-in-a generation global pandemic and all the bespoke economic fallout that entailed) has caused mass uncertainty. This in turn has increased the attractiveness of the dollar.
Additionally, the faster pace of interest rates in the US compared to many nations worldwide has encouraged capital to flow into the greenback. But with inflation cooling off and the market betting the rate hiking cycle is now nearing its conclusion, the climate has changed – and the dollar has pulled back as a result.
How are other assets affected by the dollar?
This is all relatively straight-forward, but what does this mean for other assets?
Well, as mentioned above, the dollar is the global reserve currency, meaning it is also the lifeblood of the global financial system. In such a way, the effects are widespread. If we look at the classic example of gold, a falling dollar means it takes more dollars to purchase the same amount of gold (and vice-versa). So we tend to see gold rise when the dollar falls, even if it may be nothing to do with gold itself.
In the next chart, I have plotted the correlation between the dollar index and gold over the last year, which shows a strong negative relationship in the -0.8 to -0.9 range for much of the period (albeit with a recent weakening).
Let’s now look at Bitcoin, gold’s wannabe best friend.With Bitcoin far more volatile as an asset than gold, and given the numerous crypto-specific scandals (Terra, Celsius, FTX etc) of the past year, this is unsurprising.Why is Bitcoin selling off amid dollar weakness?
This takes us to an interesting finding: why is Bitcoin not being buoyed by this weaker dollar? Gold is up 2.4% in the last week, taking advantage of the dollar’s dip. On the other hand, Bitcoin has actually fallen slightly, which goes against trend.
In truth, I am not really sure why the buying activity has been subdued. Perhaps buyers did their part after the XRP ruling last week, and are hesitant to pile further in while the market finds its footing. But that is a shaky theory at best.
Even looking at miners in the next chart, we can see that they are offloading Bitcoin rather than buying, which they have been doing since the start of the month. It seems that for whatever reason, there are just not as many buyers out there in the last week compared to normal, and the sell pressure has not been soaked up by a softening dollar. To be clear, this is far from alarming and a totally benign occurrence. My gut feeling is that this is simply a summer lag, which has tended to see the lowest trading activity in Bitcoin markets in the past, too.
Either way, it’s an interesting little tidbit. The relationship between gold, Bitcoin and dollar is always fascinating to track as it incorporates so much macro and so many intriguing variables, so it is worth keeping an eye on. If the trend continues to deviate, a deeper analysis may be warranted. But for now, it feels OK to assume this is just buyers taking a little summer break, and a minor abnormality.
The dollar continues to weak, now 12.5% off its 20-year high last year
Gold and Bitcoin tend to strengthen when the dollar falls
The relationship has turned this week though with Bitcoin lagging
The dollar continues to get hammered.
After dominating virtually every currency throughout the COVID pandemic, the DXY index, which measures the strength of the greenback against a basket of major currencies, hit a twenty-year high in Q4 of last year. Since then, however, it has shed 12.5% of its value.
The fall comes as inflation continues to cool, with the most recent CPI data putting year-over-year inflation at 3%. While core inflation remains a little stickier, the market is nonetheless betting that one of the fastest rate-hiking cycles in recent history is finally coming to a close.
The dollar strengthens in times of uncertainty because correlations go to one in a crisis, while there is a flight to safety as investors peel back on the risk curve. And there is no safer asset than the global reserve currency, so the dollar picks up steam in such turbulent periods.
While the last couple of years do not quantify as a recession, the turbulent climate which has arisen out of rampant inflation and spiking interest rates (not to mention a once-in-a generation global pandemic and all the bespoke economic fallout that entailed) has caused mass uncertainty. This in turn has increased the attractiveness of the dollar.
Additionally, the faster pace of interest rates in the US compared to many nations worldwide has encouraged capital to flow into the greenback. But with inflation cooling off and the market betting the rate hiking cycle is now nearing its conclusion, the climate has changed – and the dollar has pulled back as a result.
How are other assets affected by the dollar?
This is all relatively straight-forward, but what does this mean for other assets?
Well, as mentioned above, the dollar is the global reserve currency, meaning it is also the lifeblood of the global financial system. In such a way, the effects are widespread. If we look at the classic example of gold, a falling dollar means it takes more dollars to purchase the same amount of gold (and vice-versa). So we tend to see gold rise when the dollar falls, even if it may be nothing to do with gold itself.
In the next chart, I have plotted the correlation between the dollar index and gold over the last year, which shows a strong negative relationship in the -0.8 to -0.9 range for much of the period (albeit with a recent weakening).
Let’s now look at Bitcoin, gold’s wannabe best friend.With Bitcoin far more volatile as an asset than gold, and given the numerous crypto-specific scandals (Terra, Celsius, FTX etc) of the past year, this is unsurprising.Why is Bitcoin selling off amid dollar weakness?
This takes us to an interesting finding: why is Bitcoin not being buoyed by this weaker dollar? Gold is up 2.4% in the last week, taking advantage of the dollar’s dip. On the other hand, Bitcoin has actually fallen slightly, which goes against trend.
In truth, I am not really sure why the buying activity has been subdued. Perhaps buyers did their part after the XRP ruling last week, and are hesitant to pile further in while the market finds its footing. But that is a shaky theory at best.
Even looking at miners in the next chart, we can see that they are offloading Bitcoin rather than buying, which they have been doing since the start of the month. It seems that for whatever reason, there are just not as many buyers out there in the last week compared to normal, and the sell pressure has not been soaked up by a softening dollar. To be clear, this is far from alarming and a totally benign occurrence. My gut feeling is that this is simply a summer lag, which has tended to see the lowest trading activity in Bitcoin markets in the past, too.
Either way, it’s an interesting little tidbit. The relationship between gold, Bitcoin and dollar is always fascinating to track as it incorporates so much macro and so many intriguing variables, so it is worth keeping an eye on. If the trend continues to deviate, a deeper analysis may be warranted. But for now, it feels OK to assume this is just buyers taking a little summer break, and a minor abnormality.
Comment:
This trade is stil open and active
relevant market wraps
European Markets Head for Muted Open
European equity markets were headed for a muted open on Thursday as investors braced for the start of the earnings season in the region. Major European firms slated to report earnings today include SAP, EasyJet, Volvo Car, Publicis, ABB and Nokia. Investors also turned cautious after shares of key technology names in the US dropped in post-market trade on disappointing quarterly results. DAX, Stoxx 600 and FTSE 100 futures all fluctuated around the flatline in premarket trade.
