HFMarkets (hfm.com): New market analysis services.

[HFM]

Date: 8th February 2024.

Market Recap – S&P500 Breaks 5k; Gold & USD in a range!

Economic Indicators & Central Banks:

* Asian stock markets were mixed with mainland Chinese stocks swinging between gains and losses on the eve of the Lunar New Year holidays, while Treasuries stabilized.
* China CPI tumbled to an -0.8% y/y pace in January, steeper than forecast, after falling at a -0.3% y/y clip in December. It is the fastest pace of decline since September 2009 and a fourth straight month in deflation.
* Japanese bourses outperformed,after BoJ’s Uchida said it is hard to see a rapid lift-off in rates.
* Treasuries bounced back after the worst 2-day stretch since June 2022.
* Dovish Fed’s Kashkari currently sees two to three rate cuts would be appropriate this year, as things stand.

Market Trends:

* The Nikkei rallied 2.1%, mainland China bourses and the Hang Seng corrected again.
* European and US futures are higher despite a slight rise in yields.
* The S&P 500 hit a new high at the close, breaking the 5,000 level , driven by confidence in the economy despite worries like Fed policy changes and market conditions. The market remains strong with good momentum, even in a slower season.
* Ford Motor, Chipotle Mexican Grill and other big stocks climbed following their latest earnings reports.

Financial Markets Performance:

* The USDIndex is at 104.03, in a tight range as markets digest mixed Fed speeches and ahead of more economic data.
* The USDJPY depreciated against the US Dollar, reaching 148.80, following comments from BoJ Deputy Governor Shinichi Uchida indicating that the central bank is unlikely to pursue aggressive interest rate hikes, even as it moves away from negative interest rates.
* USOIL rose for the 3rd day in a row, above $74, driven by gains in financial markets and ongoing tensions in the Middle East. The rise in global stocks is boosting demand for oil, despite the Federal Reserve’s dismissal of immediate interest rate cuts.
* Gold steady at $2030-2038.
* Bitcoin rose 0.85% to $44,564.62.

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.

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.

Andria Pichidi
Market Analyst
HFMarkets

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

[HFM]

Date: 9th February 2024.

Market Recap – Yen, Oil & Bitcoin Hit Key Resistance Levels Ahead of US Inflation Week.

Economic Indicators & Central Banks:

* Markets are closed for the holiday in mainland China, Taiwan, South Korea, Indonesia, the Philippines and Vietnam.
* Treasuries declined for a 2nd straight session & Wall Street closed with small gains, as the market continues to shed expectations on Fed rate cuts ahead. The catalyst for selloff was the declines in initial and continuing jobless claims, reversing some of the recent increases and indicating the job market remain solid.
* Nikkei (JPN225) saw an uptick at Friday’s close, pulling back from a 34-year peak as investors are in a profit taking mode in this 3rd week of gains. It edged up by 0.09% to 36,897.42 after surging as high as 1.15% to 37,282.26, marking its highest level since February 1990.
* German HICP inflation was confirmed at 3.1% y/y in the final reading for January. Inflation is still far above the ECB’s target, but on a clear downtrend, and for the doves at the ECB that is enough to start weighing rate cuts.

Market Trends:

* European futures declined cautiously ahead of US inflation data, while Asia geared down for the Lunar New Year holiday.
* Australian equities remained relatively stable, while Japanese stocks displayed mixed performance, partially supported by a weaker yen.
* The Nikkei rallied 2.1%, mainland China bourses and the Hang Seng corrected again.
* SoftBank Group surged by 8.72%, extending its upward trajectory for a 2nd day following the tech investment firm’s return to profitability after 5 quarters. The rally in SoftBank Group Corp. shares was propelled by a more-than-55% surge in Arm Holdings (Arm chip design unit), in which SoftBank holds a 90% stake, after the British tech company forecasted quarterly sales and profit surpassing Wall Street expectations.
* Nissan plummeted by 12% after the company failed to meet profit estimates.

