HFMarkets (hfm.com): Market analysis services.

[HFblogNews]

Date: 6th December 2023.

Market Recap: The wait is on for Friday’s jobs report!

Economic Indicators & Central Banks:

*Treasury yields extended lower after the larger than expected decline in job openings. The data added to beliefs that the labor market is cooling and that the FOMC is done hiking, with the next move a cut in the coming months.
*Fed funds futures are reflecting about a 65% bet for a 25 bp March cut, with May fully priced in and then some.
*German manufacturing orders plunged. Orders corrected -4.6% in the three months to October, which is flagging recession risks and ongoing weakness even going into 2024.

Market Trends

*Asian stock markets rallied, with Japanese markets leading the way. Futures are also higher across Europe and the US as markets buy in to hopes that major central banks have reached peak rates and will start to cut interest rates next year.
*GER40 is at all-time highs supported by slowing inflation and the prospect of lower interest rates next year boosting the country’s biggest stocks. It gained 8.8 % over the past month during a stock market rally on both sides of the Atlantic underpinned by growing hopes that major central banks have finished raising rates.



Financial Markets Performance:

*The USDIndex is to the upside for a 5th day, retesting the 104 level, as it found relative firmness as the markets priced in a more aggressive easing stance from the ECB than the Fed.
*EURUSD below 1.08, extending its 1-week dip, post a sharp correction in German manufacturing orders that added to concerns that growth is faltering. This is coupled with weaker than expected inflation data for November that will add to pressure on the ECB ahead of next week’s council meeting.
*Gold & Oil: The strength in the US Dollar weighed on commodities with USOIL dropping -0.88% to $72.10 and Gold falling -0.48% lower to $2009.97. Profit taking has knocked bullion from the record high of $2072.22 on December 1.
*Bitcoin hit 2022 highs at 44429. Currently it is traded at 43395 in an overbought condition, indicating a near term consolidation.



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.

[HFblogNews]

Date: 7th December 2023.

Oil Hits Lowest Levels Since June 2023, Moody Downward China.

Crude Oil – Oil Declines for a Seventh Consecutive Week

The price of Crude Oil has declined to its lowest level since June 2023, marking an almost six-month low. The price of Oil has now declined for a seventh consecutive week. Economists note the decline is also improving the prospects of the stock market. Stocks are taking advantage of the lower oil prices which may trigger lower inflation and a softer monetary policy. This week alone the price has declined by 6.5%, but what is driving the bearish trend?

The main two reasons the market is witnessing a lack of demand in the oil market is China’s latest poor economic data and the latest OPEC meeting. China’s manufacturing and services PMI read significantly lower than expectations and this week Japan also announced weaker data. China is the largest importer of Oil while Japan is the fourth largest. Therefore, poor economic data in these regions are likely to trigger downward pressure for Crude Oil.

To make matters worse for the Oil market, Moody, the credit rating industry, lowered the economic outlook for China from “stable” to “negative”. Since the downgrade, economists have advised the Chinese economy is not likely to witness a recession, but more likely stagnation. OPEC, on the other hand, were unable to come to an agreement on the production levels. Again, this had a negative effect on Crude Oil prices. Lastly, yesterday’s report from the American Petroleum Institute showed inventories rose by 9.594M barrels instead of a decline of 2.267M barrels. The inventories show higher than expected supply.



In terms of technical analysis, the price of Oil is trading within a downward trend and is currently hovering within a retracement. The retracement is currently measuring 1% in line with previous pullbacks and is currently showing no major upward momentum. Therefore, most indicators continue to signal a downward trend. If the price breaks below $69.69 and $69.59, sell signals will again potentially become active.

USA100 – Only 20% of Stocks Held onto Gains!

The USA100 fell by 0.57% during yesterday’s session and was the weakest of the top 3 most popular US indices. When looking at the NASADAQ’s top ten most influential stocks, only 1 stock stayed in the “green”, this was Tesla which only slightly rose by 0.27%. Out of the top 20 most influential stocks, only 20% retained their value. The stock which saw the largest decline was NVIDIA which dropped 2.28%.

