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HFM



Date: 10th September 2024.

Market Update – Markets prepare for US CPI & Harris-Trump high-stake debate.

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Asia & European Sessions:

*Wall Street recovered slightly from Friday’s dip. Dip buying got the ball rolling and short covering has added to the bullish momentum.
*Expectations for a soft, rather than hard landing, with the FOMC expected to cut rates by only -25 bps rather than -50 bps have supported as well. The advent of the Treasury’s $119 bln in auctions, along with a heavy corporate calendar also weighed.
*Nvidia and Tesla have paced the strength in big tech. The Dow advanced 1.2%, with the S&P500 and NASDAQ climbing 1.16%. Strength was broadbased. Five of the 11 S&P 500 sectors posted gains of better than 1%, led by consumer discretionary and IT.
*Sights are on today’s presidential debate and then CPI Wednesday. 
*European stock markets are narrowly mixed in early trade, with the FTSE 100 underperforming, after a drop in the ILO unemployment rate. The overall labor market report was not as clear-cut, but the data will add to the arguments against back to back cuts and another move from the BoE this month.
*German HICP inflation was confirmed at 2.0% y/y. The data will add to the arguments in favor of a cautious cut from the ECB on Thursday.

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Financial Markets Performance:

*The USDindex found its footing and rose to 101.68 from an overnight low of 101.14.
*The USDJPY lifted to 143.21. The Yen corrected, which helped to limit the slide in the Nikkei.
*Oil returned to $67.60 after Monday’s gain, driven by the return of a risk-on tone to wider markets.
*Gold edged up 0.36% to $2506.38 ahead of US Inflation tomorrow.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.


Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 9th September 2024.

Market Update – How Aggressively Might the Fed Cut Interest Rates?

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The August jobs data did not provide the clarity on the rate outlook that had been hoped and left the markets to their own devices. Concurrently, comments from Fed Governor Waller left the door open for an aggressive -50 bps cut after he said he favored front-loading policy action, but stressed only if appropriate.

Asia & European Sessions:

*European & US equity markets open in the green, following a recent selloff due to weaker-than-expected US jobs data. Wall Street plunged on Friday, as the NASDAQ collapsed -2.55%, with the S&P 500 and Dow down -1.73% and 1.01%, respectively.
*Asian markets followed the global downturn, with stocks in Taiwan, Australia, and Japan experiencing declines. Nikkei dropped for a 5th consecutive day.
*Asia’s benchmark index fell to a 3-week low. Chinese stocks are on the brink of falling to the 5-year low seen in February due to weak earnings and economic recovery. The CSI 300 Index has fallen over 13% since its peak in May, reflecting ineffective policy efforts to revive the economy. Market pessimism in China is fueled by deflationary pressures, weak consumer demand, and a prolonged property slump.
*Economic experts suggest that unless there is a significant policy shift, bearish sentiment may persist.
*Japan: Q2 GDP was revised down to a 0.7% pace, bouncing from the -0.6% contraction in Q1. It ties Q2 2023 for the fastest pace of growth since the 1.3% rate in Q1 2023. The deflator was revised up to a 3.2% y/y rate from 3.0% y/y.
*BOJ: The data leave the door open for another BOJ hike down the road, though we suspect policymakers will be sidelined at the upcoming meeting on September 20 to further assess conditions.
*China CPI edged up to a 0.6% y/y rate in August. It is a seventh month in positive territory after four straight months of deflation (from October through January). Nevertheless, price weakness continues to reflect the slack in demand and the very sluggish growth pace in the economy. And even more serious, PPI plunged to -1.8% y/y in August from -0.8% y/y, the biggest drop since April. And producer prices have been in deflation since September 2022.

While a September Fed rate cut is expected, uncertainty remains about the scale and frequency of future cuts.

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Financial Markets Performance:

*The USDindex slumped to 100.58 before bouncing to a 101.187 close.
*The USDJPY lifted to 143.21. The Yen corrected, which helped to limit the slide in the Nikkei.
*The EURUSD and Cable are lower, at currently 1.1059 and 1.31 respectively.
*Oil drifted to $66.67 before recovering slightly to $68.20. Oil marked its lowest close since 2021 after a deep weekly loss pushed futures near levels regarded as oversold, with the focus on weather risks (Storm in Mexico) and reports this week that may clarify the demand outlook.
*Gold tumbling between $2485-2500.
*Iron ore prices fell below $90 per ton for the first time since 2022.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.


Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 5th September 2024.

US Jobs Vacancies Fall to 3-Year Low Pressuring The US Dollar!

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*US Job Vacancies drop to their lowest level in more than 3 years. The US Dollar Index declines. 
*The best performing currency of the week is the Japanese Yen. Investors are turning to the only Central Bank which is not going to cut rates in 2024.
*The possibility of a 50-basis point rate cut increases, but economists stick to their 0.25% predictions for now. 
*Oil prices fall close to lowest levels of 2024. Shareholders expect lower oil prices to prompt a lower inflation rate over the next 2 months.

USDJPY – JOLTS Job Data Points To Potential Larger Rate Cuts!

The price of the US Dollar came under pressure from the latest US job vacancies figures which fell below expectations. US Job Vacancies dropped to their lowest level in more than 3 years. The US Dollar Index as a result fell 0.42% and continues to be the worst performing currency of the day this morning. The Japanese Yen is currently increasing 0.43% higher and is the day’s best performing currency. This ensures no conflict between the two currencies so far, but investors will need to ensure this trend continues while they trade. 

The July JOLTS job openings data was released today, revealing a decrease from 8.18 million to 7.67 million, signaling continued weakening in the labor market and raising the chances of a significant rate cut. Additionally, the Fed’s Beige Book economic review will be published later in the day, providing insight into the current economic conditions across different regions of the US.

According to experts, the possibility of the Bank of Japan again increasing interest rates is growing but the timing is not yet certain. However, even without an interest rate hike, the Japanese Yen is likely to witness support as global banks cut rates. This includes the Federal Reserve, Bank of England and European Central Bank. During this morning’s Asian session, the Japanese Yen has risen in value against all currencies. Though, investors will monitor that this does not change as the European trading session starts.

USDJPY – Technical Analysis Update

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Upcoming Events

The price action throughout the remainder of the week will depend largely on the US Dollar. Today’s ISM Services PMI, ADP Employment Change and tomorrow’s official employment data will significantly influence the US Dollar and the USDJPY. Thereafter the market will turn their attention towards comments from members of the FOMC and the US inflation data.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 4th September 2024.

Stocks Suffer Sharpest Drop Since August 5th, What’s Next?

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*The stock market witnesses its worst session since August 5th. The NASDAQ drops more than 3.00% as 80% of its stocks decline. 
*The VIX rises more than 5% indicating a low risk appetite as investors fear lower consumer demand and the unwinding of certain hedge positions. 
*The price of the Japanese Yen increases in value for a second consecutive day. 
*ISM PMI data improves but investors turn their attention to JOLTS Job Openings and NFP.

NASDAQ (USA100) – 80% of Stocks Decline But Will Investors Buy The Dip?

The NASDAQ is trading at its lowest price since August 13th after witnessing its worst trading day since August 5th. Throughout all 3 trading sessions the price of the index fell 3.40% and is now trading firmly below trend lines and neutral levels on Oscillators. The question now is whether the price is oversold and if investors are unwilling to trade at such high prices.

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The decline was not solely related to the NASDAQ, but the whole US stock market as well as global stocks. The NIKKEI225 fell a further 1.50% today and the DAX is due to open 0.60% lower. Simultaneously the VIX is trading higher for a third consecutive day. These are known to be indications of lower sentiment towards stocks. 

The decline came about due to the lower risk appetite, the unwinding of hedge positions which involved the Japanese Yen and fear of lower consumer demand. The index was also influenced by the higher PMI data from the ISM which indicated higher economic sentiment. As a result, a 50-basis point rate cut becomes less likely applying further pressure on the stock market. However, this will also depend on this week’s employment data and next week’s inflation rate. 

All of the 12 most influential stocks fell in value and of the top 50 influential only 7 ended the day at a higher price. The question now is whether investors will now look to purchase the lower price. This will largely depend on today’s JOLTs Job Openings which analysts expect to read slightly above 8 million. Ideally investors will want to see higher job openings in order to give them confidence the consumer demand will not fall. According to economists, even with a slightly higher figure, the Federal Reserve is still likely to cut interest rates. 

Since the opening of the European Cash Open, the VIX has slightly fallen and European stocks are attempting a rebound. This is also something traders will monitor because if the momentum continues it may indicate a different price movement, such as a correction. Nonetheless, this will still largely depend on today’s release.

USD/JPY – Technical Analysis

The Japanese Yen is the day’s best performing currency while the US Dollar is the worst performing currency. The USDJPY is also trading below the trend-line, 100-Period SMA and below the 50.00 level on the RSI. The exchange rate has also fallen below 144.904 which is a key level on the Fibonacci levels. 

The Institute for Supply Management reported that in August, the US Manufacturing PMI increased slightly from 46.8 to 47.2 points, but still signals a slowdown in the industry. This slowdown meets the Federal Reserve’s conditions for easing monetary policy. Many experts now expect the Fed to lower interest rates three times, by a total of 100 basis points, by the end of the year. If the day’s JOLTS Job Openings read lower than 8 million, the US Dollar can witness higher downward momentum.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 3rd September 2024.

Gold Analysis: Will Gold Break Free from Its Current Price Range?

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*Gold trades 16.00% higher in 2024 as economists predict the Federal Reserve will cut between 75 and 100-basis points.
*The price of Gold is at a clear trend line and rebounds at the opening of the European Trading Session. 
*Economists advise that for Gold to continue to increase to $2,600 and above, the market would require the Federal Reserve to cut 1.00%.

Gold (XAUUSD) – Will Gold Rise To $2,600?

Gold has risen 16.00% so far in 2024, largely driven by the geopolitical tensions and fear of lower consumer demand, but primarily due to expectations of lower interest rates. Analysts expect the Federal Reserve to adjust the Federal Fund Rate by 0.75%. However, volatility will increase if the Fed opts to adjust at a faster or slower rate. 

According to economists, in order for Gold to increase up to $2,600-$2,700, the Federal Reserve will need to increase the size of the rate cuts. According to the CME Group, there is a 45% chance, the Fed will cut 1.00% by 2025. If this possibility increases throughout the week, the price of Gold is likely to decrease as the Dollar declines. In order for the Federal Reserve to become more dovish, the regulator would look for weaker employment data and lower inflation. 

Throughout the day, the price of Gold will depend on the price movement of the Dollar as well as the ISM PMI release at 14:00 GMT. However, another key release will be tomorrow’s JOLTS Job Openings. Analysts expect the job vacancies are likely to fall from 8.18 million to 8.09 million, one of the lowest in the past 2-years. If both the PMI data and job vacancies read lower, Gold will potentially increase in value. This is due to markets expecting a higher rate cut and weakening demand. Therefore, Gold will gain higher demand as an alternative to the Dollar and its safe haven status.