Financial Markets Performance:

* The USDIndex remained steady ahead of the annual revisions to monthly US inflation data, following last year’s revisions that raised doubts about the Federal Reserve’s progress in managing consumer prices.
* The Yen stabilized after a 0.8% decline against the USD on Thursday, triggered by comments from a BoJ deputy governor hinting at the central bank’s continued accommodative policy stance. The USDJPY broke 149 and extended to 149.49.
* NZDUSD climbed to 0.6133 along with New Zealand yields following ANZ Bank New Zealand Ltd.’s forecast of 2 more interest rate hikes by the RBNZ this year.
* USOIL broke $76, eyes on $80 resistance level.
* Bitcoin spiked to 1-month high above $46,000, with historical data indicating positive returns post-Lunar New Year holidays, averaging over 10% in 10-day returns since 2014.
* Ether, Solana and Cardano also pushed upward.

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.

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.

Andria Pichidi
Market Analyst
HFMarkets

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

[HFM]

Date: 15th February 2024.

Inflation Expectations Were Too Optimistic. Investors Consider More Buys.

Economic Indicators & Central Banks:

* UK inflation unexpectedly remains at 4.0% and Core Inflation data also read lower than expectations causing the Pound to decline.
* US inflation declines but at a weaker pace compared to expectations. US inflation falls from 3.4% to 3.1% (previously expectations were for inflation to fall to 2.9%).
* The best performing currency as we edge towards the European Cash Open is the Australian Dollar, followed by the Japanese Yen.
* The NASDAQ witnesses its largest daily decline in February due to the inflation rate pushing back hopes of an early rate cut.

USA100 – Core Inflation a Concern for the Fed and Investors!

After the release of January’s inflation rate and core inflation data, the USA100 as well as all US indices fell rapidly. When evaluating each component within the NASDAQ, only 6% of the index were able to hold onto their value. All stocks which held more than a 0.50% weight in the index depreciated. The reason for the decline was not that the inflation rate is “too high” or that interest rates cuts are not likely. Instead, the decline is due to investors now believing a cut in March is indeed not possible.

According to analysts, the inflation rate does not indicate any danger to the US economy, nor does it indicate there is any reason for a large lasting decline in US stocks. However, the news can weaken demand in the short term. Again, economists advised the inflation rate is not high, but simply higher than the over-optimistic expectations, and that cuts are still likely in the second quarter of 2024.

The short-term price condition of the index will largely depend on upcoming earnings reports from Cisco and Applied Materials. The two stocks make up 2.70% of the index and if these earnings read higher than expectations, it can reassure investors amid concerns. Cisco has beat earnings per share expectations consecutively over the past 12 months as has Applied Materials.

Investors’ main concern yesterday was the Core Inflation data which continues to prove difficult to tackle. Core inflation does not include products related to food and the energy sector. The monthly Core Inflation Data read 0.4%, the highest since May 2023. But slightly easing concerns is inflation elsewhere falling; the UK inflation remains at 4.0%, Chinese inflation fell as did Swiss inflation. The Producer Price Index will now be vital for investors. If the PPI reads higher than expectations, investors’ concerns could grow and the USA100 could form a correction instead of a smaller retracement.

On the daily chart, a retracement would mean a further decline between 1.89% to 4.40%, whereas a full correction would mean a 6.30%-8.00% decline. Currently the two-hour chart indicates an upward price movement towards the 75-bar exponential moving average. However, investors should note this will largely depend on earnings data, the US Retail Sales and Friday’s PPI release.

GBPUSD – The Pound Gives up Gains after Lower Inflation Data

The exchange rate continues to trade below major trendlines for a second day after stronger US inflation and weaker UK inflation. The possibility of the Bank of England opting for a rate cut first, or within the same month as the Federal Reserve grows. However, this will depend on upcoming data from the UK over the next 48-Hours.

The UK is scheduled to release their Monthly GDP and Retail Sales on Friday. If both read lower than expectations, the possibility of an earlier rate cut by the Bank of England rises. The UK’s Gross Domestic Product is believed to have declined by 0.2%, which would be the third decline in 6-months.

Technical analysis also indicates a downward trend. The price of the exchange trades below the 75-bar EMA and below the neutral on the RSI. On the 5 and 15-minute timeframes, the asset is also forming downward crossovers. These three factors indicate further bearish price movement and the Fibonacci indicates the price can fall down to 1.24990.

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.

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.

Michalis Efthymiou
Market Analyst
HFMarkets

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

[HFM]

Date: 16th February 2024.

Investors Continue to Buy Ahead of the US Producer Inflation Release!

