Hotforex.com - Market Analysis and News.

[HFblogNews]

Date : 11th February 2022.

Market Update – February 11 – USD on bid as equities crushed.


Trading Leveraged Products is risky

The markets were crushed, and especially bonds, as a hotter than expected CPI and hawkish comments from Bullard weighed heavily on the markets. The 7.5% y/y pace of CPI, a 40-year high, boosted concerns that the FOMC will have to take a more aggressive stance on rate hikes and tightening down the road. But the nail in the coffin were comments from the Fed hawk Bullard who said he now advocated for a half point rate increase in March and 100 bps of tightening over the first half of the year. The UK economy grew by 7.5% last year despite Omicron causing slowdown. Treasury yields soared with the 10-year cheapening through the 2.0% level for the first time since July 31, 2019. Wall Street was hammered too and the major indexes plunged on the day.

* USD (USDIndex rallied to 96.00).
* US Yields sharply higher, spiked further, leaving the 2-year rate up 25 bps to 1.579% – biggest single daily move since June 2009 and the great financial crash. The 10-year was up 10 bps at 2.029%, closing with a 2% handle for the first time since July 31, 2019.
* Equities were led by the -2.10% drop in the USA100, while the USA500 was -1.81% lower, with the USA30 down -1.47%. Tech stocks have been hit by the prospect of accelerated Fed hikes and GER30 and UK100 are currently down -1.3% and -1.0%.
* Earnings: Affirm stock dropped 21%. Twitter unchanged, as Twitter’s mixed fourth quarter shows its challenges ahead, PepsiCo down by 2.1%, beat earnings but warns on costs while full-year outlook fell short. Disney 3.50% up, shows rebound in Disney+ & Parks businesses.
* USOil – at $88.00 following a spike at 90.60.
* Gold – down to $1820.90.
* Bitcoin settled to $43,000 – 44,000 area.
* FX markets – USD on bid as yields spiked and USDJPY jumped to 116.32, although the Yen strengthened against most other currencies as risk appetite waned. AUD and NZD drifted. EURUSD declined to 1.1370 & Cable down to 1.3512.

European Open – The March 10-year Bund future is down -23 ticks, but the 30-year future has rallied and US futures have found a footing. So there are some signs of stabilisation at least at the long end. EGBs sold off yesterday in the wake of the higher than expected inflation print, and while the UK curve shifted higher across the board, thanks to Lane’s dovish comments on the policy outlook, the short end outperformed in the Eurozone and the curve steepened as the long end sold off, with Italian BTPs once again hit most.

Today – Today’s calendar is light, with just the preliminary University of Michigan consumer sentiment index due. Today’s earnings calendar features reports from Enbridge, Dominion Energy, Magna International, and Fortis.



Biggest FX Mover @ (07:30 GMT) AUDUSD (-0.58%) – Dipped to 0.7110 on USD strength. Fast MAs currently flat, as MACD signal line & histogram extend southwards and RSI at 36, indicating near term consolidation and overall pressure.

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 HotForex 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
HotForex

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 February 2022.

Market Update – February 14 – Geopolitical tensions top of the agenda.


Trading Leveraged Products is risky

Stock markets crushed into close Friday (NASDAQ -2.78%), Asia lower too (Nikkei -2.2%) and European FUTS down -1.92%. Oil at new 7-yr high, Yields & Gold cool a tad, USD & JPY bid, NZD clobbered. Key FED hawk Bullard called for 1% hike over next 3 meetings, 72% chance of 50bps in March on Friday cooled to 38% today. Daly – danger of moving too fast. Ukraine asks for meeting with Russia within 48hrs, Biden: Russia possible fake invasion pretext as early as Tuesday/Wednesday, most foreign nationals advised to leave, – a possibly pivotal week ahead.

Economic Week Ahead – Closed FED meet today – possible move on discount rate, (the rate the FED lends to banks) but not the main Fed Funds rate (the rate banks lend to each other). Top of the week – FED Minutes (Wednesday) supported by more global inflation and Retail Sales data.