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XAU/USD 10-Minute Chart on September 3rd

On the 4-hour chart, investors can clearly see the price is forming a range between the $2,529 and $2,492 level. The asset has largely found support and resistance at these levels as the market believes the asset is trading at its intrinsic value. However, the upcoming employment and inflation data can potentially change the market pricing. As the price continues to attempt to break through the resistance level at $2,529, the resistance level is losing its psychological edge over buyers. This makes it easier to break through.

On the 2-hour timeframe, the price is trading below the 75-Period EMA and 100-Period SMA. If the price rises above these levels, buy signals become more attractive. On the 10-Minute chart the asset has formed a bullish crossover and a higher high indicating bullish price movement. However, the price is overbought on the RSI. If the PMI data reads lower than expectations, the data will move hand in hand with the crossover signal.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 2nd September 2024.

Is The Dow Jones Overpriced? The DJIA Declines On Monday!

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*Markets expect US employment data to improve adding a further 160,000 employees to the country’s payroll. 
*Analysts expect US Job vacancies to drop to their lowest level in 2024, but to remain at the 5-Year Average.
*According to the Chicago exchange, an interest rate cut on September 18th is certain. Markets expect a 0.25% rate cut. 
*Strong gains on Friday evening saved the US Stock Market from witnessing another bearish close. 

Dow Jones (USA30) – Recurring Pattern

On Friday, the stock market quickly fell at the opening of the US Session but thereafter the market quickly rose to close at a higher price. Investors should note that of the past 7 trading sessions, this has been a known pattern. Of the past 7 trading sessions the price has fallen at the open and then corrected on 5 occasions. A positive factor for the Dow Jones is the price is forming higher swing lows and is witnessing less bearish momentum over the past week.

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Dow Jones Components

The Dow Jones’ components on Friday saw 5 stocks fall while 25 stocks rose in value. Therefore, 83% of the index rose in value confirming buy signals could have been relevant. Though, during today’s session investors should note that the US 10-Year T-Bond rose in value by 42 points. Currently, the VIX index is more or less unchanged, but as the US 10-Year T-Bond trades significantly higher, investors will need to be cautious of volatility. If the VIX increases in value and Bonds Yields remain significantly higher, the price of the Dow Jones may witness a horizontal trend.  It will also be vital to again review the percentage of the components witnessing bullish and bearish price movements. 

Earnings season is almost at a close, the only major company yet to release its earnings report is Broadcom. However, Broadcom stocks are not a component of the Dow Jones and the report will simply impact the market only through the broader market sentiment. Analysts will concentrate their attention on this week’s ISM PMI release, JOLTS Job Openings and the Employment data on Friday.

Ideally investors will want to see neither weak data which will trigger low consumer demand fears, nor positive data which will make rate cuts less likely. Ideally, investors would like to see the data read in line with expectations. Currently the market is pricing in 0.75% to 1.25% rate cuts in 2024. If the Fed indicates less than 0.75%, the stock market is likely to be overpriced. 

Dow Jones Technical Analysis

In terms of technical analysis, the Dow Jones has been the only index which has continuously held above the 75 and 100 Period Moving Averages. Meanwhile, the SNP500 and NASDAQ have been unable to maintain momentum. Higher demand is due to the Market’s lower risk appetite and investors increasing exposure away from the technology market. However, the price is now trading very close to its all-time highs and close to its overbought market on most oscillators. Therefore, investors will be looking for further price drivers to regain momentum.

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Dow Jones 10-Minute Chart on September 2nd

According to Fibonacci retracement levels, if the price declines, a retracement could fall as far as $41,339.55. If global indices rise and at least 65-70% of the Dow Jones’ stocks rise, investors may deem a breakout of the $41,641.00 level as a signal to speculate a price increase.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 30th August 2024.

Market Volatility, Stock Market and Upcoming US Elections.

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US Elections have been and are always expected to be extremely volatile events worldwide. Elections, similar to other political or banking sector events, are notably treated by market participants with anticipation and speculation.

As soon as Kamala Harris entered the Presidential race, replacing Joe Biden on the ticket, the stock markets began showing a noticeable preference for her. Market Watch reports that based on current stock market trends, Harris has a 64% chance of winning the election, a significant shift from the previously erratic market behavior.

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This shift in the stock market is a positive indicator, suggesting that investors are placing their confidence in the Democrats and their potential economic policies. While the impact on the election outcome might be minimal, the fact that a significant portion of these investors are also voters means that careful analysis of market trends could provide insights into the current political climate as the 2024 US Presidential Election approaches.

Historically, it has been noticed that during election years, market participants shift their investments into money market funds instead of the safety of stock and bond funds, as they wait out the heightened uncertainty.

But will 2024 be the same? We cannot quite know yet but it’s been a unique one so far as we have seen an extreme money flow into equity market and commodity market in comparison with past election years, due to geopolitical risk, US political uncertainties which added to the instability, AI mania which boosted global stock markets, and the recession concerns which initially returned but currently are considered to have been overblown, as were aggressive Fed rate cut bets.

Are stock market investors rallying behind Kamala Harris? If we consider Market Watch’s analysis, Harris is indeed receiving substantial support from stock market investors across the US. This is reflected in the increased investments and the positive performance of certain stocks following her entry into the race after Biden’s unexpected withdrawal.

Can the stock market serve as a reliable political barometer? The stock markets can offer insights into voter sentiment and have historically been a strong political predictor.

In periods of uncertainty, the equity markets’ volatility and volume tend to spike again since they are considered to be attractive and more stable assets. If we focus on the medium term though it is expected that if current conditions sustain, market volatility will extend beyond Election days with any potential outcome, i.e. a Harris win and Democrat majority in Congress, a Harris win but split Congress, or a Trump victory with split Congress.

Meanwhile, a chart from Wells Fargo Investment Institute, shows the USA500 implied Volatility index along with USA500 index performance prior and post the Election Day based on the elections since 1988 with the 2008 recession year excluded. This chart interestingly suggests that typically the USA500 tends to ease/consolidate a bit a month prior to the elections despite an extremely high volatility, while USA500 price continues its upwards move after the election day even though volatility declines significantly.

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However, it’s crucial to remember that market trends don’t always align with election outcomes. For instance, during the 2016 election, the stock market favored Hillary Clinton, but the final results told a different story.

Historically, the markets have shown a tendency to respond more favorably to Democratic candidates rather than Republicans, due to various factors. It remains to be seen if the stock market’s predictions for the 2024 US election will prove accurate.

Currently, market trends suggest a positive response towards Democratic candidate Kamala Harris, who is gradually gaining traction in the polls. However, as fear of a potential recession is still in the background, the US stock markets are in a state of uncertainty.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 29th August 2024.

Market News – Nvidia dropped after hours; Equities mixed; Dollar pared some losses.

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Asia & European Sessions:

* Nvidia dropped about -7% in after hours trading in Frankfurt this morning, mirroring a fall in US after-hours trading which took Wall Street futures down with it. Though Nvidia’s guidance fell short of lofty expectations, the company’s revenue more than doubled to $30 billion in the fiscal second quarter, ending July 28. Additionally, Nvidia’s board approved $50 billion in new stock buybacks.
* Beats from Salesforce and CrowdStrike help contain losses. Nvidia reported solid results but the bar was so high that the data failed to top the most bullish estimates..
* The NASDAQ led the decline, dropping -1.77% before paring losses into the close to finish -1.12% lower. The S&P500 tumbled -1.1% before closing with a -0.6% loss. The Dow trimmed its -0.99% decline to -0.39%
* In Japan, a 2-year government bond auction attracted the highest bid-cover ratio since 2019, spurred by recent yield increases.
* In China, the downbeat earnings trend persisted. Shares of electric vehicle maker Li Auto Inc. plummeted by up to 15% after missing forecasts, while BYD Co. also declined despite posting a 33% profit increase. Contributing to the negative sentiment, UBS Group AG lowered its growth forecasts for China for this year and next, citing a more severe property market downturn than expected.

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Financial Markets Performance:

* The USDindex has pared some of yesterday’s gains and is at 101.17.
* The New Zealand Dollar gained strength following a surge in the country’s business confidence to a decade-high.
* Oil prices steadied after a 2-day decline, with stock market losses balancing out a reduction in US inventories and supply disruptions in Libya.
* Gold traded just below its record high, poised for a monthly gain.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 28th August 2024.

Market News – European Stocks Higher After Another Range-Bound Session in Asia.

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Asia & European Sessions:

* European stocks were poised for modest gains as investors awaited Nvidia Corp.’s earnings report for insights into the growth trajectory of AI-related stocks. Euro Stoxx 50 futures increased by 0.1%, suggesting a muted opening for European shares, while US stock futures remained steady during Asian trading.
* Asian equities fluctuated within narrow ranges due to weak corporate earnings in China.
* Hong Kong dropped as much as 1.6%, while mainland stocks fell to their lowest levels since early February. Shares of Nongfu Spring Co., a bottled water manufacturer, plummeted by up to 13% as in China sectors like materials, tech, construction, automotive, and others face significant downside risks.
* Nvidia is expected to report Q2 adjusted earnings of 65 cents per share on $28.74 billion in revenue, more than double what it earned in the same quarter last year, according to FactSet. Nvidia’s revenue has tripled annually over the past three quarters, driven primarily by the data center business. Demand for generative AI products, which can generate documents, create images, and serve as personal assistants, has significantly boosted sales of Nvidia’s specialized chips over the past year. However, Wall Street is keen on signs of any slowdown in AI demand.

Financial Markets Performance:

* The Yen extended its losses against the US Dollar, to 144.595 following comments from Bank of Japan’s Deputy Governor Ryozo Himino. Himino stated that the BOJ would raise interest rates as long as inflation aligns with the bank’s outlook and emphasized the need for close monitoring of developments.
* Bitcoin fell below $60,000 as part of a broader cryptocurrency market decline, including a sharp drop in Ether, the second-largest cryptocurrency.
USOil rem* ained steady after a previous session’s decline, ending a 3-day rally. USOIL is under $75. The API projected that nationwide inventories fell by 3.4 million barrels last week, which would mark the 8th decline in nine weeks if confirmed by official data later today. Crude oil has experienced volatility in recent sessions, with recent declines following a rally near the 200-DMA. Political risks in the Middle East and potential supply disruptions from Libya have supported recent gains, but a broadly bearish outlook has led major Wall Street banks like Goldman Sachs and Morgan Stanley to lower their price forecasts for next year.
* Gold retreated after a 3-day climb that brought it closer to its all-time high.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 27th August 2024.

Market News – Stocks mixed; Big Tech pulled down; Oil unchanged amid supply concerns.