* UK Retail Sales witnesses its strongest increase since May 2021, but economists advise the increase is simply correcting poor data from previous months.
* The Pound gains against most currencies, but the currency market has their eyes fixed on the upcoming US Producer Price Index.
* Applied Materials soars above earnings expectations. Earnings Per Share beat expectations by almost 12% and revenue by 3%. The stock rose 12% after market close.
* Bitcoin again renews its recent highs rising another 2.15% on Thursday. Cryptocurrencies are also likely to witness strong influence this afternoon.

GBPUSD – UK Retail Sales Beat Expectations

The GBPUSD was trading lower throughout the trading session but quickly rose to the day’s open price after the UK’s Retail Sales Release. The Retail Sales read 3.4%, significantly higher than 1.5% which was expected and -3.2% from the previous month. However, economists are advising a strong increase is not as positive as it may seem considering previous months saw a decline of 3.9%. Nonetheless, investors are reacting positively, and the GBP is rising moderately against all currencies.

In terms of technical analysis, the exchange rate is seeing neither bullish nor bearish signals. The price is trading at most trend lines and is neutral on most oscillators. In order for traders to obtain a clear signal, the exchange rate must maintain momentum and show a clear direction. If the price breaks above 1.26056, which is also the resistance level of the day before, buy signals will materialize. If the afternoon’s Producer Price Release is lower than expectations, a bullish breakout is likely to take place.

The US will release the Producer Price Index, Core PPI and the Prelim Consumer Sentiment. The strongest price driver will be the PPI and Core PPI release. Analysts expect both to read 0.1%, which is only slightly higher than the previous month. However, the question is if the rate of increase will be higher than expectations. Another higher inflation reading will again support the Dollar, but pressure Gold and US Stocks.

USA100 – Investors Await PPI Release and Attempt a Full Correction!

The USA100 saw a slight decline as we were approaching the US open due to weak Retail Sales, but again investors only used this to enter at a better entry level. The index ended the day 0.22% higher and is 0.85% lower than the previous high. Technical analysis currently points towards a full correction back up to $18,058, but this will largely depend on the Producer Price Index.

If the PPI reading is higher than 0.1%, the USA100 and the stocks market in general can witness another decline. The decline may simply be a retracement or a full correction back to 1.25341, but this would depend on how much higher the reading is. If the PPI and Core PPI reads 0.1% or lower, the bullish trend potentially can continue as per indications from Crossovers, VWAP, and Oscillators.

The index was supported by Applied Materials which released their quarterly earnings report. The company’s Earnings Per Share beat expectations by almost 12% and revenue by 3%. The stock rose more than 12% after the market close and can support the index if it continues to perform well in the upcoming days. The next major earnings report will be NVIDIA next Wednesday after market close.

Bitcoin – Net Inflows of Over $1 Billion this Past Week

The cryptocurrency market capitalization rose this week, but slightly fell this morning ahead of the PPI release. However, the general rise is positive for Bitcoin as is its higher market share which rose 0.29%. Investors should note the day’s inflation reading is likely to also affect Bitcoin in a similar way to the stock market.

The cryptocurrency market is being supported by the weaker monetary policy in China, one of its largest markets. However, the price action will depend on continued relaxation from across the globe. Another reason is demand for spot-Bitcoin ETFs which remains strong, with net inflows of over $1 billion over the past week. Technical analysts also note the importance of surpassing the $50,000 mark which is a strong psychological price/level.

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

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

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.

Michalis Efthymiou
Market Analyst
HFMarkets

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

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[HFM]

Date: 19th February 2024.

Market Recap – China Back, US closed!

Economic Indicators & Central Banks:

* Chinese stocks climbed slightly as China returned from the long New Year holidays. Modest gains showed that investors are worried about the longterm outlook. Much of the economy’s sluggishness is a function of the collapse in the property sector as well as the bearish effects of the many regulatory restrictions in tech, problems that would not be helped much by easier policy.
* US markets are closed for the Presidents’ Day holiday.
* This week: Eyes on European inflation data, PMI data from EU, UK and US, RBA & FOMC Minutes, as well as earnings from Nvidia Corp. and BHP Group Ltd to help gauge the health of the global economy.

Market Trends:

* Nikkei (JPN225) holds near 1989 highs, pressured by Friday’s selloff but also due to decline in chip-related shares. Nintendo was the biggest percentage decliner though, slumping 5.8%. Chip-sector heavyweights Advantest and Tokyo Electron were the Nikkei’s biggest drags, shaving off 60 and 55 index points respectively with declines of 3.2% and 1.6%.
* European stock futures are in the red, US futures fractionally higher on what is likely to be a quiet day, as US markets are closed.
* S&P500(USA500) rose 0.1%, Nasdaq (USA100) rose 0.2%.