Gold Hits 2-Month High on Fed Pause Bets
Japan 10-Year Yield Steadies Around 0.46%
Japan’s 10-year government bond yield steadied around 0.46% as a dovish outlook on Bank of Japan monetary policy kept the benchmark yield below the upper limit of the target range. BOJ Governor Kazuo Ueda recently stated that there was still some distance to sustainably and stably achieve the central bank’s 2% inflation target, indicating the BOJ’s commitment to ultra-easy monetary policy. Last month, the central bank held its short-term interest rate target at -0.1% and that of 10-year bond yields at around 0% by a unanimous vote, in line with expectations. Falling bond yields in other major economies also reduced upward pressure on JGB yields, as easing inflationary pressures raised hopes that the end of the current monetary policy tightening cycle is close.
Japan Raises This Year’s Price View to 2.6% Ahead of BOJ Meet
The Japanese government raised its overall inflation forecast to 2.6% for the current fiscal year ahead of the central bank’s policy decision meeting next week, the Cabinet Office said Thursday. The upward revision from the previous forecast of 1.7% shows stronger-than-expected inflationary pressure. Japan saw that trend holding up even after accounting for government price-relief measures, which the Cabinet Office says shaves 0.5 percentage points off this year’s price reading. For fiscal 2024, the government expects overall inflation to slow to 1.9%.
relevant market wraps
European Markets Head for Muted Open
European equity markets were headed for a muted open on Thursday as investors braced for the start of the earnings season in the region. Major European firms slated to report earnings today include SAP, EasyJet, Volvo Car, Publicis, ABB and Nokia. Investors also turned cautious after shares of key technology names in the US dropped in post-market trade on disappointing quarterly results. DAX, Stoxx 600 and FTSE 100 futures all fluctuated around the flatline in premarket trade.
Gold Hits 2-Month High on Fed Pause Bets
Japan 10-Year Yield Steadies Around 0.46%
Japan’s 10-year government bond yield steadied around 0.46% as a dovish outlook on Bank of Japan monetary policy kept the benchmark yield below the upper limit of the target range. BOJ Governor Kazuo Ueda recently stated that there was still some distance to sustainably and stably achieve the central bank’s 2% inflation target, indicating the BOJ’s commitment to ultra-easy monetary policy. Last month, the central bank held its short-term interest rate target at -0.1% and that of 10-year bond yields at around 0% by a unanimous vote, in line with expectations. Falling bond yields in other major economies also reduced upward pressure on JGB yields, as easing inflationary pressures raised hopes that the end of the current monetary policy tightening cycle is close.
Japan Raises This Year’s Price View to 2.6% Ahead of BOJ Meet
The Japanese government raised its overall inflation forecast to 2.6% for the current fiscal year ahead of the central bank’s policy decision meeting next week, the Cabinet Office said Thursday. The upward revision from the previous forecast of 1.7% shows stronger-than-expected inflationary pressure. Japan saw that trend holding up even after accounting for government price-relief measures, which the Cabinet Office says shaves 0.5 percentage points off this year’s price reading. For fiscal 2024, the government expects overall inflation to slow to 1.9%.
Comment:
Japan Inflation Rate Below Estimates in JuneJapan Inflation Rate
The annual inflation rate in Japan edged up to 3.3% in June 2023 from 3.2% in May but less than market forecasts of 3.5%. Core inflation also ticked higher to 3.3% in June from 3.2% in May, matching consensus but staying outside the Bank of Japan's 2% target for the 15th month. On a monthly basis, consumer prices rose 0.2% after being flat in May.
Dow Extends Winning Streak, Tech Drag
The Dow Jones closed 163 points higher on Thursday, marking its ninth-straight session of gains and its longest winning streak since September 2017. Meanwhile, the S&P 500 and the Nasdaq lost 0.7% and 2%, respectively dragged by tech shares as latest corporate earnings were in focus. Johnson & Johnson was the top performer and soared around 6% on upbeat revenue and earnings, helping propel the Dow. Travelers added 1.8% higher after beating on revenue but falling short of expectations on earnings. IBM shares were nearly 2.1% higher despite its disappointing revenue. Conversely, Netflix lost 8.4% after the company's revenue missed forecasts. Also, Tesla tumbled 9.7%, its biggest daily percentage drop since April 20 after reporting a drop in its second-quarter gross margins to a four-year low and Elon Musk hinted at more price cuts. Blackstone moved 0.7% lower after a 39% drop in earnings and American Airlines sank 6.2% despite raising its earnings outlook for 2023.
The annual inflation rate in Japan edged up to 3.3% in June 2023 from 3.2% in May but less than market forecasts of 3.5%. Core inflation also ticked higher to 3.3% in June from 3.2% in May, matching consensus but staying outside the Bank of Japan's 2% target for the 15th month. On a monthly basis, consumer prices rose 0.2% after being flat in May.
Dow Extends Winning Streak, Tech Drag
The Dow Jones closed 163 points higher on Thursday, marking its ninth-straight session of gains and its longest winning streak since September 2017. Meanwhile, the S&P 500 and the Nasdaq lost 0.7% and 2%, respectively dragged by tech shares as latest corporate earnings were in focus. Johnson & Johnson was the top performer and soared around 6% on upbeat revenue and earnings, helping propel the Dow. Travelers added 1.8% higher after beating on revenue but falling short of expectations on earnings. IBM shares were nearly 2.1% higher despite its disappointing revenue. Conversely, Netflix lost 8.4% after the company's revenue missed forecasts. Also, Tesla tumbled 9.7%, its biggest daily percentage drop since April 20 after reporting a drop in its second-quarter gross margins to a four-year low and Elon Musk hinted at more price cuts. Blackstone moved 0.7% lower after a 39% drop in earnings and American Airlines sank 6.2% despite raising its earnings outlook for 2023.
Comment:
trade is open
Comment:
trade is open
Comment:
trade is open.
Trade setup as on the chart above explained and mentioned is open(See the Time Frame): The Trade setup above is only based on daily,weekly,monthly and 4 Hours timeframe. For daytraders who are involved on lower time frame you need to calculate or possibly use your other strategies. The trade setup above is only created for trend followers, also daytraders can benefit of it, if they choose to.