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Asia & European Sessions:

* US: Some steam came out of Friday’s rally as Treasuries and Wall Street corrected from overbought conditions. The bond market had already priced in at least a -25 bp rate cut on September 18, though yields dropped further following Chair Powell’s confirmation. With little on the docket until Thursday’s claims data, the market gave back some of its gains. There was also a little concession building ahead of the start of the $183 bln in auctions.
* The S&P500 rose to 5651 in early action, but failed to test the record high of 5667 from July 16. The NASDAQ slumped -0.85% on profit taking ahead of Nvidia earnings Wednesday. The Dow was up 0.16%.
* Several technology companies tip the market because of their big values. Nvidia lost 2.2%, Microsoft fell 0.8%, Amazon dropped 0.9%, Meta Platforms slid 1.3% and Tesla lost 3.2%.
* China: Industrial profit data for China was robust, but mainland China bourses still struggled, while the Hang Seng managed slight gains.
* Europe: The Stoxx Europe 600 climbed 0.3% at the open, DAX and FTSE 100 are currently up 0.1% and 0.4% respectively. The UK is catching up after the extended holiday weekend.
* German data confirmed that GDP contracted -0.1% q/q in the second quarter and GfK consumer confidence data unexpectedly declined, which coupled with deteriorating business confidence flags recession risks.

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Financial Markets Performance:

* The USDIndex index is at 100.85.
* EURUSD and Cable are consolidating but remain at high levels at currently 1.116 and 1.319 respectively. Both flagged that monetary policy will have to remain restrictive for the time being. That won’t prevent additional rate cuts, but highlights that central banks will move cautiously.
* USOil closed with a 2.9% pop to $77.04 after news Libya was shutting supply added to the bullish impact of increasing tensions in the Middle East.
* Gold firmed to $2509 per ounce on geopolitical risks and rate cut prospects.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 26th August 2024.

Market News – FED: “The time has come for policy to adjust”.

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This year’s Jackson Hole central banker symposium provided the opportunity for Fed Chair Powell to set the policy course for the FOMC, looking to join the other core central banks already in rate cutting mode. The markets got a big boost after he confirmed the FOMC will begin lowering rates on September 18.

The question on size could be answered by upcoming jobs numbers.

* Europe & UK: The ECB is also likely to reduce rates again next month, while the BoE’s Bailey sounded a more cautious tone.  Like the ECB, the BoE seems more likely to stick to meetings with updated projections and detailed analysis, which would mean the BoE will sit out the next meeting and move again in November.
* Japan: Governor Ueda signaled the BoJ remains on its normalization course, but a hike as soon as September 20 seems unlikely.

Asia & European Sessions:

* Asian stock markets have shown mixed performance so far today, with the Hang Seng rising more than 1%, while Japanese markets corrected as the Yen rallied.
* Japan’s Nikkei 225 index dropped by 1.1%, reaching 37,944.68. Hong Kong’s Hang Seng index gained 1.0% to 17,786.31. Shanghai Composite index slightly declined by 0.1% to 2,852.34. Australia’s S&P/ASX 200 rose 0.7% to 8,076.10.
* European stock markets are mostly lower, with the DAX currently posting a loss of -0.2%. UK markets are closed for a holiday.
* The Dow climbed 1.1% to 41,175.08, surpassing the 41,000 mark for the first time since July.

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Financial Markets Performance:

* The USDIndex saw a session low of 100.53 after plunging on Friday. It is currently trading at 100.41.
* EUR and Sterling have benefited from dovish Fed bets and the correction in the Dollar.  The EURUSD pulled back from 1.1200 and is currently at 1.1177. The GBPUSD broke key resistance at 1.31 and is  retesting 1.3200 currently.
* The Yen outperformed, and rallied against most currencies.t is currently settled at 143.43.
* USOil spiked to $75.28. Safe-haven buying due to increasing tensions in the Middle East, alongside bets on the Fed, contributed to market movements. Oil prices rose 0.7% as the region prepared for further conflict following an Israeli strike on Hezbollah targets in southern Lebanon.
* Gold recovered to $2524.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 23rd August 2024.

Market News – The Big Day!

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* Profit taking was seen ahead of Chair Powell’s comments today, weighing on Treasuries and Wall Street as some of the aggressive Fed rate cuts bets were trimmed further.
* US economic data showed mixed results, with growth relying more on the service sector as manufacturing slows. A better than expected S&P Global services print, a bounce in new home sales, and cautious comments from several Fed officials from Jackson Hole were the catalysts for the selloff. 
* The Yen rose after BOJ Governor Kazuo Ueda hinted at potential interest rate hikes, reaffirming the BOJ’s stance if economic data aligns with forecasts. This follows concerns after the BOJ’s July rate hike caused a global equity selloff. Japanese inflation data exceeded expectations, supporting the Yen as well.
* Focus on Powell’s Speech: Traders are awaiting Federal Reserve Chair Jerome Powell’s speech for clues on potential rate cuts. Some have been warning that the event risk is that Powell will be more cautious than markets are now expecting, which could weigh on the Euro and Sterling in particular.

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Asia & European Sessions:

* Wall Street tumbled, with losses accelerating into the close. The NASDAQ finished with a -1.67% plunge, while the S&P500 was -0.89% lower, and the Dow was down -0.43%.
* Asian equities were mixed, with Chinese shares helping to erase earlier losses. Global stocks were volatile, with declines in Hong Kong, South Korea, Australia, and the US.
* Alibaba’s Hong Kong listing upgrade was approved, which is expected to attract significant investment. However, Chinese tech stocks like NetEase, Baidu, and Bilibili fell due to weak earnings.

Financial Markets Performance:

* The USDIndex has extended its declines, falling to 100.93. The buck has not closed with a 100 handle since April 2022.
* EURUSD has inched down to 1.1130 after drifting to 1.1097, but is still near the highest level in a year. Sterling outperformed and Cable rallied to 1.3120 after strong PMI data. The USDJPY is trading at 145.27 (S1) after a broader correction in the Yen.
* USOil steadied between 72.58-72.94.
* Gold has inched down to $2470 per ounce and still holds below the $2500 level.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 22nd August 2024.

Market News – Eyes on Euro, Stock Markets in Green, But Cautioness Prevails Ahead of Fed & BoJ.

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FOMC minutes showed that the Fed was on the verge of cutting rates at the July 31 meeting, and the report sets up a reduction in rates with the September 18 decision. Expectations were further reinforced by the BLS’s downward revisions to Nonfarm payrolls.

* Treasury yields tumbled on the payroll revision and were down further after the FOMC minutes, but closed off their lows in a bull flattening trade.
* Wall Street bounced back marginally, looking to start another win streak after the modest declines Tuesday prevented a ninth straight gain in the S&P500, which would have been the longest since 2004.
* European stock markets are slightly higher in early trade, after a largely stronger close across Asia. The Nikkei closed 0.7% higher, the Hang Seng bounced 1.2%, after yesterday’s correction. Gains in Europe are more modest, with DAX and FTSE 100 up 0.1% and 0.2% respectively.
* The NASDAQ rose 0.57%, with the SP500 up 0.42%, while the Dow was 0.13% higher.
* The VIX jumped 2.86% to 16.87.
* Eurozone Composite PMI unexpectedly bounced back in the preliminary reading for August. The Manufacturing PMI still declined to an 8-month low and Services index outperformed. Confidence levels have dropped to the lowest so far this year and are below the “series average.” So the improvement in the headline doesn’t necessarily signal a rebound in overall activity, and the numbers are unlikely to prevent the doves at the ECB from pushing for another rate cut in September.

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Financial Markets Performance:

* The USDIndex has extended its declines, falling to 100.93. The buck has not closed with a 100 handle since April 2022.
* The Euro surged to a 1-year high against the US Dollar in August, driven by expectations of upcoming Fed rate cuts. The euro-dollar pair sees around $2.29 trillion in daily turnover, making it a key vehicle for betting against the US economy. Money managers have been buying euros daily for the past two weeks, anticipating a Fed interest-rate cutting cycle.
* However, the US rates staying higher than European rates could restore the Dollar’s appeal.
* USOil prices slipped -1.7% to $71.92 per barrel.
* Gold was fractionally lower at $2512.01 per ounce after rising to a new record high of $2513.99 on Tuesday.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 21st August 2024.

Market News – Sentiment stabilize; EU stocks higher after mixed Asian session.

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* Safe Havens were boosted by rate cut expectations for the FOMC, as well as the ECB and BoC, and after a dovish cut by the Riksbank. Adding to the strength in the rally are the weaker USD, debt concerns (especially for the US), portfolio hedging, haven demand, along with buying from the PBoC and other central banks.
* Geopolitical risks remain a significant factor too, though they were tempered slightly late yesterday after news Israel had agreed to a cease-fire proposal.
* US bond yields dropped to their lowest since August 5, driven by fears of a recession after weak jobs data earlier in the month.

Asian & European Open:

* European stock markets are slightly higher in early trade, after a mixed close across Asia.
* Chinese tech companies listed in Hong Kong were under pressure and the Hang Seng underperformed with a -0.8% loss.
* Sentiment seemed to stabilize at the start of the European session, and US futures are marginally higher as markets wait for Jackson Hole and signals from major central banks that rates will go down next month.

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Financial Markets Performance:

* The USDIndex fell to its lowest level this year against euro as traders prepared for key US payroll data revisions & Fed Powell’s upcoming speech. EURUSD rallied to 1.1132.
* The Sterling and the Yen showed mixed performance against the USD, with traders eyeing Japan’s parliament session and BOJ Governor Ueda’s upcoming testimony. GBPUSD spiked to 1.3050 and USDJPY bottomed to 144.92.
* SMBC economist Ryota Abe expects the US Dollar to weaken to 138 Yen by next year, with the Fed’s rate-cut pace being a critical factor.
* The Aussie hovered near a 1-month high, while the Kiwi touched its highest level since July before slightly retreating.
* USOil was steady close to its $72 floor.
* Gold continued to trade at about $2,500 close to its all-time high, fueled by expectations of impending Fed rate cuts.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 20th August 2024.

Market News – Its all about market sentiment.

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* Wall Street continued its run higher as the panicked trade from early in the month continues to recede while outlooks on the Fed remain dovish heading into Chair Powell’s Jackson Hole speech Friday.
* Asian stocks mostly rose on Tuesday, driven by positive momentum from Wall Street as it neared record highs.
* Chinese property developer Kaisa announced a restructuring agreement with creditors to avoid legal challenges over its 2021 default. The deal includes issuing $5 billion in new bonds and $4.8 billion in convertible bonds. (Kaisa, once the largest offshore borrower after Evergrande, faces a winding-up petition in Hong Kong, though the case has been repeatedly delayed.)
* The RBA indicated that it will likely maintain interest rates at their 12-year high for an “extended period” to ensure inflation returns to target by next year.
* In Europe, growing risks to economic growth have strengthened the argument for a policy shift at the ECB’s meeting next month. Markets are also watching the EU CPI release due later today.

Asian & European Open:

* Expectations for lower rates helped boost the NASDAQ by 1.39%. The S&P500 climbed to its 8th consecutive gain and its best run since November. It is just the 2nd close over 5600 as it sets its sights on the record 5667 from July 16. The Dow rose 0.58% to 40,896 as 41,198 is back in view.
* The Nikkei surged 2.1% to 38,156.41, recovering from a previous 1.8% drop.