* USD (USDIndex 96.05) stronger USD weaker EUR on unrest on its border and possible energy shortages.
* US Yields 10-yr closed Friday at 1.955 down from over 2.0%, trades at 1.94%.
* Equities – USA500 -85pts (-1.9%) 4418 -(TSLA -4.93%, APPL -2%, GOOG -3.23%, XOM+2.52%. US500 FUTs now 4416
* USOil – Futures spiked over 3.6% to $93.10 and trades at $92.40 now.
* Gold – Futures spiked 1.97% to $1862 back to $1854 now.
* Bitcoin remains in the $45,000 to $42,000 range.
* FX markets – EURUSD down to 1.1345 USDJPY down to 115.35 & Cable to 1.3535.

Overnight – NZD inflation much firmer than expected (+2.7% vs 0.6%), Business outlook weaker, CHF PPI 3 x higher than expected.

European Open – The March 10-year Bund future has rallied 99 ticks, with yields set to slide at the open as European bourses prepare for a decisive week over the Ukraine conflict with Russia. Treasuries are underperforming and the US 10-year rate has already backed up 2.1 bp this morning, suggesting that the likely rally in bonds may not last too long. The same delayed reaction is likely in stocks. ECB head Lagarde is set to speak in the afternoon and will likely to continue to try and balance the need to acknowledge inflation risks, with a cautious tone, designed to keep markets from running away with the tightening story.

Today – Closed Board Meeting, Fed’s Bullard, ECB’s Lagarde, German-Ukrainian meeting. Earnings Michelin, AvisBudget Group.



Biggest FX Mover @ (07:30 GMT) AUDUSD (-0.58%) – Dipped to 0.7110 on USD strength. Fast MAs currently flat, as MACD signal line & histogram extend southwards and RSI at 36, indicating near term consolidation and overall pressure.

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 HotForex 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
HotForex

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 : 15th February 2022.

Market Update – February 15 – Markets Await the Diplomats.


Trading Leveraged Products is risky

Stock markets ended flat into close, with Ukraine jitters easing a tad. USD & JPY remained bid, Gold has hit an 8-month high and Oil holds at $93.00. 2yr-10yr Yields at their narrowest since Feb 2019 but have cooled overnight. No leaks from closed door FED meeting, Bullard reemphasized his 100bps by July. Asia stocks lower too. Ukraine had no response from Russia although Lavrov & Putin agreed to more diplomacy with the West. Scholz in Moscow today. UK Foreign Sec, Truss “Invasion highly likely but not inevitable”. Iron Ore futures slumped over 10% amid the continued crackdown on prices by China hitting AUD.

* USD (USDIndex 96.15) stronger USD weaker EUR on unrest on its border and possible energy shortages.
* US Yields 10-yr closed Friday at 1.996 cooled to 1.97%, 2-yrs remain elevated.
* Equities – USA500 -16pts (-0.39%) 4401 -(TSLA +1.83%) Musk gave $5.7bln shares to a charity in Nov. US500 FUTS now 4396.
* USOil – Futures spiked to $93.80, trades at $92.70 now.
* Gold – Rallied (8-mth highs) to $1879 back to $1878 now.
* Bitcoin remains in the $45,000 to $42,000 range.
* FX markets – EURUSD down to 1.1324 USDJPY down to 115.29 & Cable to 1.3540.

Overnight- AUD RBA Mins, no surprises, analysts bring forward rate hikes to possibly August form year end. JPY GDP missed (1.3% vs 1.5% & previous quarter revised lower to -0.9%), GBP Earnings beat at 4.3% vs 3.8%, but inflation impacted real wages -0.8%. Tightening labour market too. – Unemployment steady at 4.1%.

European Open – The 10-year Bund future is up 68 ticks, outperforming versus Treasury futures, which are also slightly higher though. Markets are now increasingly worried that the Fed will act too aggressively on rates and stifle the recovery in the process. ECB’s Lagarde yesterday was eager to keep rate hike speculation at bay and even if the ECB pivots, a rate hike before the last quarter of the year, doesn’t really seem to be on the cards. Ukraine jitters have eased somewhat, but continue to cloud over sentiment and DAX and FTSE 100 futures are down -0.3% and -0.2% respectively.

Today – EZ GDP, German ZEW, US Empire State Manu. PPI Final Demand, German-Russian meeting, Earnings Glencore, Restaurant Brands, ViacomCBS.



Biggest FX Mover @ (07:30 GMT) AUDJPY (-0.36%) From 84.00 highs on Thursday to 81.50 yesterday & back to 82.00 now. MAs aligned lower, MACD signal line & histogram remains below 0 line, RSI 43.50, H1 ATR 0.185 Daily ATR 0.878.