However, fundamental factors continue to point towards a positive outlook for the US tech sector. This morning the US Dollar Index is declining, 52% of market participants believe the Fed will cut rates in March 2024 and most of the components witnessed positive earnings data. The only slight concern for investors is bond yields which have risen over the past 24 hours. However, bond yields continue to remain significantly lower than in the previous months, which is positive for the stock market.



Technical analysts have pointed out that the index is not within a short-term downward trend and each time the USA100 declines, buyers re-enter the following day to take advantage of the lower price. Investors will again be monitoring if the index rebounds today. The stronger performer in the pre-market hours is Alphabet which has risen 0.82%. Alphabet stocks make up almost 6% of the overall index. Investors are currently balancing the negative effect of a weaker Chinese economy and the positive effect of a rate cut as early as March 2024. If the price increases above $15,873, the USA100 will again experience buy signals. Buy signals can be seen from the regression channel and crossovers.

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.

[HFblogNews]

Date: 8th December 2023.

Central Banks’ Divergent Paths: ECB Signals Caution, BoE Stays the Course


Trading Leveraged Products is risky

As the European Central Bank (ECB) and the Bank of England (BoE) gear up for their upcoming meetings, market participants eagerly await signals that will shape the economic landscape in 2024. While both banks are expected to maintain interest rates, their perspectives on future policy directions diverge.

This article explores the nuanced positions of the ECB and BoE, shedding light on their contrasting views on inflation, rate hikes, and the path forward.

ECB’s Shifting Stance:

The ECB meeting is poised to capture attention not for an anticipated rate adjustment but for the nuanced signals regarding the outlook for 2024. In the aftermath of November’s meeting, where a tightening bias persisted, recent developments, notably the unexpected drop in inflation, have prompted a shift in tone.

Market Trends

Isabel Schnabel’s Reuters Interview:

Executive Board member Isabel Schnabel’s recent Reuters interview marked a departure from previous sentiments. While she emphasized the need for caution, Schnabel hinted that the ECB is prepared to confirm that interest rates have peaked. Contrary to market optimism anticipating rate cuts as early as March, Schnabel underscored the central bank’s patience, emphasizing the necessity of further progress in underlying inflation.

Monetary Policy Transmission Confidence:

Despite concerns about a potential credit crunch, Schnabel expressed confidence in the effectiveness of monetary policy transmission. While acknowledging signs of labor market softening, she dismissed fears of a severe and prolonged recession, aligning with the ECB’s cautious stance. The central bank seems poised to confirm the unlikelihood of further rate hikes but remains hesitant to entertain the idea of rate cuts in the near term.



Financial Markets Performance:

ECB’s Path to Rate Cuts:
The timing of potential rate cuts in 2024 remains a pivotal question. Market expectations for an easing bias in March, paving the way for a second-quarter cut, appear optimistic. ECB President Lagarde, expected to be more vague on the topic, may find it challenging to temper easing expectations.

[b]PEPP Reinvestment Discussion:
The discussion around the future of the Pandemic Emergency Purchase Program (PEPP) reinvestments adds complexity. While some suggest an early end to re-investments as a prerequisite for rate cuts, details may not emerge until early 2024. Lagarde’s confirmation of a gradual reduction could set the stage for rate cuts in the second quarter.

EURUSD has been under pressure since the lower than anticipated inflation report last week and is currently struggling to hold the 1.08 mark. The Fed may be leading the way on rate cuts next year, but markets expect that the ECB won’t be far behind. The US economy may be better equipped to deal with the marked tightening of financing conditions that is increasingly hitting the real economy.

BoE’s Steady Outlook:
In contrast, the BoE’s upcoming announcement may lack the excitement of policy shifts. With no updated forecasts and data aligning with November’s assumptions, the focus turns to the hawks within the bank. Despite concerns voiced by some, including BoE’s Greene, about the risks of doing too little, Governor Bailey maintains a steadfast position against early rate cuts.



Bailey’s Commitment to Inflation Target:
Bailey’s emphasis on completing the journey to the 2% inflation target and the potential sluggishness of that process reinforces the BoE’s commitment to a “higher for longer” approach. Deputy Governor Ramsden underscores the need for sustained restrictive policy to combat inflation effectively, signaling a likelihood of the BoE remaining on hold through the first half of 2024.

As the ECB signals caution and the BoE maintains a steady course, the central banks’ divergent paths reveal nuanced approaches to economic challenges.