Financial Markets Performance:

* The USDIndex sank to 101.60, the weakest since early January.
* The Yen fluctuated against the US dollar, trading at the 147.33, rebounding from the 145-146 area.
* USOil prices decline to largest drop in 2 weeks, i.e. $72.76, as the US said Israel accepted a cease-fire proposal in Gaza, potentially easing supply risks as concerns about the global demand outlook mount.
* Bitcoin climbed to $60,974 while Gold continued to trade at about $2,500 close to its all-time high, fueled by expectations of impending Fed rate cuts.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 19th August 2024.

Market News – Asian Stocks gain but US in red, Dollar plumMets; Yen the biggest gainer so far.

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September Fed rate cut all but a done deal, look ahead to Jackson Hole

* Dovish Fed bets have also boosted hopes of additional easing in Europe, and bonds are falling as markets look ahead to the Jackson Hole Symposium, which is expected to provide new guidance on the direction of US monetary policy.
* The anticipation of lower borrowing costs is boosting investor confidence.
* The US Dollar crashed to its lowest in 5 months. Cooler heads have prevailed as the panicked fears of recession dissipated. The FOMC is widely seen on track for -25 bp rate cuts over the remaining three policy meetings this year.
* Goldman Sachs reduced the likelihood of a US recession within the next year from 25% to 20%, citing the recent retail sales and jobless claims data. If the upcoming August jobs report, due on September 6, shows positive results, “we would likely lower our recession probability further to 15%,” Goldman economists led by Jan Hatzius noted in a report to clients on Saturday.

Asian & European Open:

* Asian stock markets traded largely higher overnight, however, European markets are narrowly mixed in early trade and US futures are in the red.
* The Hang Seng and tech stocks led the way overnight. The Nikkei underperformed and corrected -1.8%.
* The German 10-year rate is down -1.6 bp, the 10-year Gilt -2.3 bp and the US 10-year yield -1.3 bp.

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Financial Markets Performance:

* The USDIndex has remained under pressure and hit a session low of 102.00, before picking up slightly.
* The Yen strengthened by 1% against the US Dollar, reaching 145.17 today. The yen’s rise is driven by overall USD weakness, anticipation of BOJ Governor Ueda’s parliamentary appearance on August 23, and Fed Chairman Powell’s speech at Jackson Hole. Markets are looking for signals from Ueda on the future direction of the BOJ’s interest rate policy. Political uncertainty is also influencing expectations, following Prime Minister Fumio Kishida’s announcement that he will not seek re-election as president of the ruling Liberal Democratic Party in September. Some investors are still betting on potential BOJ interest-rate hikes and may be buying Yen ahead of speeches by the US and Japanese central bank leaders later this week.
* USOil prices have also continued to struggle as demand concerns dominate. The USOIL is currently below $75 per barrel as traders tracked US-led efforts to secure a cease-fire in the 10-month old Middle East conflict, while the Russia-Ukraine war is escalating.
* Gold  rallied to an all-time high over $2500 per ounce,on hopes the Fed is edging closer to cutting rates.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 16th August 2024.

Markets corrected again; Stocks skyrocketed.

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Markets corrected again amid the back and forth on the Fed outlook and uncertainties over soft and hard landings that have besieged the outlooks since the jobs report. Global stocks have largely recovered from last week’s downturn, which had traders worried that the Fed might not cut rates quickly enough to prevent a recession.

* Asian stocks surged as investors returned to riskier assets, driven by increasing optimism that the US economy will sidestep a recession.
* September’s Fed rate cut was knocked out by the better than expected retail sales & jobless claims data and inflation. They are now anticipating less than a 30-basis point cut next month, with a total reduction of 92 basis points projected for the remainder of 2024.
* The RBA’s governor indicated that the central bank is still some distance from easing monetary policy.
* RBNZ governor Adrian Orr raised the distinct prospect of cutting rates another 50 basis points by year-end. NZDUSD rose to 0.6020.

Asian & European Open:

* Japanese stocks climbed, benefiting from a weaker Yen, which enhances exporters’ profits. The Nikke is set to end the week on a high, surging 2.9% to 37,800.42.
* Treasuries extended their losses, and the Yen is on track for its steepest weekly decline since May.
* The VIX fell further, dropping -6.49% to 15.14. It is well below the intraday spike to 65 on August 5 and is the lowest since July 23, even before the jobs report.
* Wall Street surged 2.34%, with the S&P500 advancing 1.61%, while the Dow climbed 1.39%. The rebound in US stocks from the heavy selling suggests that trend-following quant funds may soon reenter the market, potentially providing further support to equities.
* Walmart’s solid earnings report added to signs that the consumer is by no means dead, corresponding with the better news on retail sales. Alibaba Group Holding Ltd. saw gains as optimism around tech stocks overshadowed concerns about its earnings. JD.com Inc. surged the most since March after exceeding net profit expectations in its earnings report released late Thursday.

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Financial Markets Performance:

* The USDIndex firmed to 103.024 after fading from the spike to 103.227. It was as low as 102.530.
* The Yen dropped 1.3% hovered around the 149 mark. This currency depreciation might even entice some hedge funds back into the carry trade that unraveled two weeks ago.
* GBP strengthened as GDP data confirmed robust growth through the second quarter of the year, which weighed on Gilts and saw yields moving higher.
* The AUD strengthened as job gains beat expectations.
* USOil climbed 1.3% to $77.99 per barrel on the improved growth outlook.
* Gold rallied 0.34% to $2456.24 after slumping to $2432 on the data.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 15th August 2024.

Earnings and Inflation Boost the Dow Jones, Eyes Turn to Walmart’s Report!

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* US inflation falls from 3.00% to 2.90% making a September rate cut certain.
* According to the CME Group, there is a 64% chance of the September rate cut being 25-basis points.
* Japanese GDP data confirms the economy grew 0.8% in the past quarter. The UK economy sees no growth in the latest month.
* Wednesday’s best performing index was the Dow Jones after Cisco Systems beat earnings and revenue expectations.

USA30 – The Dow Jones Is Wednesday’s Best Performing Index!

The Dow Jones is rarely the best performing index due to its exposure to more stable and less volatile stocks. The upward momentum is largely due to the earnings data from Cisco Systems and Caterpillar. Investors will now turn their attention to the last major quarterly earnings report for the week, Walmart.

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80% of the Dow Jones’ stocks rose in value on Wednesday due to the significant rise in investor sentiment. Confidence in the stock market improved after the US inflation rate fell from 3% to 2.9% and the core inflation rate remained unchanged at 3.2%. The lower than previously expected inflation saw the market’s confidence rise and particularly support the Dow Jones.

The Dow Jones also saw momentum rise after Cisco made public their latest quarterly earnings report. Earnings per Share was 2.49% higher than Wall Street’s predictions and the revenue rose by almost $1 billion from the 1st to 2nd quarter. As a result, the stock rose by 5.75% after market close. The best performing stocks on Wednesday were American Express and Goldman Sachs. Investors will now turn their attention to Walmart which will release their earnings report before the market opens.

For Walmart, analysts predict the earnings per share to rise from $0.60 to $0.65 and for revenue to rise from $159 billion to $167 billion. The company has beat earnings expectations over the past 12 months due to investors looking to shop on a budget due to recent high inflation. On Wednesday, Walmart stocks rose 0.78% and a further 0.52% after market close. The rise and bullish momentum indicate investors believe the company will continue to perform well on their earnings reports. Walmart holds a weight of 1.12% and Cisco Systems 0.74%.

Dow Jones – Interest Rates and Upcoming Economic News.

After the lower inflation data for consumers and producers there is a 64% chance of the September rate cut being 25-basis points. According to many analysts the Federal Reserve will cut 0.75% by the end of 2024. However, some experts believe the Fed will cut a full 1.00%. This is also something which can be seen on the CME Group which indicates a 44% chance of a 1.00% cut by December.

Investors will now turn their attention to the US Retail Sales, Core Retail Sales and Weekly Unemployment Claims. Ideally shareholders would like to see the data slightly stronger than expectations, but not strong enough to suggest no rate cuts are needed. The Empire State Manufacturing Index and Philly Fed Index will also trigger volatility but to a lesser extent. The only concern for shareholders is a potential rise in tensions within the Middle East!

Currently the VIX trades with no major changes. As do Bond Yields, but a decline throughout the day would benefit the stock market.

Dow Jones – Technical Analysis!

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Technical analysis indicates buyers are holding momentum. On the 2-Hour chart, price trades above the 75-Period EMA and the 100-Period EMA. The price also continues to trade above 70 on the RSI but is not indicating an overbought price.  On the 5-Minute chart, the price continues to form bullish crossovers and trade above the VWAP. The price movement throughout as we approach the US session will depend largely on the global stock market performance and Walmart’s earnings report.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 13th August 2024.

The Pound Rises, But Cracks Emerge in the UK Employment Sector.

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* The Pound increases in value, but UK employment data signals economic stagnation and weakening employment.
* The UK number of individuals claiming unemployment benefits rises 135,000, the highest in over 4 years.
* The Dow Jones trades sideways but this may change as Home Depot is due to release their earnings report.
* Investors turn their attention to the US Producer Inflation Rate which analysts expect to fall to 2.3%.

GBPUSD – UK Employment Data Paints a Dim Picture!

The Great British Pound is increasing in value against the US Dollar and also against all other currencies. However, the economic data coming out of the UK this morning paints a very different picture. Therefore, many investors question whether the Pound will indeed maintain bullish momentum.

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The number of individuals claiming unemployment benefits from 135,000 within a single month, the highest since the first COVID lockdown. The six-month average for the UK Claimant Count Change (number of unemployment benefits) is 22,233. Therefore, 135,000 added within a single month is a concern for investors and the Bank of England.

In addition to this, the UK Average Earnings Index fell from 5.7% to 4.5% which is lower than expectations. The fall is likely to apply less upward pressure on inflation and can eventually prompt the Bank of England to consider an earlier rate cut. However, the positive from the morning’s UK data is the unemployment rate. The UK unemployment rate fell from 4.4% to 4.2%, a 4-month low.

It is vital for investors to continue monitoring the GBP index, which is currently trading 0.23% higher. However, if data continues to disappoint throughout the week, the traditional react would lead to a weakening of the British Pound. If individual wish to speculate a depreciating GBP, investors also have the option to trade the GBPNZD which has been the best performing currency of the past week.

Regarding the GBPUSD exchange rate, the price will also largely be dependant on this afternoon’s Producer Price Index. As the US session edges closer, investors will turn their attention to the PPI, which analysts expect to fall to 2.3%. If the Producer Price Index reads higher than expectations, the US Dollar may increase in value while the market’s risk appetite declines. As a result, the Pound can quickly give up gains from the past 24 hours.

Currently, the price of the GBPUSD is trading above most moving averages, oscillators and the VWAP indicating potential upward price movement. However, as mentioned above, the price movement will be dependant on the upcoming economic releases. If the price trades above 1.28037 and 1.28092, the exchange rate may rise in value in the short term. However, ideally the US PPI will need to read lower than expectations as the breakout takes place.

USA30 – Investors On Edge Ahead Of Inflation And Home Depot’s Earnings Report!