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 HotForex 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
HotForex

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 : 16th February 2022.

Market Update – February 16 – Back from the brink?


Trading Leveraged Products is risky

Stock markets rallied into close (2.5%-1.5%), with news of withdrawal of some Russian troops from close to the Ukrainian border. USD & JPY cool, Gold cooled too from 8-month highs and Oil dipped to $90.00. 2yr-10yr Yields widened but both remain elevated as it becomes clear that the situation in Ukraine is far from resolved. Asian markets rallied (Nikkei +2.2%) but have cooled into close. Biden – “Human cost of Russia attack would be immense”.

* USD (USDIndex 95.85) cools from Monday high at 96.40.
* US Yields 10-yr closed back over 2.00% at 2.045 trades at 1.997%, 2-yrs remain elevated.
* Equities – USA500 +69 pts (+1.58%) 4471 -(NVDA +9.18%, ABNB+6.14%, TSLA +5.33%) US500 FUTS cooler now at 4457.
* USOil – Futures dipped to $89.00, trades at $90.70 now.
* Gold – Fell from (8-mth highs) at $1879 back to $1845 and $1855 now.
* Bitcoin remains in the $45,000 to $42,000 range.
* FX markets – EURUSD up to 1.1375 USDJPY up to 115.64 & Cable to 1.3555.

Overnight- AUD RBA Mins, no surprises, analysts bring forward rate hikes to possibly August form year end. JPY GDP missed (1.3% vs 1.5% & previous quarter revised lower to -0.9%), GBP Earnings beat at 4.3% vs 3.8%, but inflation impacted real wages -0.8%. Tightening labour market too. – Unemployment steady at 4.1%.

European Open – CNY Inflation slips, CPI down to 0.9% (expectations were 1.0%) from 1.5% and PPI down from record 10.3% to 9.1% (9.5% expected). UK Inflation hotter than expected CPI 5.5% vs 5.4%, CORE at 4.4% vs 4.3% – it’s only a tick but its above expectations, details may show some better news, but Oil & Petrol prices still rising and strong wage inflation yesterday too. BoE still see inflation topping in April, but will add pressure for BoE to act again. – Old fashioned RPI now at 7.8% vs 7.4% too.

Today – CAD CPI; EZ Industrial Production, US Retail Sales, FOMC Minutes, Earnings Heineken, Carrefour; Barrick Gold, Garmin, Shopify, NVIDIA.



Biggest FX Mover @ (07:30 GMT) AUDJPY (+0.33%) The key Risk sensitive pair recovers from 81.50 lows Monday back to 83.00 now. MAs aligned higher, MACD signal line & histogram significantly above 0 line, RSI 66.25 & rising, H1 ATR 0.115 Daily ATR 0.818.

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 HotForex 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.

Stuart Cowell
Head Market Analyst
HotForex

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 : 17th February 2022.

Market Update – February 17 – Risks raised – Russia reports being fired on.


Trading Leveraged Products is risky

US Stock markets flat into close (US500 +3 pts) after a weak day, no surprises in FED minutes (Jan 25/26) no talk of 50bps rate rises but a lot has happened in 3 weeks. USD & JPY bid on more jitters regarding Ukraine. Gold rallied back to $1875, Oil – very volatile after inventories, contract expiry & news from Iran. Yields widened again but remain elevated. Asian markets also slipped Nikkei (-0.83%) but have cooled into close. US & UK – “Russian troop withdrawal claims “false”. Ukraine denies any missiles from Donbass were fired.

* USD (USDIndex 95.85) cools from spike to 96.00 earlier.
* US Yields 10-yr closed 2.045 trades at down now 1.998%, 2-yrs remain elevated.
* Equities – USA500 +3.94 pts (+1.58%) 4475 -(NVDA beat,) FB -2.02% US500 FUTS cooler now at 4455.
* USOil – Topped at $93.00, after inventories, collapsed to $88.00 after contract expiry and positive nuclear deal headlines from both the US and Iran. Trades at $90.80 now.
* Gold – Rallied $1850 support to $1875 now.
* Bitcoin remains in the $45,000 to $42,000 range.
* FX markets – EURUSD down to 1.1364 USDJPY down to 115.25 & Cable to 1.3585, from a test of 1.3600 after hot inflation yesterday.