Investors will closely monitor the upcoming meetings for insights into future policies, with the timing of potential rate cuts and the fate of PEPP reinvestments hanging in the balance. The evolving economic landscape will undoubtedly shape the trajectory of monetary policies in the months to come.

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.

[HFblogNews]

Date 11th December 2023.

US Economy Remains Strong, But All Eyes on Tomorrow’s Inflation!


Trading Leveraged Products is risky

December has not failed to surprise investors with the US employment sector outperforming expectations and sending stocks soaring. Additionally, across the Pacific the World’s second largest economy also made public interesting inflation data which is in the spotlight just as much as the US NFP. Both Chinese Consumer and Producer inflation fell below expectations. Consumer prices declined at their fastest pace in more than 3 years. China is now witnessing deflation measuring -0.5% which has not been seen since the banking crisis if we exclude COVID-19.

Last week, Moody’s downgraded China’s credit rating. Moody’s advises the costs of supporting failing local governments, state-owned companies and controlling the property crisis would pressure the economy. But the question is, what does this mean for the US and US Indices?

USA100 – Inflation To Be The Next Price Driver

The USA100 rose during the US trading session by 0.40% on Friday and by the close of day was almost 0.50% higher. The first reaction to the Non-Farm-Payroll data was negative and the instrument fell 0.38% before buyers re-entered the market. During this morning’s Asian session, the index is trading 0.10% lower but is so far forming nothing more than a retracement. Let’s discuss what the employment data means for the index as well as weak Chinese inflation.

The NFP confirms the US has 199,000 more employed individuals compared to the previous month, which is 15,000 higher than expected. However, the main shocks came from the Average Hourly Earnings and the Unemployment Rate. The Unemployment Rate declined from 3.9% to 3.7% which is considerably low considering the restrictive monetary policy. The Hourly Earnings doubled from 0.2% to 0.4%. The employment data has both positives and negatives for the stock market. However, in the past 2 years, higher employment data has meant a poorer stock market, which was not the case on Friday.

The better-than-expected employment data indicates an imbalance within the employment sector which triggered higher wages. These factors can contribute to higher consumer demand, higher investor demand, and a better performing economy. All these factors are positive for the stock market in general. However, there is a negative side also. The positive data has lowered the possibility of a nearer interest rate cut. Previously, market participants predicted a “cut” to come as early as March, but the employment data again points to “higher for longer”. The CME FedWatch Tool now has virtually no possibility of a cut in December, January and February, and now indicates a “pivot” in May 2024.

The question is, is the USA100 overpriced considering the new reality? This is something which will become clearer during Wednesday evening’s Federal Reserve Rate Decision and Press Conference. If the Fed President, Jerome Powell, suddenly becomes more hawkish and pushes a pivot further in the future, stocks can correct. Technical analysts also advise the stock market may fall into a wider price range until further clarity from the Fed.



Technical analysis shows the USA100 trading within a short-term bullish trend, but also at a significant psychological price. The asset has failed to break above this level on the past four attempts as investors fear the asset is trading above its intrinsic price. Therefore, the USA100 will require a stronger price driver. This potentially could come from tomorrow’s Consumer Price Index (inflation rate). If the CPI reads lower than 3.1%, ideally 2.9% or lower, the index could experience another surge in investor demand. However, if inflation reads 3.1% or remains at 3.2%, investors may be discouraged.

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.

[HFblogNews]

Date 12th December 2023.

Global Stocks Rise Ahead of Today’s US Inflation Announcement!


Trading Leveraged Products is risky

The USA100 is increasing in value for a seventh consecutive week and continues to renew its highs for 2023! The USA100 is only 0.65% lower from fully regaining all of the “lost ground” from 2022. The asset saw a sharp decline after the Ukraine-Russia conflict and the largest rate hiking cycle seen since 2004. However, all eyes are on today’s US inflation and tomorrow’s Central Bank press conference. Therefore, analysts do not expect volatility to cool off any time soon!

USA100

From the 100 stocks in the USA100, only 11 ended the day lower, while 89 stocks were in the green throughout the day. Broadcom, which is the seventh most influential stock, witnessed the largest gain, increasing by 9.00%. Broadcom continues to be one of the best performing stocks due to the latest company earnings which beat expectations. Additionally, the stock is supported by the company advising revenue from AI would double to $8 billion in 2024. The board of directors also advised the growth in AI would counterbalance the current challenges in the semiconductor market.