Trade setup as on the chart above explained and mentioned is open(See the Time Frame): The Trade setup above is only based on daily,weekly,monthly and 4 Hours timeframe. For daytraders who are involved on lower time frame you need to calculate or possibly use your other strategies. The trade setup above is only created for trend followers, also daytraders can benefit of it, if they choose to.
Comment:
trade is open.
Trade setup as on the chart above explained and mentioned is open(See the Time Frame): The Trade setup above is only based on daily,weekly,monthly and 4 Hours timeframe. For daytraders who are involved on lower time frame you need to calculate or possibly use your other strategies. The trade setup above is only created for trend followers, also daytraders can benefit of it, if they choose to.
Trade setup as on the chart above explained and mentioned is open(See the Time Frame): The Trade setup above is only based on daily,weekly,monthly and 4 Hours timeframe. For daytraders who are involved on lower time frame you need to calculate or possibly use your other strategies. The trade setup above is only created for trend followers, also daytraders can benefit of it, if they choose to.
Comment:
Low volatility next week till friday. The pullbacks are profit takings, low trading volume and low volatility of the market makers.
Trading oppurtunities are in USD FX specially USD JPY...Keep monitor them closely.
Trading oppurtunities are in USD FX specially USD JPY...Keep monitor them closely.
Comment:
Dow Rises for 11th Session
The Dow Jones added nearly 100 points to book an 11th straight session of gains on Monday, with Chevron among the top performers (1.8%) after reporting better-than-expected earnings. Meanwhile, the S&P 500 was up about 0.3%, led by a nearly 1.5% gain for the energy sector, namely shares of Halliburton (2.5%), as oil prices touched a three-month high. On the other hand, the Nasdaq failed to hold early gains and was down about 0.2%, with Amazon (-1.2%) and Tesla (-0.7%) weighing. Investors brace for the Fed's monetary policy decision on Wednesday, with another 25bps increase in the fed funds rate already priced in, although traders will be looking for any clues on whether the Fed will stop the tightening cycle or believes further increases are still necessary. Meanwhile, the earnings season continues with about 40% of the Dow and 30% of the S&P 500 giving their financial updates during the week, including Alphabet, Meta Platforms, Microsoft, GE, 3M, General Motors, Boeing and Amazon.
US Private Sector Growth Slows to 5-Month Low
The S&P Global US Composite PMI declined to 52.0 in July 2023, down from 53.2 the previous month, as shown in a preliminary estimate. The latest reading indicated the softest pace of expansion in private sector business activity since February, with service activity growth easing to a five-month low, and manufacturing output levels remaining relatively unchanged. Total new orders rose the least since April, amid reports of constraints on client spending, including higher interest rates, while the rate of job creation was only marginal, marking the weakest level since January. On the price front, input prices increased the least since October 2020, while the rate of output charge inflation picked up as firms sought to pass through higher costs and increased interest rate payments to customers. Finally, business confidence dipped to the lowest level so far this year.
The Dow Jones added nearly 100 points to book an 11th straight session of gains on Monday, with Chevron among the top performers (1.8%) after reporting better-than-expected earnings. Meanwhile, the S&P 500 was up about 0.3%, led by a nearly 1.5% gain for the energy sector, namely shares of Halliburton (2.5%), as oil prices touched a three-month high. On the other hand, the Nasdaq failed to hold early gains and was down about 0.2%, with Amazon (-1.2%) and Tesla (-0.7%) weighing. Investors brace for the Fed's monetary policy decision on Wednesday, with another 25bps increase in the fed funds rate already priced in, although traders will be looking for any clues on whether the Fed will stop the tightening cycle or believes further increases are still necessary. Meanwhile, the earnings season continues with about 40% of the Dow and 30% of the S&P 500 giving their financial updates during the week, including Alphabet, Meta Platforms, Microsoft, GE, 3M, General Motors, Boeing and Amazon.
US Private Sector Growth Slows to 5-Month Low
The S&P Global US Composite PMI declined to 52.0 in July 2023, down from 53.2 the previous month, as shown in a preliminary estimate. The latest reading indicated the softest pace of expansion in private sector business activity since February, with service activity growth easing to a five-month low, and manufacturing output levels remaining relatively unchanged. Total new orders rose the least since April, amid reports of constraints on client spending, including higher interest rates, while the rate of job creation was only marginal, marking the weakest level since January. On the price front, input prices increased the least since October 2020, while the rate of output charge inflation picked up as firms sought to pass through higher costs and increased interest rate payments to customers. Finally, business confidence dipped to the lowest level so far this year.
Comment:
masdaq bullish after FOMC , I bouht more nowmy target stays at 21000
Next FED meeting in nov. december is much more important..
long dow jones long rty long indices and stocks
Next FED meeting in nov. december is much more important..
long dow jones long rty long indices and stocks
Comment:
Trade open
Long
VIX DOWN DXY DOWN
The US economy grew 2.4% GDP in Q2
US Futures Extend Gains after Upbeat GDP Growth
US stock futures extended gains on Thursday, with contracts on the Dow Jones jumping about 170 points, S&P 500 gaining 0.9% and the Nasdaq 100 up 1.6% as investors cheered fresh data and corporate earnings results. The US economy grew 2.4% GDP in Q2, surpassing market expectations of 1.8% expansion in a sign the US economy remains resilient despite high-interest rates. Meanwhile, Meta Platforms surged about 10% in premarket trading after reporting strong earnings and profit and a better-than-expected forecast for the current period. Comcast jumped over 2.5% after earnings and revenue came higher than anticipated and McDonald's was up about 1.3% after sales topped forecasts. Mastercard was also in the green (0.6%) after delivering strong revenue and earnings growth. Intel, Ford and T-Mobile are due to report today after the closing bell.
US Initial Jobless Claims Fall to 5-Month Low
US GDP Grows at a Stronger 2.4%
Long
VIX DOWN DXY DOWN
The US economy grew 2.4% GDP in Q2
US Futures Extend Gains after Upbeat GDP Growth
US stock futures extended gains on Thursday, with contracts on the Dow Jones jumping about 170 points, S&P 500 gaining 0.9% and the Nasdaq 100 up 1.6% as investors cheered fresh data and corporate earnings results. The US economy grew 2.4% GDP in Q2, surpassing market expectations of 1.8% expansion in a sign the US economy remains resilient despite high-interest rates. Meanwhile, Meta Platforms surged about 10% in premarket trading after reporting strong earnings and profit and a better-than-expected forecast for the current period. Comcast jumped over 2.5% after earnings and revenue came higher than anticipated and McDonald's was up about 1.3% after sales topped forecasts. Mastercard was also in the green (0.6%) after delivering strong revenue and earnings growth. Intel, Ford and T-Mobile are due to report today after the closing bell.