Overnight- JPY machinery orders much better than expected, Trade balance slipped significantly. AUD Job creation better than expected and Unemployment steady at -4.2%.

European Open – The March 10-year Bund future is up 32 ticks, U.S. futures are also moving higher. Investors are keeping a weary eye on central banks, which are trapped between fears of out of control inflation and concern that hasty and aggressive central bank action could hit the recovery. DAX and FTSE 100 futures are down -0.75 and -0.4% respectively.

Today – US Initial Claims, CBRT Policy Announcement, ECB’s Lane, Schnabel, de Cos, Fed’s Bullard & Mester Earnings Standard Chartered (beat); Airbus (beat), Orange, Commerzbank, Walmart



Biggest FX Mover @ (07:30 GMT) NZDCAD (+0.43%) Rallied from lows of 0.8400 yesterday to 0.8510 now. MAs aligned higher, MACD signal line & histogram significantly above 0 line, RSI 68.25 & rising, H1 ATR 0.0015 Daily ATR 0.0060.

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 HotForex 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.

Stuart Cowell
Head Market Analyst
HotForex

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 February 2022.

Market Update – February 18 – Ukraine worries front & centre.


Trading Leveraged Products is risky

US Stock markets crashed into close (US30 -622pts) after a weak day. US data biased lower (Philly Fed 16.0 vs 23.2, Initial Claims 248K vs 217k & Housing data mixed.) USD cools on its safe-haven bid. Gold rallied to test $1900, Oil remained under $90.00, Yields widened again but remain elevated. Asian markets also slipped (Nikkei -0.43%, ASX worst performer -1.0%.) Claims & counterclaims yesterday over who fired on who, Russia expelled a US diplomat and today there are reports of 30 more troop and tank withdrawals; also “provided there is no further Russian invasion of Ukraine,” Blinken & Lavrov will meet late next week.



* USD (USDIndex 95.75) consolidating in range; Wednesday’s & last Friday’s low 95.65.
*US Yields 10-yr cooled into closed 1.97% and trades lower today, 2-yr remains elevated.
*Equities – USA500 -95 pts (-2.12%) 4380 – (NVDA -7.56%, FB -4.02% TSLA -5.0%, WMT + 4.01% (Big Earnings beat & Divi increase)- US500 FUTS recover to 4396, currently.
*USOil – Topped at $91.00, back to under $90.00 now and trades at $89.20 now. Wednesdays & last Friday’s low 88.00.
*Gold – Rallied through psychological $1900 earlier to test 2021 highs, now back to $1892
*Bitcoin broke out of the $42k-45K range and trades down to test $40K.
*FX markets – EURUSD pivoting around 1.1365, USDJPY broke below 115.00 to new 10-day low at 114.78 back to 115.10 now. Cable breaches 1.3600 and trades at 1.3625.

Overnight- JPY hurt by weaker CPI data (0.2% vs 0.3% & 0.5% previously). Fed hawk Mester says rates should rise more quickly and the balance sheet needs to be reduced more swiftly than it did post the financial crash. Nothing new but more hawkish overtones and pressure to act. UK Retail Sales stronger than anticipated, 1.9% vs 1.1% but December numbers were revised down to -4.0% from -3.7%. Poor christmas for UK retailers. French CPI in-line and unchanged at 0.3%.

European Open – The March 10-year Bund future is down -13 ticks, US futures are also lower, but outperforming, with reports of a planned US-Russia meeting helping to boost confidence and boosting stock market sentiment. Safe haven demand is ebbing and DAX and FTSE 100 futures are up 0.3%, while a 0.7% rise in the NASDAQ is leading US futures higher. Not that Ukraine jitters are resolved and markets will keep a weary eye on developments. For now though they seem willing to buy into the headlines, which will likely see yields nudging higher early in the session. EGBs have staged a remarkable rally this week, as officials pledged caution and gradualism as they prepare to remove stimulus.

Today – US Existing Home Sales, EZ Consumer Confidence, Fed’s Williams, Brainard, Evans; ECB’s Elderson, Panetta. Earnings NatWest; Allianz, EDF, Deere.



Biggest FX Mover @ (07:30 GMT) NZDJPY (+0.58%) Rallied from lows of 75.86 on Monday to 0.77.35 now. MAs aligned higher, MACD signal line & histogram significantly above 0 line, RSI 63.25 & rising, Stochs OB zone H1 ATR 0.123 Daily ATR 0.755.