The Dow Jones continues to honour the price pattern of the previous 2 trading sessions as per yesterday’s analysis. However, this is now likely to change as Home Depot will release their earnings report in the upcoming hours. Additionally, this afternoon’s Producer Price Index will be a key price driver. Shareholders will be hoping for a lower-than-expected PPI.

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Home Depot has beat their earnings expectations over the past 4 quarters, but investors will also be looking for guidance for the upcoming quarters. Investors expect Earnings Per Share to rise from $3.63 to $4.55 and for revenue to rise by $6 billion. If the company beat expectations the stock potentially can rise and support the Dow Jones. Over the past 12 months the stock has risen 4.80% and has a dividend yield of 2.60%.

During this morning’s Asian session, the VIX is trading more than 2.00% lower which is positive for the Dow Jones. Investors will continue to monitor the VIX and US Bond Yields. If both decline, the price movement is likely to improve. Throughout the Asian session the Dow Jones has risen 0.32% and is attempting to move back to the resistance level. However, positive data is required to breakout of this level and form a possible bullish trend.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 12th August 2024.

How Will the Pound Perform Ahead Of A Vital Week For The UK!

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* Economists expect the US inflation rate to remain at 3.0% or to drop to 2.9%. Also, economists expect Inflation excluding Food and Energy to drop to 3.2%.
* The Federal Reserve’s Mrs Bowman advises cuts are needed only if inflation continues to decline.
* According to the CME Group, investors are split over whether the Fed will cut 0.50% or 0.25%.
* The US inflation data tomorrow and on Wednesday will determine how the Fed will cut.
* The Dow Jones await key earnings reports from Home Depot (13th August), Cisco Systems (14th August) and Walmart (15th).

GBPJPY – Key UK Data To Determine The Pound’s Value!

The price of the GBPJPY is trading at the recent average price, but the Pound is gaining momentum ahead of vital economic data. The performance of the Great British Pound will depend largely on the upcoming 5 key economic releases. The Japanese Yen on the other hand has slightly lost momentum after the dovishness of the Bank of Japan in their latest press conference. The performance of the Yen will largely depend on the dovishness of the other central banks such as the Fed, Bank of England and European Central Bank.

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GBPJPY 2-Hour Chart Showing The Price Rise Above Moving Averages For The First Time Since July 11th.

Throughout the week the UK will release the following key economic releases:

* Claimant Count Change
* Average Earnings Index
* UK Inflation
* Gross Domestic Product
* Retail Sales

The price of the GBP will depend on how the UK economy and inflation has performed over the past month compared to expectations. According to economists, if the UK inflation rate and GDP read higher than expectations, the Pound is likely to strengthen. However, investors will also be looking closely at the UK employment data as the UK Unemployment Rate has risen to 4.4%. If the unemployment rate rises, the UK’s rate will be at its highest in 3-years and can prompt a more dovish central bank.

Currently, the Pound is the best performing currency of the day, except for the AUD and NZD. The AUD and NZD normally tend to lose momentum as the European session opens. However, the New Zealand Dollar is also gaining momentum ahead of the RBNZ’s Rate Decision. The GBP is trading 0.20% higher so far in the Asian session. Technical analyst and economists consider if investors are increasing exposure predicting positive economic data throughout the upcoming week.

In terms of technical analysis, the price of the exchange is trading above the 75-Period EMA and 100-Period SMA for the first time since July 11th. The RSI is also trading at 59.00 which indicates buyers may be gaining control. The Japanese Yen index is trading 0.42% lower so far, therefore signalling no conflict, but investors will keep monitoring this throughout the week. Particularly once the US start releasing their inflation data. Prices above 188.405 will see stronger buy signals whereas below 186.477 will see traders look for sell signals.

USA30 (Dow Jones) – Investors Eye US Inflation and This Week’s Quarterly Earnings Reports!

On Friday, the Dow Jones traded in a sideways price range after breaking the resistance level. According to economists, the assets sideways movement is due to shareholders wanting to see the upcoming earnings reports. Economists advise the Dow Jones is appropriately priced and investors will look at economic data and earnings first before determining the intrinsic value of the asset. As a result, US data and the upcoming quarterly earnings report will be key.

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The Dow Jones On A 2-Hour Chart.

Previously, bad news was good news for the stock market. However, most shareholders will be hoping for slightly positive economic data to improve the risk appetite of the market. It will be key for the US inflation rate to fall if the stock market is to hope for a full correction back up to 14,000. Many economists advise a full correction is unlikely if inflation does not fall.

The performance of the Dow Jones will depend on the quarterly earnings reports and US inflation. The Federal Reserve’s Mrs Bowman advises cuts are needed only if inflation continues to decline. Markets viewed the comments are cautious and less dovish compared to market expectations. However, if inflation does decline, market will start to price a 50-basis point cut for September.

The Dow Jones awaits key earnings reports from Home Depot (13th August), Cisco Systems (14th August) and Walmart (15th). Over the past 6 months Home Depot stocks have fallen 4.60% and Cisco Systems 9.00%. Walmart stocks have risen almost 20% in 6 months.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 9th August 2024.

The Dow Jones Rebounds After Reassuring Guidance From Key US Companies!

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* Stocks rebound after leading economists come out in force to confirm no recession is approaching.
* The NASDAQ rises 2.87% and the Dow Jones 1.77%. The SNP500 witnesses its best day since November 2022.
* A sense of relief after the Weekly Unemployment Claims was 8,000 lower than expectations.
* The British Pound gets ready for a week full of vital economic data. The GBP remains unchanged prior to the London open.

USA30 – Why The Dow Jones Rose 1.77% On Thursday?

The Dow Jones on Thursday saw a strong rebound which was a result of three elements. The first is that economists came out in force to confirm there is no sign in economic data indicating a recession. Speeches from the CEOs of Commerzbank, Goldman Sachs, and Disney said there was no data pointing to a crash. However, they did advise the market is likely to witness high volatility and strong correction in the upcoming months.

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Looking at economic data, the US economy remains strongly in the growth zone, but with a more balanced employment sector and weakening consumer demand. The second element supporting the stock market is the Weekly Unemployment Claims. Weekly Unemployment Claims was 8,000 lower than expectations (241,000). Lastly, technical analysts also advised the market was comfortable to buy the dip after the stock market was unable to maintain the downward momentum from Monday.

 When monitoring the individual components of the Dow Jones, all stocks ended the day higher. The strongest gains were from Intel which rose 7.90% and Amgen which won back previous losses. Caterpillar also continues to perform well after beating its earnings expectations by 8.00% also adding to the upward momentum. In addition to this, the VIX index trades 0.20% lower this morning, and if the decline increases, the VIX would support a continued correction in the stock market.

Dow Jones (USA30) – Technical Analysis and US Inflation

A key factor in the pricing of the stock market will be next week’s Consumer Price Index. The inflation rate will help determine how much the Federal Reserve will be willing to cut in September. JP Morgan in its latest report advised there is a 35% chance of a recession, and the Fed may cut interest rates by 1.00% in 2024. However, many economists believe the Fed will only cut by 50 basis points in September if inflation falls next week. Lower inflation can support the stock market and further fuel a correction.

The Dow Jones has been trading sideways throughout the Asian session with no clear lasting crossovers. In addition to this, the MACD remains numb and the price trades at the VWAP. Therefore, more volatility is needed to obtain a clear signal. If the price breaks above the 39,551.75 level, a buy signal may arise from the breakout via crossovers and Fibonacci.

GBPEUR – Investors Brace For Crucial UK Data In The Upcoming Week!

The British Pound has significantly fallen in value over the past 3 weeks but has been attempting a correction over the past 3 days. The price is at the average price, but the economic data next week will be crucial for the Pound. A full correction back to 0.83820 or further bullish price movement will depend on the data.

EURGBP – Impact Of High Interest Rates!

In the following week, the UK will release their Claimant Count Change, Average Earnings Index, UK inflation, Retail Sales and the UK’s Gross Domestic Product. These 5 critical economic releases will indicate if the UK economy is solid and expanding or remains under pressure.

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It is noteworthy that the UK Finance association has published data indicating the significant impact of high interest rates. Experts highlight that the number of creditors’ claims for repossessing mortgaged properties has reached its highest level in five years. During this period, 96,000 homeowners were in arrears of at least 2.5%.

Additionally, claims for mortgage non-payment rose by 34.0% year-on-year while repossessions of mortgaged properties increased by 31.0% compared to the same period last year. Therefore, it will be vital for the Pound to obtain supporting economic data in the upcoming week.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 8th August 2024.

The Dow Jones Drops 2% As JP Morgan Signal Possible Recession.

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* JP Morgan advises markets that the economy is at a higher risk of a recession in 2024.
* Representatives of the Federal Reserve advise they will not call for an urgent meeting to cut interest rates.
* Disney beat expectations but theme park visitors significantly fell. Economists advise this shows the drop in consumer demand and the risks of inflation over the past 3 years.
* The Japanese Yen climbs after downward pressure in the first half of the week.

USA30 – The Dow Jones Reaches a Significant Support Level!

The Dow Jones price quickly collapsed after the opening of the US trading session and continues to remain low on Thursday. The decline was largely triggered by the poor performance of Amgen (-5.00%) and Walt Disney (+4.46%). Both stocks came under pressure by the quarterly earnings report which confirmed some risks. On Wednesday, only 35% of the Dow Jones rose in value, while 65% fell.

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Dow Jones 2-Hour Chart Illustrating recent Support & Resistance Levels

Disney’s Earnings Per Share for the latest quarter were significantly higher than previous expectations. Earnings were 16% higher while revenue came in as expected. However, the poor performance of the company’s theme parks dampened sentiment and the overall stock market. According to economists, the drop in revenue from theme parks is a result of inflation and lower consumer demand which not only influences Disney’s stocks but the overall market.

In addition to this, throughout the month of August, poor data can be followed by an overreaction as the market’s risk appetite remains low and on the lookout. The next significant quarterly earnings report for the Dow Jones is Home Depot on Tuesday before the market opens.

Another factor which is adding to pressure is the latest comments from JP Morgan, one of the largest US banks of all time. According to JP Morgan, the US economy is now at a higher risk of a recession in 2024, and a recent selloff has wiped out three-quarters of the global carry trade, erasing this year’s gains.

USA30 – Technical Analysis!

In terms of technical analysis, the price of the Dow Jones continues to find support at the $38,577.09 level. However, the price is testing the level for the fourth time this week. The question is, will the index break below the price or find short-term support. Currently the price trades below the 75-Period EMA, 100-Period SMA and below the 50.00 level on the RSI. However, a positive factor is the VIX index trades lower as do bond yields.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 31st July 2024.

How Are Earnings Shaping the NASDAQ?

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* Microsoft stocks fell 2.70% as Cloud revenue read lower than previous expectations. Overall earnings and revenue beat expectations.
* AMD and Starbucks stocks rise after releasing their quarterly earnings reports.
* Earnings support the NASDAQ after the index falls to a new monthly low.
* Meta, Qualcomm and Lam Research are due to release their earnings reports after today’s market close.

USA100 – How Will Investors View The NASDAQ After The Recent Earnings Data!