US Initial Jobless Claims Fall to 5-Month Low
US GDP Grows at a Stronger 2.4%
Comment:
US Stocks on Track to End July More than 3% Higher
Comment:
Nasdaq SP500 Dow Reversal
Trend up US 10-Year Treasury Auction Sees Decent Demand Despite Yield Under 4%
DCY down
Oil UP
Nasdaq Bullish
Dow Bullish
RTY Bullish
SP500 Bullish
Wait for CPI today. Possible Correction(I hope so that the makrket goes down first to 15000-14500) That is exactly the Gap Fill ,before Nasdaq Flies to 15850 and 16250 2nd Gap FILL)...So ge ready ,wait and watch closely the supports and resistances,better with Divergenes. In the chats and social media a lot of amateur traders are nervouse, becuz no trading experiences.So stop listening to them...Chats will cost you money. Instead relax,wait,have patience till we get the buy zones. Read comments above. I mentioned already Picadelli Points.
Trend up US 10-Year Treasury Auction Sees Decent Demand Despite Yield Under 4%
DCY down
Oil UP
Nasdaq Bullish
Dow Bullish
RTY Bullish
SP500 Bullish
Wait for CPI today. Possible Correction(I hope so that the makrket goes down first to 15000-14500) That is exactly the Gap Fill ,before Nasdaq Flies to 15850 and 16250 2nd Gap FILL)...So ge ready ,wait and watch closely the supports and resistances,better with Divergenes. In the chats and social media a lot of amateur traders are nervouse, becuz no trading experiences.So stop listening to them...Chats will cost you money. Instead relax,wait,have patience till we get the buy zones. Read comments above. I mentioned already Picadelli Points.
Comment:
Trade open
Comment:
Powell's Dovish Comments Send Everything Soaring, Gold Hits All Time High As US Dollar Plummets
After November's furious meltup, which saw the S&P rise by 9% (the Nasdaq was up an even more ludicrous 11%), which was the best November for the stock market since 1980...
all eyes were on Jerome Powell today to see if the Fed chair would say something to stem the surging stock market tide following the month which saw the biggest easing in financial conditions on record, equivalent to nearly 4 rate cuts.
SPOT GOLD EXTENDS GAINS TO HIT ALL-TIME HIGH, LAST UP 1.5% AT $2,074 PER OUNCE
And while that may only add more fuel to the rate-cut speculation, at some point the softening in economic data will have to be squared with its impact on profits. As a reminder, while much of the interval between the last rate hike and the first rate cut is favorable for risk assets, the weeks right before the cut usually send stocks anywhere between 10% and 30% lower as the market realizes just why the Fed is panicking.
After November's furious meltup, which saw the S&P rise by 9% (the Nasdaq was up an even more ludicrous 11%), which was the best November for the stock market since 1980...
all eyes were on Jerome Powell today to see if the Fed chair would say something to stem the surging stock market tide following the month which saw the biggest easing in financial conditions on record, equivalent to nearly 4 rate cuts.
SPOT GOLD EXTENDS GAINS TO HIT ALL-TIME HIGH, LAST UP 1.5% AT $2,074 PER OUNCE
And while that may only add more fuel to the rate-cut speculation, at some point the softening in economic data will have to be squared with its impact on profits. As a reminder, while much of the interval between the last rate hike and the first rate cut is favorable for risk assets, the weeks right before the cut usually send stocks anywhere between 10% and 30% lower as the market realizes just why the Fed is panicking.
Comment:
Bullish BUY
JOLTS Falling job openings could confirm US labor market is losing steam ISM up
JOLTS Falling job openings could confirm US labor market is losing steam ISM up
Comment:
bullish
US Trade Balance down, Dollar down, shares up, Nasdaq bullish
US Trade Balance down, Dollar down, shares up, Nasdaq bullish
Comment:
US100
Bullish
CRUDE OIL strong bearish...Further Signals below...
ADP Non-Farm Employment Change far below expectations 103K ,Forecast was 131. The US economy is slowing down, ,good for NQ, as Inflation forecasting down now.Interest rates sentiment is increasing.Bullish sentiment is now above 74% Bearih sentiment below 18.75. NQ COT report(lat Friday shows commercials start to buy NQ). Posible FED Fund cut early next year,Feb/Mach 2024.
Further signals: Crude Oil WTI,.... Bearih short, Gold Bullish, BTCUSD Bullish, EURUSD Bullih, GBPUD BULLISH, USDJPY bearih, EURJPY bearish, GBPJPY bearih, DAX40(Germany40) bullish, EU50 bullih, Dow Jones Bullish; US Dollar down bearish, RTY bullish, Coffee Arabica Bullish, Palladium Bearish, Platinum bullish, Ethereum UD Bullish
US100
Bullish CRUDE OIL strong bearish...Further Signals below...
ADP Non-Farm Employment Change far below expectations 103K ,Forecast was 131. The US economy is slowing down, ,good for NQ, as Inflation forecasting down now.Interest rates sentiment is increasing.Bullish sentiment is now above 74% Bearih sentiment below 18.75. NQ COT report(lat Friday shows commercials start to buy NQ). Posible FED Fund cut early next year,Feb/Mach 2024.