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 HotForex 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.

Stuart Cowell
Head Market Analyst
HotForex

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 : 21st February 2022.

UK: Data adding to arguments for swift action.



The markets are closed today for Presidents’ Day. Canada is also closed. Bonds held a haven bid Friday as the threat of a war in the Ukraine intensified.

Bond yields have moved higher on strong data and headlines of a possible Biden-Putin summit, but doubts have already started to emerge, leaving 10-year rates off earlier highs and GER30 and UK100 up 0.3% and down -0.1% respectively. The 10-year Bund yield is up 1.9 bp at 0.21%, the Gilt rate up 1.7 bp at 1.39%. PMI reports for the Eurozone and the UK highlighted a strong and swift rebound from Omicron, but also rising price pressures and in the UK wage increases and staff shortages.

UK Composite Output PMI at 8-months high in February. The overall reading rose to 60.2 from 54.2 in January, thanks to a huge improvement in services sector activity. The services PMI came in at 60.8, up from 54.1 in the previous month, but while the manufacturing output index jumped to a 7 month high of 56.7, the manufacturing PMI held steady at 57.3 Coupled with German PPI inflation rising to a whopping 25%, the data added to arguments for swift action from both the BoE and the ECB.

There were source stories last week effectively confirming that the ECB is likely to end net asset purchases in September and pave the way for a rate hike in the last quarter of the year. At the BoE there were already a number of people arguing in favour of a 50 bp move at the last meeting, and the data clearly suggests that additional steps will be necessary to keep inflation from taking to firm a hold.

That UK inflation failed to drop back as expected at the start of the year and the squeeze in the cost of living is increasingly getting popular attention. The RPI that officials wanted to drop altogether is back in focus and hit a whopping 7.8% in January. Coupled with tax hikes, the pressure on households is increasing, especially as there is little consumers can do in the middle of the winter to escape the jump in energy costs. Against the background of a tightening labour market, pressure on the BoE is building, although the top brass at the central bank is likely to continue to argue in favour of gradual moves.

The stats office’s preferred target is the CPIH, which stood at 4.9% y/y in January, up from 4.8% in the previous month. The measures dominate the official press release, but remains little used in real life. The narrower CPI hit a 30 year high of 5.5% at the start of the year, the core reading lifted to 4.4% from 4.2% and the Retail Price Index (RPI) which was the main and indeed only measure until 2011, jumped to 7.8%. Energy prices remain the main driving factor and with the government set to lift the price cap on energy in April, the chances are that more is to come, with even the BoE suggesting that CPI could hit 7% in April.



For consumers the multitude of inflation measures is confusing and the older RPI remains firmly lodged in the minds of many. Indeed, union negotiators continue to consider it the best available measure of inflation. That means the 7.8% measure, rather than the much lower CPIH will be the focus in official wage negotiations. Unions may no longer be as powerful as they once were, but given that across the UK the labour market looks increasingly tight with many companies struggling to find skilled staff, they will certainly be in a good negotiating position this year. Reports suggest that pay bargaining across major private and public sector employers was relatively low through much of last year, likely also owing to the crisis situation. With the recovery expected to continue this year and unions focusing on the much higher RPI reading, wage talks are likely to be much tougher this year.

Indeed, there are already reports that companies are forced to up wages just to keep staff and latest labour market data not just confirmed that jobless claims continue to decline, but also reported an unexpected rise in average weekly earnings growth.

But with demand coming back companies are also more likely to pass on the sharp increase in cost pressures. If the jump in energy prices were not enough, the FT warned that beer prices are also set to rise sharply, with prices of malting barley nearly doubling last year. Long term supply contracts mean higher costs are only now being passed on to consumers. With struggling consumers told to wrap up warm and use hot water bottles to keep a lid on energy prices and a rise in beer prices underway, BoE Bailey’s calls for wage restraint didn’t go down well.



Indeed, more than anything communication will be key as central banks navigate a very difficult situation. Bailey may have been clumsy in his remarks, but he and his chief economist Pill clearly are aware that cautious moves are required in order not to stifle growth as the economy navigates the recovery from the pandemic. The two were among those arguing against a large 50 bp move at the last meeting.

Indeed, delivering not just successive, but unusually aggressive rate hikes at this point would likely see markets running too far ahead with the tightening story, which could see a jump in rates that in turn could weigh on the recovery.