Yesterday, the NASDAQ fell 1.81%, hitting a recent low and pushing the index 10.50% below its recent highs. However, the decline came to a halt as the earnings from influential companies prompted investors to purchase at the lower price. Microsoft, AMD and Starbucks made public their latest earnings report after the market close.

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Microsoft stocks, the second most influential stock holding a weight of 8.49%, fell 2.70% after releasing their earnings. The price fell due to the Cloud revenue not reaching previous expectations. However, investors should note that earnings from the Cloud sector have still significantly risen from the previous quarters and the company overall beat earnings and revenue expectations. Microsoft earnings beat expectations by 0.25% and Revenue by 0.45%.

On the other hand, AMD and Starbucks stocks rose in value after releasing their reports. AMD stocks rose 7.64% and Starbucks 3.63%. This evening, after the US market closes, Meta, Qualcomm and Lam Research will release their quarterly figures. The 3 stocks make up a weight of 6.56%. This is a moderate weight and not as influential as the above-mentioned stocks. However, the release can still significantly change the sentiment towards the stock market.

The stock market fell after the US’s JOLTS Job Openings and CB Consumer Confidence beat expectations set by analysts. Investors will continue to monitor employment data throughout the week. However, tonight’s Federal Reserve press conference and forward guidance will be key for the foreseeable future. Particularly, a clear indication of a rate cut in September and another by the end of the year.

Analysts advise the regulator will maintain the base rate at 5.25–5.50% for the eighth consecutive meeting. However, during the press conference, Fed Chair Jerome Powell might hint at a 0.25% point rate cut in September, the first in over four years. Futures tied to the US interest rate suggest the possibility of three rate cuts this year, though most experts anticipate only two, in September and December.

The NASDAQ’s price still remains below the trend-line and 100-Period SMA. In addition to this, the RSI trades at the Neutral level. Therefore, the price is not yet obtaining a clear longer-term buy signal yet. However, investors who wish to speculate the recent upward price movement can aim for the recent resistance level at $19,194.03, which is also in line with the trend-line.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 29th July 2024.

The Japanese Yen Leads as Global Central Banks Anticipate Cuts!

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A Japanese flag flutters atop the Bank of Japan building in Tokyo, Japan, September 21, 2016. REUTERS/Toru Hanai/File Photo - RTX2UM36

* Markets watch global central banks confirm their latest rate decision. This week includes Bank of Japan, Federal Reserve and Bank of England.
* Global stocks rose on Monday! The NASDAQ rises 0.67% as major tech-earnings edge nearer.
* Tuesday’s earnings releases include Microsoft, ADM and Starbucks.
* Analysts expect the Fed to ready the markets for their first interest rate cut since 2020.

USA100 – Market Shows A “Risk-On” Appetite Ahead Of Microsoft Earnings!

After a nearly 10% drop in July, the NASDAQ seeks to regain momentum before a major bank decision. This week’s central bank decisions include Bank of Japan, Federal Reserve and Bank of England. Analysts expect the Federal Reserve and the Bank of England to keep interest rates unchanged but signal to the market that an adjustment will take place in September. However, according to most analysts, the Bank of England is more likely to cut than the Fed if a shock decision is to take place.

The latest price action forms higher highs and lows but continues to remain below the recent high from June 25th. As a result, technical analysts advise a correction is not yet fully signaled. According to fundamentalists, strong earnings data on Tuesday is not likely required to strengthen signals pointing to a full correction.
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Tuesday evening will see Microsoft, AMD and Starbucks release their latest earnings reports. The three companies make up more than 10% of the weight of the NASDAQ, hence can trigger strong volatility. Analysts expect Microsoft, the second most influential stock for the NASDAQ, to see earnings remain unchanged from the previous quarter and revenue to rise by $2.58 billion. The stock this year so far has risen 14.70% and $52 below its recent high.

According to fundamental analysts, if the earnings data from Microsoft and AMD beat expectations and the Fed confirms a rate cut in September, the possibility of a correction significantly increases, if not certain. Currently, the market movement indicates a higher risk appetite and sentiment amongst investors. All global indices are trading higher including the DAX, Euro Stoxx 50 and Nikkei225. In addition to this, US bond yields fall as does the VIX. If both continue to fall, the movement will indicate a “risk on” appetite.

GBPJPY – Will the BoE Adjust Interest Rates?

The Japanese Yen has been by far the best performing currency over the past week, increasing in value by 2.50%. The British Pound is also the worst performing currency of the day declining by 0.20%. According to experts, the Bank of England is not likely to cut interest rates at this week’s rate decision but will lay the path down for a rate cut at the next meeting.

Suren Thiru, economics director at the ICAEW, advises he still expects the BoE to lower interest rates to 4.75% by the end of 2024, however, “a rate cut this month is looking less likely”,whereas a Reuters poll found that 80.0% of respondents, expect the UK regulator to cut interest rates in August.  Nonetheless, a shock rate cut or a clear signal for the next rate decision can still pressure the British Pound if the signal is clear enough. Simultaneously, the JPY is benefiting as the only currency to see a strengthening monetary policy while the rest of the world cuts.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 26th July 2024.

The Yen Soars as the Likelihood of a BoJ Rate Hike Rises!

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* The Japanese Yen wins back some lost ground as global Central Banks edge closer to rate cuts.
* The probability of another interest rate hike by the Bank of Japan increases.
* July’s best performing currencies are the Japanese Yen (+4.35%), British Pound (+1.41%) and the Swiss Franc (+1.41%).
* Currencies are taking advantage of the weaker US Dollar, but the worst performing currency remains the New Zealand Dollar.

USDJPY – Growing Likelihood of a Second BoJ Rate Hike!

The USDJPY increases in value for a third consecutive week and for a fourth consecutive day. Three factors are contributing to the Dollar decline: The Fed’s upcoming interest cut, the Bank of Japan’s interest rate hike and the political uncertainty in the US. The day’s best performing currency is the Japanese Yen which is currently increasing in value against all currencies.

Currently, the USDJPY is trading below the trend-line and below the 100-Period SMA which indicates in the medium-term sellers are controlling the price actions. The exchange rate is also below the neutral on all oscillators and forms a clear bearish trend price pattern. Currently the only indications pointing towards a loss of bearish momentum is the diversion formed on the RSI. As a result, even though the trend clearly forms downwards, investors need to be cautious of a potential retracement. If the price trades above 152.96, a larger retracement becomes likely. However, if the price falls below 152.015, momentum will indicate the continuation of the downward trend to 151.674 in the short term and 151.267 thereafter.

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The likelihood of further monetary policy tightening by the Japanese regulator is growing. Preliminary data for July showed an increase in business activity, indicating a recovery in the national economy. The consumer price index remains above the target level, reaching 2.8% in June, with the core indicator stabilizing around 2.6%. Officials are optimistic about maintaining these high levels, supported by significant wage increases.

According to Reuters, Bank of Japan officials will discuss the possibility of raising the interest rate at their meeting on July 31st. Analysts do not expect active measures until after the summer months. However, investors will price in the adjustment before the decision takes place.

The US Fed experts may turn to “dovish” rhetoric in September, which puts pressure on the dollar. Currently, inflation is slowing growth, business activity is declining, and the labor market is showing signs of cooling.

The US PMI data from yesterday largely triggered an attempted bullish correction but was viewed as mixed. The price action of the US Dollar and the USDJPY will now largely depend on the Gross Domestic Product and Weekly Unemployment Claims. These will be made public at 12:30 GMT. Analysts expect the US economy to grow 2.0%. If the US GDP reading is lower than expectations, the US Dollar potentially can come under pressure. At the same time, weaker earnings data from the US can trigger higher demand for the Japanese Yen. The Yen is known as a safe haven currency alternative to the Dollar.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 25th July 2024.

Market News – AI mania over? Stocks, Gold & oil dip; Yen Surges.

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Economic Indicators & Central Banks:

* Wall Street plunged and Treasuries bear steepened in an anxious trade.
* News that ex-Fed president Dudley was now calling for the FOMC to cut rates next week amid recession fears added to investor angst.
* European stock markets continued to decline alongside Asian equity futures, intensifying a global downturn in technology shares following US session, as investors are pulling back on the artificial-intelligence frenzy that has powered the bull market this year.
* Traders moved away from megacaps to underperforming segments of the market, driven by expectations of Fed rate cuts and doubts about AI’s immediate payoff.
* Nasdaq experienced its largest single-day drop since 2022, while S&P 500 breaks Its longest run without a 2% drop since 2007.
* The Canadian Dollar dropped as the Bank of Canada cut rates, emphasizing “downside risks are taking on increased weight in our monetary policy deliberations.”
* The Japanese Yen reached its highest level since May as carry trades unwound.
* Key events today: Germany IFO business climate, US GDP, initial jobless claims, durable goods.

Asian & European Open:

* Tech led the slump with the NASDAQ dropping -3.64%, the biggest 1-day selloff since March 2020. The S&P500 fell -2.31%. The Dow dropped -1.25%. Disappointing news from Alphabet and Tesla after the bell Tuesday got the bears going and rising concerns over the staying power of AI trades exacerbated declines through the day.
* In Japan, Nikkei entered a technical correction while the broad Topix index, which had reached a record high earlier this month, plunged over 2.5%, erasing its July gains and hitting a five-week low.
* Earning: Apple, Microsoft, Amazon, and Meta are set to report results next week.

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Financial Markets Performance:

* The USDIndex tumbled to 104.12 in morning action, down from Tuesday’s 104.45, but rallied back slightly to close at 104.37.
* The Yen holds strong thanks to expectations for a BoJ rate hike next Wednesday, with USDJPY breaching 200-day EMA. The USD firmed versus CAD after the BoC’s dovish cut. The USDCAD reached April’s peak at 1.3827.
* Oil prices declined, but are once again trying to stabilize, following API data showing that US crude inventories declined by 3.9 million barrels last week. Inventories have declined for four straight weeks now. However, weak growth in top importer China and renewed optimism of a ceasefire in the Middle East have kept supply expectations underpinned. WTI is currently trading at USD 77.38 per barrel, Brent at USD 81.49 as markets wait for the official U.S. inventory report.
* Gold is down to $2370 to a two-week low. The downfall could be attributed to some technical selling, though it is expected to be limited, considering the fundamentals, such as Fed’s cut and the risk-off mood which could support Gold ahead of the US data.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 24th July 2024.

Market News – Stocks dip as earnings disappoint; Yen strengthens further.

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Economic Indicators & Central Banks:

* The market faces pressure entering a seasonally weak period, with potential increased volatility due to the upcoming US presidential election.
* Asian stocks and US stock futures also fell, impacted by earnings reports from large American firms like Tesla Inc. and Alphabet Inc., which were seen as insufficient to sustain the recent global equity rally.
* European stock futures declined as investors evaluated the disappointing initial results from the “Magnificent Seven” megacap tech companies.
* The Yen strengthened for the third consecutive day ahead of next week’s Bank of Japan meeting.