Further signals: Crude Oil WTI,.... Bearih short, Gold Bullish, BTCUSD Bullish, EURUSD Bullih, GBPUD BULLISH, USDJPY bearih, EURJPY bearish, GBPJPY bearih, DAX40(Germany40) bullish, EU50 bullih, Dow Jones Bullish; US Dollar down bearish, RTY bullish, Coffee Arabica Bullish, Palladium Bearish, Platinum bullish, Ethereum UD Bullish
Comment:
US100
Strong bullih now 245min. TF beginning to pump
16050, 16182,16200,16250 next If breaing that level we will see soon ALL TIME High of Nadaq 2021. 16775 after that, and then 17000 ..not necesarily today, as tomorrow and on Friday further Inflation data. the Bias is bullish.. but at the end of this week or until the end of 2023..(unles the economy continues to cool down). Other catalysts lie sudden middle east war, could stop the bullish trend and revere it..But currently Israel starts the diplomatic talks, thats good for U shares and Nasdaq
US100
Strong bullih now 245min. TF beginning to pump 16050, 16182,16200,16250 next If breaing that level we will see soon ALL TIME High of Nadaq 2021. 16775 after that, and then 17000 ..not necesarily today, as tomorrow and on Friday further Inflation data. the Bias is bullish.. but at the end of this week or until the end of 2023..(unles the economy continues to cool down). Other catalysts lie sudden middle east war, could stop the bullish trend and revere it..But currently Israel starts the diplomatic talks, thats good for U shares and Nasdaq
Comment:
US100
bullish
But dont buy yet.WAIT!!! The uptrend will revere again.
Unemployment Claims unchanged, but Job cuts increase, Inflation down. currently 30 min. trend is down, wait to change the 30 min. trend bullish, and then buy the weekly support at 15747-15800. Today is no trend day, meaning we buy, and set profit targets. Bonds high,but US Dollar down, We posibly go down to upport and sideways, as the market waiting for tomorrows important Non-Farm Employment Change
US100
bullish But dont buy yet.WAIT!!! The uptrend will revere again.
Unemployment Claims unchanged, but Job cuts increase, Inflation down. currently 30 min. trend is down, wait to change the 30 min. trend bullish, and then buy the weekly support at 15747-15800. Today is no trend day, meaning we buy, and set profit targets. Bonds high,but US Dollar down, We posibly go down to upport and sideways, as the market waiting for tomorrows important Non-Farm Employment Change
Comment:
TREND BULLISH
IMPORTANT US DATA ARE:
Federal Funds Rate VERY IMPORTANT FED MEETING NEXT WEDNESDAY Dec.13th 2023
Current FED rates at 5.25/5.5
Estimation no rate hikes : 97,7%
Estimation rate-cuts(easing) :2,3%
FRIDAY DATA 8th Dec: Very important
-Non-Farm Employment Change if unchanged or below etimates ,good for Nasdaq,Gold,BTCUSD and all markets against US Dollar
-Unemployment Rate: If greater than forecast good for Nasdaq,Gold,BTCUSD and all markets against US Dollar
-Average Hourly Earnings m/m if less than forecast, good for Nasdaq,Gold,BTCUSD and all markets against US Dollar
-Prelim UoM Consumer Sentiment and Prelim UoM Inflation Expectations:If less than expected, good for Nasdaq,Gold,BTCUSD and all markets against US Dollar
Technical Bullish Signals: Gold broke above important Reistance 2084, but could not held above. Trend is bullish. My Buy signals and Long trades are active. My buying and hold prices still are: 1940. 1807,1800,1700,1658(Begin of Long trend
Important bullish supports to buy again are:
1956
1915
1787
1701
1696
Abeakbelow 1696 will initiate a short term bearish trend.
IMPORTANT US DATA ARE:
Federal Funds Rate VERY IMPORTANT FED MEETING NEXT WEDNESDAY Dec.13th 2023
Current FED rates at 5.25/5.5
Estimation no rate hikes : 97,7%
Estimation rate-cuts(easing) :2,3%
FRIDAY DATA 8th Dec: Very important
-Non-Farm Employment Change if unchanged or below etimates ,good for Nasdaq,Gold,BTCUSD and all markets against US Dollar
-Unemployment Rate: If greater than forecast good for Nasdaq,Gold,BTCUSD and all markets against US Dollar
-Average Hourly Earnings m/m if less than forecast, good for Nasdaq,Gold,BTCUSD and all markets against US Dollar
-Prelim UoM Consumer Sentiment and Prelim UoM Inflation Expectations:If less than expected, good for Nasdaq,Gold,BTCUSD and all markets against US Dollar
Technical Bullish Signals: Gold broke above important Reistance 2084, but could not held above. Trend is bullish. My Buy signals and Long trades are active. My buying and hold prices still are: 1940. 1807,1800,1700,1658(Begin of Long trend
Important bullish supports to buy again are:
1956
1915
1787
1701
1696
Abeakbelow 1696 will initiate a short term bearish trend.
Comment:
Strong US Job Growth Seen in November as Strikes End; Trend Slowing
Also detailled explanation of todays trading on my live stream
US100 Nasdaq Non-Farm Payroll 8th DEC 2023
www.tradingview.com/streams/k4EtkecpNk/
Inter- and Intra market divergence.... Mixed data(so we are waiting to catch the bet potential price. Patience is key.
U.S. job growth likely picked up in November as thousands of automobile workers and actors returned after strikes, but the underlying trend will probably point to a cooling labor market.
Also detailled explanation of todays trading on my live stream
US100 Nasdaq Non-Farm Payroll 8th DEC 2023
www.tradingview.com/streams/k4EtkecpNk/
Inter- and Intra market divergence.... Mixed data(so we are waiting to catch the bet potential price. Patience is key.
U.S. job growth likely picked up in November as thousands of automobile workers and actors returned after strikes, but the underlying trend will probably point to a cooling labor market.
Comment:
FOMC MEETING
on 13th Dec 2023
99% Probability of ,,NO RATE HIKE,,
That is boosting Gold, Shares and Nasdaq
Current US Dollar recovery is caused by Profit Taking
on 13th Dec 2023
99% Probability of ,,NO RATE HIKE,,
That is boosting Gold, Shares and Nasdaq
Current US Dollar recovery is caused by Profit Taking
Comment:
Long Term
Bullish
Short term Bearish
Potential Support 1936
1825
Bullish
Short term Bearish
Potential Support 1936
1825
Comment:
FED FUNDS RATES UNCHANGED
bullish
we added positions
bullish
we added positions
Comment:
Fed Pivot Toward Interest Rate Cuts in 2024 and Gold’s Bullish Response
The Federal Reserve concluded its last FOMC meeting of the year, and as expected, they kept their benchmark interest rate unchanged.
Seventeen voting members are all predicting interest rate cuts next year, with five officials projecting a decrease of ¾%, five officials anticipating a larger rate cut than ¾%, and the remaining two voting members anticipating no rate cuts next year. According to their economic projections, the Fed believes core inflation will peak at 2.4% next year, which is lower than its projections in September of 2.6%.