However, even though the majority of stocks within the USA100 rose in value on Monday, the top five most influential stocks declined. This includes Apple, Microsoft, Alphabet, Amazon, and NVIDIA. Of these stocks, the stocks which saw the largest decline was NVIDIA, dropping 1.85%. However, investors should note that Asian and European stocks are higher this morning, which continues to point to positive investor sentiment towards the asset class.

Today’s price movement will largely depend on the US inflation data. On Monday, investors priced in a weaker than expected Consumer Price Index. This is most probably due to deflation in China and lower producer prices which can also influence global inflation. This is due to the nature of the Chinese economy. For the USA100 to potentially continue its upward trend to previous highs, the CPI will need to read 3.00%. However, to see a stronger trend, investors will need clarity that a rate cut is likely by March 2024. For such an outcome, market participants may need to see a sharper decline in inflation such as a decline from 3.2% to 2.9%.



USDCHF

The USDCHF is trading higher since the opening of the European session, but remains lower than the open price. The Dollar Index is trading 0.22% lower and bond yields are 0.044% lower, which indicates the USDCHF may also come under further pressure. However, the price of the Dollar will largely be determined by today’s consumer inflation. In addition to this, tomorrow’s producer inflation and the Fed’s press conference will also create volatility.



The US Federal Reserve meeting will take place on Wednesday, and now, analysts are almost confident that the current interest rate will remain at 5.50%. However, investors and market participants continue to price in an earlier “pivot”. The central bank may again point out the possibility of maintaining high borrowing costs for a long time. Experts have revised their forecasts regarding the timing of an interest rate cut and are predicting May 2024, although previously, most estimated easing would begin in the first quarter.

Representatives of the Swiss National Bank will be convening a meeting on Thursday, and traders expect interest rates to remain at 1.70%. The head of the SNB, Mr Jordan, may indicate abandoning further tightening of monetary conditions which may pressure the Swiss Franc.

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.

[HFblogNews]

Date 13th December 2023.

The UK Economy Unexpectedly Contracts! US Inflation Remains Stubborn.


Trading Leveraged Products is risky

The USA100 continues to be the best performing index, increasing by 0.90% and more than 50% in 2023 in total. The main price driver was the US inflation data which more or less read as per expectations. The US inflation rate has declined from 3.2% to 3.1% but the core inflation rate remains stubbornly high. Core Inflation has remained at 4.00% for a second consecutive month. According to analysts, inflation is not low enough to prompt a pivot in the first quarter of 2024. However, investors are increasing exposure to the stock market as a “soft landing” becomes more likely.

US30 Remains in the “Trend Zone” of Technical Analysis!

Even though the best-performing asset by far is the USA100, the asset experiencing the best performance in terms of components is the US30. The USA100 saw 68% of its stocks increase in value whereas 73% of the US30 appreciated. Investors should also note that of the top 20 influential assets within the US30, only 1 stock declined. Chevron fell by 1.28%, and the best performing stock was Salesforce, rising 1.73%. In comparison, of the top 20 influential stocks within the USA100, 5 stocks declined.

As mentioned above, inflation read as most analysts were expecting, however it did not show any real signs of easing significantly over the next 2-3 months. The Federal Reserve policy makers will be able to discuss monetary policy issues tonight at 18:00 GMT. Journalists will without doubt ask Chairman Jerome Powell if he believes interest rates will be cut in the first half of the year. Without a dovish tone or a clear indication of a cut, the stock market may struggle to maintain momentum. However, most buyers are now investing, not due to a dovish policy, but due to the resilient economy and the likelihood of a soft landing.

One of the few stocks within the Dow Jones which have struggled is Procter and Gamble (holds a weight of 2.64%). Analysts expect the company’s revenue and earnings per share to remain stable, but shareholders have taken badly to the company decision to withdraw from certain countries where the Dollar is now too expensive. For example, the products will be withdrawn from Nigeria and Argentina. Furthermore, Berkshire Hathaway has also advised they have recently sold their shares in the company. Warren Buffet explained that the consumer goods market is recovering too slowly after the pandemic.