Asian & European Open:

* The S&P500 and Dow slipped -0.16% and -0.14%, respectively, and the NASDAQ slid -0.06%. The VIX was down -1.74% to 14.65 and has eased from the 16.52 level on Friday, the highest since April amid rising political risks and anxieties.
* Taiwan’s stock market was closed due to Typhoon Gaemi, meaning shares of Taiwan Semiconductor Manufacturing Co. did not trade.
* Alphabet shares fell after the company indicated that it would take time to see tangible results from its AI investments.
* Tesla shares dropped as much as 7% following a profit miss and a delay in its Robotaxi event to October. Many of Tesla’s suppliers and electric vehicle peers in Asia also saw declines.
* Deutsche Bank AG reported its first quarterly loss in 4 years due to a slowdown in trading and a charge related to a legacy issue at its Postbank retail unit.
* BNP Paribas SA’s profit increased in the second quarter, driven by a surge in equities trading revenue.
* United Parcel Service Inc. experienced its worst drop ever following a profit miss.

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Financial Markets Performance:

* The USDIndex had found its footing, firming to 104.25 versus 103.90 on Monday.
* The Yen appreciated beyond 155  for the first time since early June as traders anticipated a potential interest rate hike from the BOJ in the coming months, if not at next week’s meeting. According to a Bloomberg survey, around 30% of BOJ watchers expect a rate hike on July 31, but over 90% believe there is a risk of such a move.
* The NZDUSD dropped at 0.5900 to its lowest level in nearly 3 months as lower bond yields discouraged carry trade investors.
* Oil fell -1.45% to $77.26, though managed to edge up from the $76.40 session low. It is a 4th straight decline from $82.85 Wednesday and the weakest since mid-June. Most of week’s selling was on technicals after penetrating 50- and 100-day MA.
* Gold is up to $2418 per ounce. It was at an all-time closing peak of $2469.08 on July 16 amid expectations for Fed rate cuts, US political risks, and the drop in the US Dollar. Of note, India lowered its import duty on gold to 6% from 15% which should support jewelry manufacturing. India is next only to China in terms of consumer demand.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 23rd July 2024.


Market News – Asia stocks up; Yen Strengthens.


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Economic Indicators & Central Banks:


* Markets paused after recent volatility and a tech selloff driven by high valuations and sector rotation.
* US election developments continue to dominate, with Kamala Harris securing enough pledged delegates for the Democratic presidential nomination, providing some political clarity.
* Asian stocks climbed, driven by gains in chipmakers following a Wall Street rebound ahead of major tech earnings reports.
* Treasury yields fell ahead of economic data releases and the Federal Reserve’s preferred inflation measure. Throughout July, speculation about a September rate cut boosted shorter-term bonds, narrowing their yield gap with longer-term securities.


Asian & European Open:


* US equity futures dipped, and Euro Stoxx 50 contracts rose in anticipation of earnings from Tesla Inc. and Alphabet Inc. later today.
* Nasdaq and S&P500 were both up more than 1%, reversing some of last week’s painful decline.
* The “Magnificent Seven” stocks rose over 2% on Monday, led by Tesla and Nvidia Corp.
* Toyota Motor Corp. plans to repurchase shares from major Japanese banks and insurers as part of a ¥1 trillion buyback plan.


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Financial Markets Performance:


* The USDIndex remains in a ranging market, between 103.90-104.15.
* The Yen appreciated against the US Dollar, as traders adjusted their carry positions during the summer holiday season, with USDJPY breaching 156.20. Some Bank of Japan officials are open to raising rates at the July meeting, though weak consumer spending complicates the decision.
* Oil prices remained steady near a 6-week low as traders awaited new data on market balances and US stockpile forecasts.


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


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


Click HERE to access the full HFM Economic calendar.


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


Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 22nd July 2024.

Market News – Uncertainty remains the bane of the markets!

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Economic Indicators & Central Banks:

* President Biden announced he is withdrawing from the re-election campaign. In a subsequent comment, he stated his support for Kamala Harris. He will address the nation later this week. This throws the Democrat party into more disarray as it heads into its convention from August 19-22.
* These uncertainties will further shake up the markets when trading opens.
* For weeks, investors have speculated about an increased likelihood of Donald Trump winning the November election, especially after Biden’s underwhelming debate performance. Now, with Biden exiting the race, investors are reconsidering their strategies regarding a potential Trump victory.
* China’s PBoC cut its 7-day reverse repo rate by -10 bps to 1.70% from 1.80% in a surprise move coming out of the Third Plenum.
* Earnings: Tesla Inc. and Alphabet Inc. will kick off earnings reports for the “Magnificent Seven” on Tuesday, while major European banks are set to report their earnings this week as well. Analysts will be watching to see if the benefits from higher interest rates are diminishing and how recent political developments are impacting market sentiment.

Asian & European Open:

* It is a cautious, choppy start to trading in the wake of the news. This negative start to the week mirrored the losses seen on Wall Street on Friday, as businesses globally dealt with a major technology outage.
* Asian stock markets mostly fell after President Joe Biden’s announcement. Hong Kong’s Hang Seng has rallied 0.82% but the Nikkei is down -1.3% amid the fallout from Friday’s slump on Wall Street.
* US futures remained relatively stable while European stock futures are higher.

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Financial Markets Performance:

* The USDIndex has traded narrowly, but initially dropped to 103.90 versus Friday’s close at 104.396. It is mixed against its G10 peers.
* USDCNY has been jumpy, impacted both by the PBoC’s news as well as the Biden news earlier. The buck rose to 7.2737 in early action before sliding to 7.2706. It has edged back to 7.2730.
* Metals showed mixed results following their worst weekly decline in nearly two years, with a rate cut in China helping to stabilize the market.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HFMarkets

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

HFM



Date: 19th July 2024.

Global Stocks Tumble as Risk Appetite Plummets!

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US ECONOMY

* The NASDAQ declines for a third straight day and fell to its lowest level for July.
* Netflix Quarterly Earnings Report unable to support US indices. The Dow Jones loses momentum after 6 straight bullish days.
* The US Dollar Index attempts to regain losses from earlier in the week and trades 0.65% higher than yesterdays
* The British Pound comes under pressure from the decline in Retail Sales. However, the New Zealand Dollar continues to be the worst performing currency.

GBPUSD

The British Pound against the US Dollar is losing momentum for two reasons. The first is that the exchange rate is largely being driven by the Dollar which has risen in value across the board. The US Dollar Index is attempting to regain loses from earlier in the week and trades 0.65% higher than yesterdays open. This is partially due to the lower price but also the lower investor sentiment as stocks falls over the past 3 trading days.

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The second reason is the poor economic data from the UK which is likely to pressure the Bank of England to adjust interest rates at the next meeting. According to economists a 25-basis point cut at the next meeting is not yet certain. However, a cut will take place either on the 1st of August or September 19th unless something drastic changes. The poor data includes the number of new unemployed individuals which has considerably risen over the past 2 months. This morning, the UK government also confirmed Retail Sales has fallen 1.2% which is double the decline previously expected.

For the US, weekly employment data was released yesterday: the number of Unemployment claims rose by 243,000, exceeding both the forecast of 229,000 and the previous figure of 223,000. Additionally, the total number of citizens receiving government assistance increased from 1.847 million to 1.867 million, raising the likelihood of interest rate adjustments in September. According to most analysts, the rate cut for September is fully priced in at around 103.20 for as long as other central banks also adjust.

The US Federal Reserve’s Beige Book, published this week, indicates that economic activity is growing at a moderate pace, but businesses expect a slowdown over the next six months due to the US election campaign and consumers struggling with prices. However, the lower risk appetite is triggering higher demand for the Dollar over the past 48 hours. It’s vital investors continue to monitor the US Dollar Index while analysing the GBPUSD.

The price of the exchange is now trading below the 75-Period EMA and below the 50.00 on the RSI. This indicates low sentiment towards the Pound and bearish control for the time being. Fibonacci retracement levels indicate a sell signal will arise at the 1.29290 price whereas the breakout level indicates 1.29261. however, if the price rises above 1.29400 or the trendline, short-term sell signals become unlikely.

USA100

The price of the NASDAQ has now fallen for 3 consecutive days but did see less downward momentum compared to Wednesday’s collapse. The index has now fully corrected the gains for the first 2 weeks of the month and is trading close to the previous support level. However, as previously mentioned, due to the higher economic risk, investors will most likely need strong earnings data to be tempted to purchase the discount unless the price becomes even more favourable.

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The price of Bond Yields has risen during this morning’s Asian session and the VIX is also trading slightly higher. The VIX this week has already added almost 10% which indicates a significant decline in risk appetite. In addition to this, the poor data from the rest of the world’s leading economies can also damage sentiment towards stocks. Currently the biggest indication for short term upward price movement is the lower price and potential upcoming earnings data.

Netflix has released their earnings report overnight. The company’s earnings read 2.40% higher than expectations at $4.88 and revenue was 3 million higher than expectations. However, the stock is yet to see any major volatility or support. Currently the stock trades 0.18% lower.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 18th July 2024.

Escalating Tariffs on China Spark a Major Selloff in Tech Stocks!

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Trading Leveraged Products is risky

* Investors expect the European Central Bank to keep interest rates at 4.25%.
* US confirms new sanctions against China primarily aimed at semiconductors applying significant pressure on Tech Stocks.
* The NASDAQ trades more than 4% lower than its recent highs. Investors reduce their involvement in growth stocks as top economists predict a decline in consumer demand.
* The top 10 most influential stocks for the NASDAQ fell an average of 3.97% on Wednesday. Netflix due to release their earnings report today after market close.

USA100 – Tariffs Intensify Against China Triggering A Tech-Stocks Selloff!

On Wednesday, the NASDAQ fell a total of 2.82% and is trading 4.25% lower than its recent highs. The reason behind the quick selloff is twofold. At first the NASDAQ saw lower demand as leading bankers and economists signalled weaker consumer demand from the lower income portion of the economy. The second is the United States decision to intensify sanctions on chips being sold to China. As a result, the semiconductor sector took a big hit and had a domino effect on the rest of the technology market.

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The Semiconductor selloff seen yesterday was the biggest in four years, but investors also should note that at some point a lower price can trigger investors to buy the dip. Though the question remains as to when that is likely to happen.  After the market close, in after trading hours, most of the semiconductor sector rose in value, but still remain significantly lower than the open price.

Investor willingness to purchase the dip will also depend on earnings data which will start this evening. Netflix is due to release their quarterly earnings report after market close. Analysts expect the company’s earnings per share to rise from $4.54 to $4.76 and for revenue to increase by 25 million. Netflix’s stock fell less than other components during yesterday’s decline which can be perceived as a positive. However, the price action will depend on tonight’s reports.

Investors are only likely to enter at the discounted price if earnings data from the most influential companies beat expectations and cool down concern over consumer demand. The most influential day for earnings will be next Tuesday where Microsoft, Alphabet (Google), Tesla and Visa release their reports. Whereas, if earnings are not able to increase demand, the sanctions imposed have the ability to reduce sentiment towards the sector for a prolonged period.