The BoE’s monetary policy report already suggested that markets are too pessimistic on the medium term outlook and if the bank were to deliver a 50 bp hike in March, while inflation rates continue to rise, markets would very likely be pushing for even more with the next pick up in headline inflation. Measured action then will likely remain the order of the day for now, especially as easing supply chain pressures should also help to limit the rise in cost pressures going forward.

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 HotForex 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
HotForex

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 : 22nd February 2022.

Market Update – February 22 – RISK OFF – Stocks Dive, Treasuries Up, Oil Leaps.


Trading Leveraged Products is risky

Stocks have collapsed as Treasuries rally and a major rally in Oil and Gold as President Putin recognizes the breakaway regions of Ukraine and orders troops into the country. The West prepares more sanctions, with USD and JPY bid. NZD also holds Friday’s bid ahead of RBNZ. Gold rallied to test $1914, Oil rallied up 3.4%. Yields fell to 1.858 from 1.91 from Friday’s close. Asian markets sank (Nikkei -1.7%, Hang Seng worst performer -3.2%). VIX futures trade -5.7%, EuroStoxx FUTS -3.44%.



* USD up(USDIndex 96.11). USD on bid next resistance 96.30 from 14/2.
* US Yields 10-yr tanked from 1.932 close Friday to 1.91% now to test 1.90.
* Equities – USA500 -32 pts (-0.72%) 4348 on Friday. US500 FUTS collapsed (-2.0%) to 4230 earlier, back to 4285 now.
* USOil – Topped at $94.00, back to under $92.00 now and trades at $91.72.
* Gold – Holds over psychological $1900 now back to $1908.
* Bitcoin broke lower to trade at $36,800.
* FX markets – EURUSD under 1.1300, USDJPY holds below 115.00 to 114.50 earlier and 114.75 now. Cable breaches under 1.3600 and trades at 1.3590.

Overnight- JPY CPI data (0.8% vs 1.1% & 0.5% previously), but all focus was centred on geopolitics.

European Open – The March 10-year Bund future is up 49 ticks, US futures are outperforming as investors head for safety while keeping a close eye on the developing situation in east Ukraine. The standoff between the West and Russia will keep pressure on stock markets, which already sold off yesterday and are set to correct even more today. DAX and FTSE 100 futures are currently down -1.1% and –0.7% respectively.

Today – German Ifo, US Flash PMIs, Speeches from Fed’s Bostic and BoE’s Ramsden, Earnings HSBC (beta), Home Depot.



Biggest FX Mover @ (07:30 GMT) NZDCHF (+0.27%) Rallied from lows of 0.6120 earlier, popped to 0.6155 and trades at 0.6140 now. MAs now aligned lower, MACD signal line & histogram significantly below 0 line, RSI 43.25 & falling, OB zone, H1 ATR 0.00010, Daily ATR 0.0048.

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 HotForex 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.

Stuart Cowell
Head Market Analyst
HotForex

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 : 23rd February 2022.

Market Update – February 23 – Oil, Gold & Bonds Ebb; Kiwi Jumps.


Trading Leveraged Products is risky

Stocks stabilised and indexes came up from yesterday’s lows, as markets digest the still fluid developments in Ukraine and the standoff between the West and Russia. Haven demand eased and yields backed up. President Biden announced sanctions on Russia, including financial restrictions. Earlier Germany halted Nord Stream 2. UK will stop Russia selling sovereign debt in London. The RBNZ lifted its policy rate by 25 bp to 1.00%, adding to signs that central banks are moving out of crisis mode and are set on policy normalisation. Governor Bowman opened the door for a 50 bp liftoff next month. Gold below $1900, Oil settled at $90.50. Treasury yields cheapened with the front end underperforming on worries over aggressive rate hikes to help contain inflation.

* USD down (USDIndex 95.11) as risk appetite has stabilised.
* US Yields 10-year yield richened to 1.844% overnight before climbing to 1.958% then settling at 1.925%.
* Equities – GER30 and UK100 futures are up 0.6% and 0.1% respectively, while a 0.7% rise in the USA100 is leading US futures higher.
* USOil – Steady at $90.50 as neither sanction appears as harsh as it could have been.
* Gold – dipped as haven demand ebbed – below $1900.
* Bitcoin broke higher to trade at $38,388.
* FX markets – NZDUSD jumped to 0.6776, EURUSD at 1.1340, USDJPY steady at 115.00. Cable breaches 1.3600.