In terms of Technical Analysis, the price of the US30 is forming a downward facing retracement but is not showing any signs of strong momentum. Due to the weak momentum, and also bullish impulse waves forming, the instrument continues to remain in bullish territory. The price also continues to trade within the upper side of the Bollinger Bands and Regression Channels, again indicating bullish price movement. However, some traders may be concerned about the high price. These individuals may wait for a lower price or a larger retracement before speculating an increase.

The price throughout the day will be influenced by the Producer Price Index, which looks at inflation at the producer level. If the PPI reads lower than expected (0.2%), the Dow Jones could obtain short-term support. However, the main event will be tonight’s Federal Reserve Press Conference.

GBPUSD – The UK Economy Unexpectedly Contracts!

The price of the GBPUSD came under pressure this morning from the UK’s latest Gross Domestic Product. The UK’s GDP was expected to decline from 0.2% to -0.1%. However, the figure fell to -0.3%, the lowest since September 2023, sparking some doubt as to whether the BoE can hold rates “higher for longer”.

November’s poor GDP figures will not be enough to worry the Bank of England, however, December and January’s GDP figure will now become more vital! If next month’s data also disappoints, investors may start to price in a weaker monetary policy.

The US Dollar Index this morning is slightly higher but has not crossed above yesterday’s highs. However, the Pound is declining against all its main competitors. If the US Producer Price Index reads higher than expected, the Dollar could receive some much-needed support. In this case, the GBPUSD may decline further and break below the support level at 1.25130. In terms of technical analysis, the GBPUSD is trading below the 75-bar exponential moving average and at 42.00% on the RSI. Both indicate sellers are controlling the price movement and a downward trend remains a possibility.



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.

[HFblogNews]

Date: 14th December 2023.

Fed Expect Interest Rates to Fall to 4.60% in 2024, Buyers Pounce!



*Fed Expects Interest Rates to Fall to 4.60% in 2024, Buyers Pounce!
*The Federal Reserve gives its first clear signal that rates will be cut in 2024!
*Analysts expect the Federal Fund Rate to decline to 4.50%.
*The USA100 is close to breaking its all-time highs after rising a further 1.65% since the Fed’s rate decision.
*The Dollar declined to a 19-week low against the Japanese Yen.

USA100 Close to Reaching All-Time Highs!

The USA100 rose in value for a sixth consecutive day and if the volatility levels continue, the asset will be on track to complete its strongest week of the year. Investors heavily exposed their portfolios to the US stock market and particularly the tech sector. Investors show a clear “risk-on” appetite which can also be seen in bond yields which again collapsed. In addition to this, other safe haven assets, such as the Dollar, fell a whole 1%. The cheaper Dollar and lower bond yields are likely to support the US stock market if they follow the market’s traditional “domino effect”.

The Fed President speech made it clear that the monetary policy will be set to ensure employment remains high and that prices remain stable. The president stressed the importance of keeping inflation stable and not necessarily applying further downward pressure. The press conference reassured many investors and improved investor sentiment. The Federal Open Market Committee’s new forecast points to interest rates declining to 4.60% in 2024, 3.60% in 2025 and 2.90% in 2026. As a result, the cost of debt will decline and consumer demand may rise, supporting companies within the USA100.

In addition to the Fed’s forward guidance, the latest Producer Price Index is also supporting stocks. Producer inflation read 0.00%, which is lower than the previous 0.2% expectation. As a result, investors continue to predict that inflation will remain controlled and potentially decline further in the next 2 months. For inflation to remain stable, investors will also be monitoring oil prices aiming for crude oil to mainly trade below $70 per barrel.



In terms of technical analysis, the price of the USA100 remains within the bullish trend zone of the regression channel. In addition to this, the price trades above the price sentiment line and the trend-based moving average. For this reason, technical analysis indicates an upward trend going forward similar to fundamental analysis. However, most Oscillators indicate the price is “overbought”. Therefore, it is important to consider the appropriate price to speculate the upward price movement.

Lastly, the monetary policy of the Swiss National Bank, European Central Bank and Bank of England will influence the USA100. Buyers and bulls will ideally be hoping for a similar dovish tone. In addition to this, investors will be hoping for higher-than-expected US Retail Sales.