The Federal Reserve is also projecting inflation will cool to 2.2% in 2025 and 2.0% in 2026. Their projections anticipate unemployment rising to 4.1% in 2024 and remaining at that level through 2026. The Fed also anticipates an economic deceleration forecasting growth at 1.4% next year, and rising to 1.8% in 2025 and 1.9% in 2026
The Federal Reserve concluded its last FOMC meeting of the year, and as expected, they kept their benchmark interest rate unchanged.
Seventeen voting members are all predicting interest rate cuts next year, with five officials projecting a decrease of ¾%, five officials anticipating a larger rate cut than ¾%, and the remaining two voting members anticipating no rate cuts next year. According to their economic projections, the Fed believes core inflation will peak at 2.4% next year, which is lower than its projections in September of 2.6%.
The Federal Reserve is also projecting inflation will cool to 2.2% in 2025 and 2.0% in 2026. Their projections anticipate unemployment rising to 4.1% in 2024 and remaining at that level through 2026. The Fed also anticipates an economic deceleration forecasting growth at 1.4% next year, and rising to 1.8% in 2025 and 1.9% in 2026
Comment:
Treasury yields hit lowest since August, fueling market optimism
U.S. stock futures climb as Fed hints at 2024 rate cuts; Dow hits all-time high.
Fed Open Market Committee keeps rates steady; markets react positively to dovish outlook.
Post-Fed, Treasury yields drop to lowest since August, signaling economic optimism.
U.S. stock futures experienced a significant uplift Wednesday night, following the Federal Reserve’s indication of possible rate cuts in 2024.
US DOLLAR DOWN YIELDS DOWN ASSETS vs Dollar UP
Federal Reserve’s Rate Cut Signal
The Federal Open Market Committee maintained interest rates between 5.25% and 5.5%, aligning with market expectations. However, the revelation of potential rate cuts in 2024 spurred a positive shift in market sentiment. The Fed’s decision, signifying the potential end of a cycle that included 11 rate hikes, has been viewed as a pivot towards a softer monetary policy approach
Impact on Treasury Yields
The Fed’s announcement influenced Treasury yields, with the 10-year note hitting its lowest since August. The dovish outlook implies further cuts through 2025 and 2026, potentially lowering the fed funds rate to 2%-2.25%. This forecast aligns with a brighter inflation outlook, as indicated by recent consumer and wholesale price data
Solar Stocks Respond Positively
The Invesco Solar ETF (TAN) saw a significant increase, with constituent stocks like Enphase Energy, SolarEdge Technologies, and Sunrun recording notable gains. This uptrend reflects the solar industry’s sensitivity to interest rates, as lower rates could reduce financing costs and improve valuations.
U.S. stock futures climb as Fed hints at 2024 rate cuts; Dow hits all-time high.
Fed Open Market Committee keeps rates steady; markets react positively to dovish outlook.
Post-Fed, Treasury yields drop to lowest since August, signaling economic optimism.
U.S. stock futures experienced a significant uplift Wednesday night, following the Federal Reserve’s indication of possible rate cuts in 2024.
US DOLLAR DOWN YIELDS DOWN ASSETS vs Dollar UP
Federal Reserve’s Rate Cut Signal
The Federal Open Market Committee maintained interest rates between 5.25% and 5.5%, aligning with market expectations. However, the revelation of potential rate cuts in 2024 spurred a positive shift in market sentiment. The Fed’s decision, signifying the potential end of a cycle that included 11 rate hikes, has been viewed as a pivot towards a softer monetary policy approach
Impact on Treasury Yields
The Fed’s announcement influenced Treasury yields, with the 10-year note hitting its lowest since August. The dovish outlook implies further cuts through 2025 and 2026, potentially lowering the fed funds rate to 2%-2.25%. This forecast aligns with a brighter inflation outlook, as indicated by recent consumer and wholesale price data
Solar Stocks Respond Positively
The Invesco Solar ETF (TAN) saw a significant increase, with constituent stocks like Enphase Energy, SolarEdge Technologies, and Sunrun recording notable gains. This uptrend reflects the solar industry’s sensitivity to interest rates, as lower rates could reduce financing costs and improve valuations.
Comment:
GDP DOWN
unemployment claimes up
Bullish
we added our longs at 2022 and 2024
SL 1943
Profit target 1(if not manually closed) 2136-2144
pROFIT TARGET 2 2303
unemployment claimes up
Bullish
we added our longs at 2022 and 2024
SL 1943
Profit target 1(if not manually closed) 2136-2144
pROFIT TARGET 2 2303
Comment:
Core PCE data keeps pressure on USD as gold soars.
Jobless claims data in focus next week.
Gold prices finally breached the $2050 level after threatening since mid-December after US PCE deflator readings missed forecasts. The core metric (Fed’s preferred inflation gauge) dropped to levels last seen in April 2021 and the first negative MoM print in over 3 years. Implied Fed funds futures below now prices in almost 160bps of cumulative rate cuts in 2024 with the first cut becoming more convincing in Q1. That being said, Durable goods orders and Michigan consumer sentiment have improved significantly and shows the resilience of the US economy in the current restrictive monetary policy environment. Jobless claims data continues to resist doves and will be closely monitored next week.
The daily XAU/USD chart above sees bulls looking to retest the overbought zone on the Relative Strength Index (RSI). As mentioned above, with minimal volatility expected over the coming week, prices may remain around current levels.
Resistance levels:
2150.00
2081.82
Support levels:
2048.79
2000.00
Jobless claims data in focus next week.
Gold prices finally breached the $2050 level after threatening since mid-December after US PCE deflator readings missed forecasts. The core metric (Fed’s preferred inflation gauge) dropped to levels last seen in April 2021 and the first negative MoM print in over 3 years. Implied Fed funds futures below now prices in almost 160bps of cumulative rate cuts in 2024 with the first cut becoming more convincing in Q1. That being said, Durable goods orders and Michigan consumer sentiment have improved significantly and shows the resilience of the US economy in the current restrictive monetary policy environment. Jobless claims data continues to resist doves and will be closely monitored next week.
The daily XAU/USD chart above sees bulls looking to retest the overbought zone on the Relative Strength Index (RSI). As mentioned above, with minimal volatility expected over the coming week, prices may remain around current levels.