European Open – German consumer confidence unexpectedly dropped to -8.1 in the advance reading for March. The March 10-year Bund future is down -4 ticks, Treasury futures are outperforming slightly, although the German 30-year future also seems to be benefiting from the prospect of reduced ECB support as surveys signal a swift rebound from the latest virus wave, but also mounting inflation pressures. Risk appetite has stabilised somewhat, although markets will keep a wary eye on Ukraine and the standoff between the West and Russia. For now though the focus seems back on central banks and the Fed’s tightening schedule.

Today – Today’s local calendar includes the final Eurozone HICP number, which will highlight once again that inflation is staying higher for much longer than initially expected. That in turn is putting pressure on the ECB to rein in stimulus. The UK has the latest retailing survey, which should register the easing of virus restrictions.



Biggest FX Mover @ (07:30 GMT) NZDJPY (+0.74%) Spiked to 78 highs earlier. MAs now aligned higher, MACD signal line & histogram significantly above 0 line, RSI 72.66 & rising. H1 ATR 0.155, Daily ATR 0.781.

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 HotForex 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
HotForex

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 : 24th February 2022.

Market Update – February 24 – Stocks plummet, oil up as Russia attacks Ukraine.


Trading Leveraged Products is risky

Risk aversion has hit markets hard amid reports of a full blown attack by Russia on Ukraine, which has also lifted Brent clearly above the $100 per barrel mark. Ukraine declared a 30-day state of emergency, called up reservists and urged its citizens to leave Russia. More cyber attacks on government websites and banks and disinformation campaigns were seen as a prelude to war. Also, US officials said diplomacy with Russia was dead for now. That added to the gloom. Russia suspended movement of commercial vessels in Azov Sea. Von Der Leyen – EU Planning `Massive Sanctions’ on Russia.

Treasuries rallied and stock markets across Asia sold off as the world watches Ukraine. The US Treasury rate is down -12.3 bp at 1.868%, while the Nikkei has lost -1.8%, the ASX nearly 3% and Hang Seng and CSI 300 -3.1% and -2.3% respectively. Brent is trading at $102.19, the front end WTI future at $97.07 per barrel. Gold below $1949. USDRUB at 80.99.

* USD spikes (USDIndex 96.75)
* US Yields 10-year yield down to 1.868%.
* Equities – GER30 and UK100 futures are down more than 3.5% and 2% respectively, while USA500 was down 2.3% and USA100 fell 2.8%, putting the USDIndex on track toward confirming it is in a bear market.
* Reuters: “Closing down at least 20% from its Nov. 19 record high close of 16,057.437 points would confirm the Nasdaq has been in a bear market, according to a widely used definition. That would mark its first bear market since 2020, when the coronavirus outbreak crushed global financial markets.”
* USOil – spiked to $96.46, & UKOIL passed $100 a barrel for the first time since 2014, adding to inflation worries.
* Gold – rallied over 2% as haven demand ebbed – below $1900.
* Bitcoin below $35,000 as, sell-off spread to cryptocurrency markets as well.
* FX markets – Yen benefited, while the Euro and to a lesser extent Sterling struggled. EURUSD at 1.1245, USDJPY drifted to 114.39, Cable breached 1.3485.

European Open – The March 10-year Bund future has gained 182 ticks, outperforming versus US futures, which are up 119 ticks, while in cash markets the US Treasury yield has lifted off overnight lows, but is still down -10.9 bp on the day at 1.882%. Europe in particular is seen as vulnerable to the escalation of the situation because it could also potentially affect energy supplies, although a German economic institute yesterday suggested Germany could get through the winter even if Russia totally cuts off gas supplies. Meanwhile more sanctions on Russia’s economy are underway and for now the situation remains fluid, which will keep markets in defensive mode and heading for safety.

Today – Today’s data calendar includes US GDP, Jobless claims, PCE and speeches from ECB members and Fed Members.



Biggest FX Mover @ (07:30 GMT) USDRUB (+6.42%) Spiked to 80.99 high. MAs now aligned higher, MACD signal line & histogram significantly above 0 line, RSI 72.88 & rising. H1 ATR 0.54430, Daily ATR 1.32211.

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 HotForex 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
HotForex

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.