USDJPY – Japanese Yen Takes Advantage of Dollar Weakness

Investors looking to avoid “news risk” may look to the Japanese Yen which is not expecting any major news during this morning’s European and Asian session. The Japanese Yen is increasing in value against all major currencies including the US Dollar, Euro and Pound during this morning’s session. The exchange rate has also declined for three consecutive days and the Dollar Index is trading 0.19% lower this morning.

This week, Japan has released various data regarding the economy and confidence which have read stronger than expected. Thus, the confidence of national business has almost reached two-year highs, which, according to experts, confirms the stability of the country’s economy in the context of the global crisis and gives the regulator grounds to reduce incentives and move to a tighter monetary policy.

The USDJPY is not oversold, similar to other currency pairs, which still gives an opportunity for traders to speculate. Sell signals are likely to arise from technical analysis if the price declines below 141.285.



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.

[HFblogNews]

Date: 18th December 2023.

Market Recap: Focal BoJ ahead & the very last key US data



Markets are starting to wind down for the year. The four major central bank, the FOMC, ECB, BoE, and SNB all left policy rates unchanged, and most dialed back their hawkish biases. But while officials tried to jawbone and push back that early rate cuts are not on the table, the markets quickly equated the steady stance and shift in bias to pricing in rate cuts sooner than later. Indeed the markets ran with expectations for easing as soon as the first half of the year, if not March for the FOMC.

Economic Indicators & Central Banks:

*FED: Fed’s Bostic sees two 25 bp cuts in 2024, but said it’s not an “imminent thing,” in a Reuters interview. New York Fed President Williams said its too early to begin thinking about cuts. Still, U.S. futures are already finding buyers again after a mixed close on Wall Street Friday.
*Japan: The BoJ is the focal point this week as it’s the last major bank to meet. Risks for no action have picked up as data have failed to give Governor Ueda the confidence needed to exit negative rates or YCC at this point.
*China’s PBOC resumes 14-day cash injections. The move likely designed to smooth liquidity conditions over the year-end. Borrowing costs were held unchanged at 1.8% and 1.95% respectively.



Market Trends:

*Treasury yields slightly higher however the 2-year still closed the week with 28 bp drop, marking the lowest closing since mid-May. The 10-year notes stood at 3.91%.
*Asian stock markets declined, and European futures are also in the red, after Fed comments on Friday tried to push back against excessive rate cut speculation.
*Stocks: The JPN225 slumped 0.7% on weakness in Yen. The US500 futures inched up 0.3%, while US100 added 0.2%, EU50 futures slipped 0.3% and UK100 at 0.1%.

Financial Markets Performance:

*The USDIndex at 102.00 after drifting to 101.43.
*EURUSD corrected to 1.0920 after a solid weekly gain If Eurozone activity fails to stabilize, Lagarde will be under pressure to change her tune and prepare for rate cuts earlier rather than later.
*GBPUSD moves sideways today and is at 1.2685, while USDJPY corrected again and is trading at 142.55 (38.2% Fib from 2023 upleg).
*Gold turned above $2000 as drop in the US dollar, yields and the Fed’s dovish pivot have helped to boost demand for the precious metal.
*Oil steadied above $72 after 5-month low last week amid worries supply will continue to outstrip demand. The weaker USD and dovish Fed comments helped to boost sentiment. The IEA said in its monthly report that it expects global oil consumption to rise by 1.1 million barrels a day in 2024, which means it has revised its demand forecast higher. That added further support and helped oil prices to at least stabilize over the second half of this week. Lower exports from Russia and attacks by the Houthis on ships in the Red Sea offered some support as well.
*Bitcoin holds above 40K for 11 day’s in a row, with increasing bullish bias.
*Key Mover: Goldman has raised year-end 2024 S&P 500 index target from 4700 to 5100, representing 8% upside from the current level. Decelerating inflation and Fed easing will keep real yields low and support a P/E multiple >19x.



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.

[HFblogNews]

Date: 3rd January 2024.

Market Recap: Stocks, Bonds open 2024 in the red!



Economic Indicators & Central Banks:

*Data in the US included stronger than expected construction spending and weaker than forecast S&P Global manufacturing PMI.
*Fed funds futures have slipped to kick off 2024 as some of the aggressive rate cut bets are trimmed. However, the market is still pricing in close to 6 quarter point cuts. No action is expected for the first FOMC meeting on January 31.