Resistance levels:
2150.00
2081.82
Support levels:
2048.79
2000.00
Comment:
bullish
Wallstreet starts Profit taking now because of End of year closing tomorrow
Good news for Nasdaq today: FED much more under presure now:Joble claims again higher than expected to 217K.Fed expecting that the market celebrates the news, but as the market is smarter than.... is instead taking profits now...This is really good as the probability of NQ open above Dec 2023 close is increasing now....Wallstreet preparing that way to continue the ralley in 2024...The probability to cut FED Funds rate in January jumped from 0.2% to +17% in January 2024 baed on bloombergy news aganecy and FED dot rates. Cheers traders.Have a good start and winning year 2024
Wallstreet starts Profit taking now because of End of year closing tomorrow
Good news for Nasdaq today: FED much more under presure now:Joble claims again higher than expected to 217K.Fed expecting that the market celebrates the news, but as the market is smarter than.... is instead taking profits now...This is really good as the probability of NQ open above Dec 2023 close is increasing now....Wallstreet preparing that way to continue the ralley in 2024...The probability to cut FED Funds rate in January jumped from 0.2% to +17% in January 2024 baed on bloombergy news aganecy and FED dot rates. Cheers traders.Have a good start and winning year 2024
Comment:
US Pending Home Sales Index Holds at Lowest Level on Record
A gauge of pending US existing-home purchases held at a record low in November, indicating a weak resale market beset by a lack of inventory and high prices.
US jobless claims rose for second straight week after ticking up before Christmas
US: 7Y high yield 3.859%, WI 3.837%, 2.2bps tail; biggest tail since Nov 2022
GOOD FOR NASDAQ AND CO,bad for inflation and U Dollar
A gauge of pending US existing-home purchases held at a record low in November, indicating a weak resale market beset by a lack of inventory and high prices.
US jobless claims rose for second straight week after ticking up before Christmas
US: 7Y high yield 3.859%, WI 3.837%, 2.2bps tail; biggest tail since Nov 2022
GOOD FOR NASDAQ AND CO,bad for inflation and U Dollar
Comment:
Gold: Deterioration in the US 10-year Treasury yield may support a bullish tone
An increase in dovish expectations on a rapid pace of Fed funds rate cuts projected for 2024 indicates a potential impending recession.
An uptick in recession risk may see a further deterioration in the US 10-year Treasury real yield which reduces the opportunity costs for holding Spot Gold (XAU/USD).
Spot Gold (XAU/USD) has managed to trade back above its 20-day moving average.
The price actions of Spot Gold (XAU/USD) have shaped the extended corrective decline to print an intraday low of US$1,973 on 13 December during the European session ahead of the FOMC meeting announcement on the same day which was just a whisker away from the US$1,955 support highlighted in our previous analysis.
All in all, it has shed -8.2% from its current all-time high of US$2,149 printed on 4 December 2023 which represents a retracement of close to 50% of its ongoing medium-term uptrend phase in place since the 6 October 2023 low of US$1,810.
The US Federal Reserve unleashed its dovish pivot last Wednesday, 13 December where its latest “dot plot” projection for the trajectory of the Fed funds rate has indicated a total of three rate cuts (75 basis points) pencilled in for 2024, upped from two projected rate cuts in the prior September’s dot plot which in turn led to an increased in dovish expectations of market participants to price in six rate cuts, a total of 150 bps in 2024 via the 30-day Fed funds rate futures calculated by the CME FedWatch tool.
This kind of dovish expectation that has skewed towards a rapid pace of the Fed funds rate cuts projection in the upcoming monetary easing cycle seems to indicate an impending recessionary scenario in 2024 that may put further downside pressure on the US 10-year Treasury real yield.
The price movement of the US 10-year Treasury real yield has broken down below a major support zone of 1.82%/1.73% (also the 200-day moving average) which room for further downside potential with the next intermediate support coming in at 1.38%.
Based on intermarket analysis, a further deterioration in the US 10-year Treasury real yield may support another round of potential impulsive upmove sequence in gold prices due to lower opportunity costs as gold does not produce “fixed coupons income streams” like bonds.
The minor slide of -1.5% seen Spot Gold (XAU/USD) from Thursday, 14 December ex-post FOMC high of US$2,048 has been accompanied by a hawkish remark made by Fed official Williams last Friday, 15 December that indicated a lack of preference for FOMC to discuss its first rate cut in March 2024 which was in contrast with a high chance of 75% of a 25 bps rate cut in March 2024 FOMC as priced in by the 30-day Fed funds futures calculated by the CME FedWatch tool as of 15 December 2023.
Interestingly, the slide has managed to stall right at the upward-sloping 20-day moving average, acting as near-term support at US$2,017, slightly above the US$1,997 short-term pivotal support with a bullish momentum reading seen in the hourly RSI momentum indicator at its oversold region.
A clearance above US$2,043 may see the next intermediate resistances coming at US$2,067/US$2,075 and US$2,117 in the first step.
However, failure to hold at US$1,997 invalidates the recovery scenario to revive the corrective decline towards the medium-term support zone at US$1,965/US$1,955 (also the 200-day moving average).
An increase in dovish expectations on a rapid pace of Fed funds rate cuts projected for 2024 indicates a potential impending recession.
An uptick in recession risk may see a further deterioration in the US 10-year Treasury real yield which reduces the opportunity costs for holding Spot Gold (XAU/USD).
Spot Gold (XAU/USD) has managed to trade back above its 20-day moving average.
The price actions of Spot Gold (XAU/USD) have shaped the extended corrective decline to print an intraday low of US$1,973 on 13 December during the European session ahead of the FOMC meeting announcement on the same day which was just a whisker away from the US$1,955 support highlighted in our previous analysis.
All in all, it has shed -8.2% from its current all-time high of US$2,149 printed on 4 December 2023 which represents a retracement of close to 50% of its ongoing medium-term uptrend phase in place since the 6 October 2023 low of US$1,810.
The US Federal Reserve unleashed its dovish pivot last Wednesday, 13 December where its latest “dot plot” projection for the trajectory of the Fed funds rate has indicated a total of three rate cuts (75 basis points) pencilled in for 2024, upped from two projected rate cuts in the prior September’s dot plot which in turn led to an increased in dovish expectations of market participants to price in six rate cuts, a total of 150 bps in 2024 via the 30-day Fed funds rate futures calculated by the CME FedWatch tool.