Currently, the price of the NASDAQ trades lower than most Moving Averages and lower than the neutral on the RSI. However, the price is retracing upwards. Therefore, investors will monitor whether the price will attempt a correction or decline further. If the price falls below $19,879.33, momentum indicators are likely to signal a decline, whereas above $20,100 will bring the price above the trend line which can indicate an attempted correction to $20,405.

EURGBP – UK Adds High Number Of Unemployment Claims!

The price of the EURGBP increased in value after the UK’s Claimant Claims rose by 32,300, almost 10,000 more than analysts’ expectations. Over the past two months the UK has added 82,600 more unemployed individuals. As a result, the Bank of England may be more tempted to decrease interest rates at the next meeting but according to analysts this is not yet certain.

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Nonetheless, the price has increased 0.11% and risen above the 75-Period Moving Average on the 2-hour chart. If the price rises above 0.84145, the exchange rate potentially will maintain a buy signal. This will also depend on today’s ECB Rate Decision and Press Conference. Analysts expect the rate to remain at 4.25% but are hoping for guidance on when the next cut is likely.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 17th July 2024.

Gold Hits New All-Time High as Investors Flee the Dollar!

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Trading Leveraged Products is risky

* Gold reaches an all-time high as investors look to mitigate away from political risk and a potential economic slowdown.
* UK inflation remains unchanged whereas analysts previously expected a 0.1% decline.
* Economists contemplate whether the Bank of England will opt to adjust interest rates in August or wait for September’s meeting.
* All US indices increase in value bar the NASDAQ which fell 0.18%. The SNP500 rises 0.64% and the Dow Jones 1.85%.

XAUUSD – Gold Rises To All-Time High!

Gold rises to an all-time high after increasing in value by almost 2% on Tuesday. Investors are turning to Gold in an attempt to mitigate political risk, interest rate adjustments and also the possibility of weaker economic growth. Weaker economic growth has been mentioned by leading economists over the past week which is prompting higher gold demand.

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However, the price of Gold did witness an overbought signal on the RSI for the first time this week at $2,472.85 and soon after fell 0.45%. Here we can see how the RSI assisted traders with determining that Gold may have stretched too far. Currently, as the price retraces lower, the price is no longer overbought and still continues to maintain buy signals on the 2-hour timeframe. Though investors will look for bullish momentum to build before speculating in favor for the trend. For example, if breakout signals can be seen at $2,470.95 and $2,472.70 or Fibonacci retracement signals a buy indication at $2,475.00.

A positive factor for Gold is the decline in the US Dollar which currently is trading 0.08% lower this morning. Though, investors would prefer the decline to gain momentum. In addition to this, the pricing of interest rate adjustments is also supporting the value of Gold. According to the CME Exchange, there is a 93% chance of a 25-basis point cut and a 7% chance of a 50-basis point cut for September.

A large portion of the demand for Gold in 2024 derives from China and is largely the reason why gold has surged more than 21% so far this year. China will suspend gold supplies, but experts believe the government will continue to import without reporting it. It may indicate an intention to purchase more gold than before, following the trend set by global central banks, which are actively replenishing their reserves. Thus, the National Bank of Poland increased gold volumes by 4.0 tons in June. Additionally, the National Bank of India purchased 9.0 tons, and now the country’s reserves amount to 841.0 tons. Regardless of this, lower interest rates can support Gold and short-term traders will focus on the trend and technical analysis.

GBPUSD – UK Inflation Remains Sticky!

The price of GBPUSD has increased in value after the UK inflation remained at 2.00% instead of declining to 1.9%. As a result, economists are contemplating whether the Bank of England will opt to adjust interest rates in August or wait for September’s meeting. Previously, investors were leaning more towards a cut in August. Currently investors monitoring price action are evaluating whether the price will rise above the most recent resistance level which has formed a double top.

The price of the US Dollar will also be detrimental to the price movement of the exchange. Currently, the US Dollar Index has fallen 0.12% so far this morning. Throughout the day the Building Permits and Industrial Production will influence the price of the US Dollar. The GBP will now turn its attention to the release of the UK’s Claimant Claims Change and Average Earnings Index.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 16th July 2024.

Pound Leads Currencies This Month Despite Upcoming Rate Cut!

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* The Pound continues to be the month’s best performing currency and attempts to break resistance levels as the currency rises close to a 12-month high.
* Goldman Sachs beats earnings and revenue expectations boosting banking stocks. Goldman Sachs, JP Morgan and Wells Fargo stocks increase.
* The Dow Jones outperforms the NASDAQ and SNP500 on Monday. Goldman Sachs and Caterpillar were the best performers.
* Federal Reserve Chairman advises economic growth likely to slow and employment to become more balanced.

GBPUSD – Economists Expect The UK Economy To Perform Better Than Previous Expectations.

The GBPUSD, after increasing in value for 2 consecutive weeks, finds itself close to a 12-month high and closer to its traditional value prior to COVID and PM Truss. The British Pound has been the best performing currency of July and has risen in value against all major currencies. The US Dollar has been one of the worst performing, but traders may also benefit from glancing at the weakest which currently are the NZD and JPY.

Technical analysis in recent days has been pointing towards an upward trend as the price trades above the 75-Period EMA and 100-Period SMA. Fundamental analysis is also supporting a weaker Dollar as a rate cut becomes certain for September 2024.

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Though, the price over the past two trading days has struggled to increase above the 1.29897 resistance level. The exchange rate has failed to break this level on 3 attempts and mainly formed a psychological price for investors. However, this will largely depend on today’s US Retail Sales and tomorrow’s UK inflation rate.

Analysts believe the UK inflation rate will fall from 2.00% to 1.9%, which is below the Bank of England’s target. Nevertheless, the regulator will be happy to allow inflation to fall slightly below due to the cost-of-living crisis of the past 3 years. The Bank of England’s rate decision will take place on August 1st, and an interest rate cut will become more likely if inflation falls to 1.9%. Currently, most economists expect a rate adjustment.

A rate cut traditionally is bad for the currency, however, it can make the economy more attractive for foreign investors. However, investors should note, currency traders will simultaneously price in a cut from the Fed. The Chicago Exchange for the first time fully prices in a rate cut for September.

For the US Dollar, the latest developments continue to point towards slower economic growth and unemployment rising slightly higher. Yesterday’s Empire State Manufacturing Index again read lower than expectations. In addition to this, Jerome Powell, the Fed Chairman, also reaffirmed this is also the Central Bank’s expectations. Whereas the analysts expect the UK economy to rebound faster than previous years. Analysts also note that the US Bond Yields trade 24-points lower, which is known to be negative for the Dollar.

Therefore, many fundamental factors also indicate a GBPUSD bullish trend. However, in the short-term technical analysis will be key. Traders may opt to keep buy trades short term unless strong momentum indicates a break above the key resistance level which is close. However, if a retracement is to continue, price action points towards the retracement falling down to 1.29238.

USA30 – The Dow Jones Outperforms All Indices!

The Dow Jones, which traditionally is less prone to trends, was the best performing index on Monday. Yesterday, it rose to an all-time high after increasing for 3 consecutive weeks. The bullish trend has partially been due to the market pricing in an interest rate cut for September but also earnings data from the banking sector.

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Goldman Sachs is the latest bank to release their quarterly earnings report. The bank’s earnings were slightly higher than previous expectations, but lower than the previous quarter. Revenue beat Wall Street’s expectations by 2.89%. As a result, stocks from the banking sector rose in value helping the bullish trend of the Dow Jones.

However, investors are concerned regarding comments from key economists and the Fed’s Chairman. The recent forward guidance is lower economic growth and higher unemployment. This can be concerning for the stock market if economic data weakens, and leading companies provide similar guidance. Another concern is that only 55% of the Dow Jones’s 30 stocks rose in value. Though, the 55% that rose saw stronger volatility.

Today UnitedHealth Group will release their earnings report. Currently, analysts believe the earnings will more or less be similar to the previous quarter. UnitedHealth Group is the index’s most influential stock and is likely to create volatility. However, this may also potentially be a retracement, not necessarily a guaranteed upward trend.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

HFM



Date: 15th July 2024.

US Stocks Surge Amid Banking Sector Concerns Over Consumer Demand!

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Economic Indicators & Central Banks:

* US Banks beat earnings expectations but warn of financial stress amongst lower and middle-income consumers over the upcoming months.
* Producer Inflation unexpectedly remains high, but investors opt to take advantage of the lower price.
* Political experts advise Trump’s chances of winning this year’s elections are significantly higher after the recent assassination attempt.
* All currencies indexes decline as the US Dollar attempts to win back some lost ground.

USA100 – Large US Banks Voice Caution As Consumer Demand Falls!

The NASDAQ rose on Friday despite the US inflation data reading higher than what investors would have preferred. According to analysts, investors preferred to take advantage of the lower purchase price and Thursday’s 2.20% decline. Investors potentially may still look to increase exposure in stocks and indices to price in a rate cut and strong earnings data.

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The Producer Price Index read 0.2% vs 0.1% expectation. Though investors were concerned that the Core Producer Price Index was more than double previous expectations. However, the positive news is that the US inflation rate fell from 3.3% to 3.0%, the lowest since June 2023. Today investors will focus on the release of the Empire State Manufacturing Index which could benefit from a slightly higher reading. In addition to this, the Fed Chairman will speak at 16:00 GMT which may also trigger volatility depending on comments.

None of the earnings reports released Friday were part of the NASDAQ index, but they surely grabbed investors’ attention. JP Morgan, CitiGroup and Wells Fargo all beat earnings and revenue expectations, however, all stocks depreciated in the session that followed. Particularly Wells Fargo which fell more 6.00%.

The main cause was the forward guidance given by all 3 banks regarding the economic conditions in the upcoming months ahead of the elections. Profits at Citi’s US consumer lending division, which encompasses credit cards, plummeted by 74% compared to last year. The bank’s chief financial officer, Mark Mason, noted that consumer spending is generally declining, with account balances now falling below pre-Covid levels. In addition to this, JP advises lower income consumers are likely to struggle over the next 3-4 months.

Nonetheless, in terms of technical analysis, the price of the NASDAQ is again trading above the 75-Period EMA and 100-Period SMA. In addition to this, the RSI trades above the 50.00 level which indicates buyers are regaining control of the market. Buy signals are likely to strengthen as the price crosses above the $20,471.10 and $20,552.77 levels.

EURUSD – The Dollar Gains As The Exchange Rate Rises To Previous Resistance Level!

The EURUSD currently trades with an extremely low spread and a bearish price gap. The US Dollar Index is currently trading 0.15% higher while the Euro Index is 0.16% lower. However, on the medium-term timeframe the Euro is witnessing significant gains against the Dollar after rising for 3 consecutive weeks. However, this has brought the exchange rate to the previous resistance level of the price range. Therefore, technical analysts are considering whether this may be the point where the EURUSD retraces lower.

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Currently, the support and breakout level can be seen at 1.08823 and if the price falls below this level potentially can prompt a short-term sell signal. A short-term sell signal potentially can indicate a decline to the 1.08667 level. The Empire State Manufacturing Index this afternoon potentially can support momentum to form a breakout if the index reads higher than current expectations.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

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