Market Trends:

*Treasuries and Wall Street opened 2024 in the red and it basically went downhill from there. Treasury yields climbed 5- to 8- bps, led by the front end.
*A heavy corporate calendar exacerbated the losses from spillover from losses in European bonds, profit taking on the late 2023 rally, and from trimming of Fed rate cut bets.
*Stocks: The US100 dropped -1.63% paring some losses as the indexes finished off their lows. The US500 was -0.57% in the red, while the US30 was fractionally higher.
*Moderna shares surged 15.5% after investment bank Oppenheimer upgraded its stock.
*Apple lost 3.6%, its worst day in 5 months after Barclays downgraded its shares, Nvidia and Meta Platforms both fell more than 2%. Lack of new features and Iphone upgrades affected Apple stocks.

Financial Markets Performance:

*The USDIndexretested 102. The buck is on course for a 3rd straight daily rise, with technical factors as well as risk aversion likely to add support.
*EURUSD has dropped sharply to 1.0937 and GBPUSD dropped to 1.2610. USDJPY nudged up to 142.43 in thin trade, as Japanese markets remain closed.
*Gold declined to $2058 from the $2062.98 close on December 29. Global risks and the weaker US Dollar supported gold prices into year-end and an all-time closing high of $2077.49 on December 27.
*Bitcoin extended above 45K supported by statements that Blackrock & JPMorgan anticipate an imminent spot Bitcoin ETF approval and Goldman Sachs issuing huge 2024 Crypto Prediction.
*Today: Germany unemployment, US FOMC minutes, ISM Manufacturing and US Job openings.
*Key Mover: Oil prices slumped to $70.30 after an intraday peak of $73.64 amid concerns over events on the Red Sea. The escalating tensions in the Middle East are fueling concern that supply may be disrupted.



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.

[HFblogNews]

Date: 4th January 2024.

Market Recap:Sentiment stable for now.



Economic Indicators & Central Banks:

*The Fed’s minutes to the December 12-13 meeting showed some pushback against imminent easing, while still acknowledging the rate cuts penciled in with the dots. The report showed “all” participants said clear progress had been made toward the inflation goal. Rates had likely peaked.
*“Several” thought the policy rate could remain restrictive for some time and peak rates could last longer than expected. Fed’s Barkin said there is still potential for additional rate hikes.
*China services index posted fastest expansion in 5 months amid optimism. Chinese wages in major cities declined by the most on record.
*Japanese manufacturing activity shrank by the most in 10 months in December, as demand ebbed in Asia’s largest advanced economy.



Market Trends:

*Wall Street extended its 2024 declines with weakness in tech shares weighing. The US100 (NASDAQ) slumped -1.18%, dropping for a 4th straight session, with the US500 (S&P500) falling -0.80%, while the US30 (DOW) was off -0.76%.
*JPN225 (Nikkei) dropped the most in two weeks, after the Fed minutes, also due to the powerful earthquake in the northwest on New Year’s Day and the runway collision between turboprop aircraft and Japan Airlines jet, which dragged down some companies.
*ASX fell 0.53% to trade near 7,495. Hopes that the RBA will no longer be raising rates have been partly driven by the Fed’s dovish shift.
*Chinese stocks remained the biggest drag in Asia following the jobs report – CSI 300 down by 0.9% after having slid as much as 1.6%.

Financial Markets Performance:

*The USDIndex rallied from a session low of 102.07 to a peak of 102.40 before dipping to 102. Markets reassessed their expectations of the scale of rate cuts by the Fed this year.
*USDJPY regained ground up to 143.89 as the Japan market reopened.
*Gold slid to $2030 per ounce, in part hurt by the FOMC minutes, with the firmer US Dollar weighing too.
*Bitcoin steadied above 42500 after diving to 40K territory as $400M was liquidated in 2 hours, as Matrixport rebuffed optimistic reports!
*Key Mover: Crude oil perked up and climbed 3.65% to $72.95 per barrel as a shutdown at a Libyan oil field added to the concerns over Mid East tensions and supply. Currently traded above $73. Libya’s major Sharara oilfield, with a capacity of 300,000 bpd, completely shuts down due to protests.



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.