This kind of dovish expectation that has skewed towards a rapid pace of the Fed funds rate cuts projection in the upcoming monetary easing cycle seems to indicate an impending recessionary scenario in 2024 that may put further downside pressure on the US 10-year Treasury real yield.
The price movement of the US 10-year Treasury real yield has broken down below a major support zone of 1.82%/1.73% (also the 200-day moving average) which room for further downside potential with the next intermediate support coming in at 1.38%.
Based on intermarket analysis, a further deterioration in the US 10-year Treasury real yield may support another round of potential impulsive upmove sequence in gold prices due to lower opportunity costs as gold does not produce “fixed coupons income streams” like bonds.
The minor slide of -1.5% seen Spot Gold (XAU/USD) from Thursday, 14 December ex-post FOMC high of US$2,048 has been accompanied by a hawkish remark made by Fed official Williams last Friday, 15 December that indicated a lack of preference for FOMC to discuss its first rate cut in March 2024 which was in contrast with a high chance of 75% of a 25 bps rate cut in March 2024 FOMC as priced in by the 30-day Fed funds futures calculated by the CME FedWatch tool as of 15 December 2023.
Interestingly, the slide has managed to stall right at the upward-sloping 20-day moving average, acting as near-term support at US$2,017, slightly above the US$1,997 short-term pivotal support with a bullish momentum reading seen in the hourly RSI momentum indicator at its oversold region.
A clearance above US$2,043 may see the next intermediate resistances coming at US$2,067/US$2,075 and US$2,117 in the first step.
However, failure to hold at US$1,997 invalidates the recovery scenario to revive the corrective decline towards the medium-term support zone at US$1,965/US$1,955 (also the 200-day moving average).
Comment:
Trend UP SELL more USD
Dollar tentative as investors await Fed Dollar tentative as investors await Fed minutes
Gold firms on Fed rate-cut hopes; US data in focus
Gold prices rose on Tuesday, supported by the prospect of interest rate cuts in 2024 from the Federal Reserve, while investors look forward to a slew of economic data this week for more clarity on the U.S. rate outlook.
Markets are now pricing in an 86% chance of rate cuts from the Fed in March, according to CME FedWatch tool. Lower interest rates decrease the opportunity cost of holding non-yielding gold.
Also on the radar, data on U.S. job openings and December non-farm payrolls will also been keenly watched for more clarity on Fed rate path.
Dollar tentative as investors await Fed Dollar tentative as investors await Fed minutes
Gold firms on Fed rate-cut hopes; US data in focus
Gold prices rose on Tuesday, supported by the prospect of interest rate cuts in 2024 from the Federal Reserve, while investors look forward to a slew of economic data this week for more clarity on the U.S. rate outlook.
Markets are now pricing in an 86% chance of rate cuts from the Fed in March, according to CME FedWatch tool. Lower interest rates decrease the opportunity cost of holding non-yielding gold.
Also on the radar, data on U.S. job openings and December non-farm payrolls will also been keenly watched for more clarity on Fed rate path.
Comment:
Daily Global Market Update
The Euro-Dollar pair experienced a slight decline in the last session, dropping by 0.2%. The Stochastic RSI indicates that we are currently in an oversold market condition.
Dollar-Yen Pair's Gains
The Dollar-Yen pair saw an increase of 0.7% in the last session. The RSI is currently giving a positive signal, suggesting potential continued upward movement.
Gold's Decline
Gold fell by 0.8% against the dollar in the last trading session. The CCI is currently giving a negative signal, hinting at a potential continued downtrend.
Global Financial Headlines
The US dollar has risen, bolstered by high US Treasury yields and a cautious market sentiment affecting Wall Street. Traders are now awaiting further economic data. Job openings in the US saw a decrease to their lowest level since March 2021, indicating a cooling job market. European markets have also experienced a sharp decline, with various sectors showing mixed performances.
Upcoming Economic Highlights
Key economic events to watch out for include the US ADP Employment Change, Initial Jobless Claims, Germany's Harmonized Index of Consumer Prices, and Japan's Jibun Bank Manufacturing PMI, among others. These data points are crucial for investors and traders to watch as they provide insights into the economic health of these countries.
US ADP Employment Change - 1315 GMT
US Initial Jobless Claims - 1330 GMT
Germany's Harmonized Index of Consumer Prices - 1300 hours GMT
Spain's 30y Bond Auction - 0940 GMT
Japan's Jibun Bank Manufacturing PMI - 0030 GMT
Japan's Monetary Base - 2350 GMT
The Euro-Dollar pair experienced a slight decline in the last session, dropping by 0.2%. The Stochastic RSI indicates that we are currently in an oversold market condition.
Dollar-Yen Pair's Gains
The Dollar-Yen pair saw an increase of 0.7% in the last session. The RSI is currently giving a positive signal, suggesting potential continued upward movement.
Gold's Decline
Gold fell by 0.8% against the dollar in the last trading session. The CCI is currently giving a negative signal, hinting at a potential continued downtrend.
Global Financial Headlines
The US dollar has risen, bolstered by high US Treasury yields and a cautious market sentiment affecting Wall Street. Traders are now awaiting further economic data. Job openings in the US saw a decrease to their lowest level since March 2021, indicating a cooling job market. European markets have also experienced a sharp decline, with various sectors showing mixed performances.
Upcoming Economic Highlights
Key economic events to watch out for include the US ADP Employment Change, Initial Jobless Claims, Germany's Harmonized Index of Consumer Prices, and Japan's Jibun Bank Manufacturing PMI, among others. These data points are crucial for investors and traders to watch as they provide insights into the economic health of these countries.
US ADP Employment Change - 1315 GMT
US Initial Jobless Claims - 1330 GMT
Germany's Harmonized Index of Consumer Prices - 1300 hours GMT
Spain's 30y Bond Auction - 0940 GMT
Japan's Jibun Bank Manufacturing PMI - 0030 GMT
Japan's Monetary Base - 2350 GMT
For a bullish continuation, XAU/USD buyers must reclaim the 50% Fibonacci level at $2028. Break above will expose the 38.2% Fib retracement at $2040.60 before clearing the path toward the ATH. Conversely, a fall below $2000 would expose a one-month-old support trendline that passes around the $1970-80 area.