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Date: 15th August 2024.

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


  • 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.



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!



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.
 
Date: 16th August 2024.

Markets corrected again; Stocks skyrocketed.


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.


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.
 
Date: 19th August 2024.

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


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.


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.
 
Date: 20th August 2024.

Market News – Its all about market sentiment.


  • 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.
Asia & European Market:

  • 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.
 
Date: 21st August 2024.

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


  • Equities 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.
Asia & European Market:

  • 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.


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.
 
Date: 22nd August 2024.

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


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.


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.
 
Date: 23rd August 2024.

Market News – The Big Day!


  • 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.


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.
 
Date: 26th August 2024.

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


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.


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.
 
Date: 27th August 2024.

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


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.


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.
 
Date: 28th August 2024.

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


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 remained 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.
 
Date: 29th August 2024.

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


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.


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.
 
Date: 30th August 2024.

Market Volatility, Stock Market and Upcoming US Elections.



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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WELLS FARGO INVESTMENT INSTITUTE

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.
 
Date: 2nd September 2024.

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


  • 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.



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.


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.
 
Date: 3rd September 2024.

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


  • 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.

Technical Analysis – Gold


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.
 
Date: 4th September 2024.

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


  • 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.



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.




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.
 
Date: 5th September 2024.

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


  • 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

In terms of technical analysis, the exchange rate on the daily timeframe is witnessing divergence and the volatility over 3 days is as much as we saw over the past week and a half. Therefore, the possibility of a retracement remains. However, on smaller time frames, momentum indicators continue to point towards the Japanese Yen gaining.



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.
 
Date: 9th September 2024.

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


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.



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.
 
Date: 10th September 2024.

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


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.


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.
 
Date: 11th September 2024.

Market Update – Safe Havens in Demand; Eyes on CPI.


Investors remain cautious about the gloomy outlook for China’s economy & worry that the Fed has delayed easing monetary policy. Traders are anticipating at least 1 significant rate cut this year, ahead of the CPI report, which is expected to show modest inflation growth.

Asia & European Sessions:


  • Asian equities dropped for a 3rd consecutive session, with Japan and Hong Kong leading the downturn.
  • US stock futures slid overnight by 0.6%, as renewed fears of slowing growth in major economies coincided with oil prices stabilizing below $70 and global bond yields hitting a 2-year low.
  • Harris-Trump’s debate over the state of the economy and US-China relations had an insignificant impact on the markets. Harris saw her odds of winning the election rise on PredictIt from 53% to 56% following the debate.
  • BOJ policy member Junko Nakagawa hinted at the possibility of further interest rate hikes, boosting Yen to December’s highs. While many economists predict the BOJ will wait until later this year or early next year to raise rates, the next decision is scheduled for next week.
  • The CHF is at decades highs against USD, supporting speculation for an aggressive interest rate cut on September 26. Markets expect a 25bps cut, while the likelihood of a 50 bps cut has been increasing.
  • The UK economy unexpectedly stagnated in July. GDP has stagnated for two months now, suggesting that despite the robust survey numbers, Q3 GDP growth is likely to disappoint. With interest rates down and wage growth still robust, construction and consumption should get a boost, although this side of the budget there is still a lot of uncertainty that is likely to hold consumers and companies back. For the BoE it won’t be enough to prompt back to back cuts, but it will justify the controversial decision to lower rates last month.
  • CPI preview: The August CPI report will be the highlight, just in case there are any surprises that could tip the policy outlook. We expect gains of 0.2% for both headline and core after 0.2% increases for both in July. As-expected results would see the y/y headline sliding to 2.6% from 2.9% in July. Also, the core y/y gain should hold steady at 3.2% in July. Such results should not deter the FOMC from cutting rates.
A higher inflation reading today could lead to increased volatility ,while a softer number might give the Fed more room to cut, but could also signal faster-than-expected economic slowdown.



Financial Markets Performance:

  • The Yen surged to its strongest level against the US Dollar since December, recovering its yearly losses. It is currently at 141.40 after retesting the 140.696 level.
  • The USDCHF drifted further to a 13 year bottom, with CHF and JPY buoyed by faltering carry trades funded through low-interest currencies and increased demand for safe-haven assets. EURCHF remains below its 2015 bottom.
  • Bitcoin dipped to $56k again due to Trump’s support for the cryptocurrency sector.
  • Oil extended the month’s downleg to 65.34, dropping by nearly 20% this quarter, as worries about slowing growth in the US and China dampen 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.
 
Date: 12th September 2024.

Market Update – Eyes on ECB!


US inflation data supported bets for a rate cut from the Fed next week, but also argued for gradual moves.

Asia & European Sessions:

  • Selling initially drove the moves on Wall Street and Treasuries as the pick up in the monthly US CPI core rate weighed on aggressive Fed rate cut bets, and basically confirmed a -25 bp reduction next week. However global equities turned around and dip buyers provided support with the major indexes bouncing off of support.
  • European stock markets are broadly higher in catch up trade, after Wall Street turned optimistic yesterday and the tech rally extended through Asian hours. Japanese markets, which were hit by a rally in the yen earlier in the week, bounced back and the Nikkei closed 3.4% higher. DAX and FTSE100 are currently up 1.2% as markets wait for the ECB to deliver the widely expected 25 bp rate cut.
  • Tech stocks like Amazon, Microsoft, and Nvidia drove Wall Street’s gains, pushing the S&P 500 and Nasdaq higher.
  • ECB Preview: Comments from officials have left little doubt that rates will be cut by 25 bp once again at tomorrow’s meeting. It is likely to be another “cautious cut”, however, that doesn’t commit to additional moves. Growth indicators may have come in lower than hoped, and headline inflation dropped sharply. Underlying inflation, though, remains high and that means Lagarde is likely to stick with a data-dependent approach. We expect further cuts, but for now only at meetings with updated staff projections. A 25 bp cut would leave the deposit rate at 3.50% and the main refinancing rate at 4.00%. However, the ECB announced earlier in the year that it intends to lower the spread between the deposit rate and the main refinancing rate to 15 bp from currently 25 bp. That will come into effect on September 18, together with the changes announced tomorrow. That will leave the main refinancing rate at 3.65%, the marginal lending rate at 3.90%.
Financial Markets Performance:

  • The USDIndex is at 101.796 and USDJPY has lifted to 142.66 amid a wider correction in the Yen.
  • Oil rebounded 2.19% to $67.80 per barrel due to Hurricane Francine affecting Gulf of Mexico production.
  • Gold dipped -0.15% to $2512.89 per ounce after rising to a session high of $2528.98 per ounce.
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.


Andria Pichidi
Market Analyst
HFMarkets

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