Financial Markets Performance:

* The USDIndex’s gains faded after the hot inflation stats crushed expectations for quick and deep Fed rate cuts. Currently at 104.
* The Yen is directionless, with USDJPY sideways close to 150 with volumes likely to be low through the day. The drag from higher US bond yields, particularly on tech stocks, is offsetting support from a weak yen.
* USOIL pulled back from $78 highs on the ongoing Middle East tension. The IEA signaled last week that oil markets could be oversupplied all year, and China’s soft economy has raised questions about consumption. Still, attacks on shipping in the Red Sea and the Israel-Hamas war are keeping prices from falling too far.
* Gold extends Friday’s gains, above $2020.
* Bitcoin at $52514.

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.

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.

Andria Pichidi
Market Analyst
HFMarkets

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

[HFM]

Date: 20th February 2024.

Market Recap – US & European equities declined, mirroring the drop in Asian stocks.

Economic Indicators & Central Banks:

* Futures for both US and European equities declined, mirroring the drop in Asian stocks, as an adjustment to China’s mortgage reference rate did little to alleviate worries surrounding the world’s 2nd largest economy.
* China implemented a record rate cut, reducing the 5-year loan prime rate by 25 basis points to 3.95%, surpassing economists’ expectations of 5 to 15 bp cuts.
* The RBA maintained its cautious stance, further suggesting that rate cuts were not imminent. Minutes from the central bank’s February meeting, released today, indicated that policymakers require additional time to ascertain if inflation is indeed decreasing before considering any potential interest rate hikes.
* Market sentiment outside China weakened as expectations for US rate cuts dwindled following higher-than-expected producer and consumer prices.
* Today: The Canadian inflation and European wages data, which are expected to influence market movements going forward.

Market Trends:

* Nikkei (JPN225) retreated by 0.3% from its recent highs.
* US Treasury yields edged up slightly, with S&P500 (USA500) futures and European futures both declining by 0.3%.
* BHP Group, the world’s largest miner, reported $6.57 billion in underlying profits, less than consensus estimates, and stated demand from top customer China was healthy despite weakness in housing.

Financial Markets Performance:

* The USDIndex strengthened broadly surpassing 150 Yen, amid expectations of sustained higher US interest rates, despite Japan’s recession and uncertainty over its monetary policy exit.
* The Aussie, often viewed as a proxy for China’s economic health, remained largely unchanged, while iron ore futures, linked to Chinese construction demand, declined by 3%.
* The Yuan initially dropped to its lowest level in 3 months but stabilized at 7.1981 in the Asia close.
* Gold was little changed after edging higher Monday to trade around $2,020 per ounce.
* The USOIL edged higher against the backdrop of ongoing tensions in the Red Sea, a vital trade route. It is retesting again the January’s high again.

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.

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.

Andria Pichidi
Market Analyst
HFMarkets

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

[HFM]

Date: 22nd February 2024.

In-Depth Analysis – AUDUSD – Investors Expect Fed to Cut First!

AUDUSD – Economists Do Not Expect the RBA to Cut Until 2024’s Third Quarter.

* The Aussie Dollar increases 0.67% and sees its strongest gain this week so far. The exchange rate trades at its highest price since February 2nd.
* The FOMC’s Meeting Minutes indicate the Federal Reserve is not yet willing to cut interest rates. FOMC Members are cautious about cutting rates too fast.
* Australia’s Wage Price Index for the latest quarter continues to read higher than where the RBA would like to see it.
* The Reserve Bank of Australia advise the regulator would not consider cutting interest rates until the second half of 2024.
* The Australian Economy weakens but not enough to pressure the RBA! Inflation remains moderately higher than the US!

AUDUSD – Technical Analysis

The AUDUSD is witnessing one of the lowest spreads amongst the major currency pairs and is seeing higher levels of volatility. The Australian Dollar has been rising against the USD for seven consecutive days, similar to the NZD and the Euro. However, the AUD is performing better than the GBP, JPY and CHF against the Dollar. However, investors should note that the bullish price movement is largely being driven by the weakness in the Dollar.

The US Dollar Index has fallen 0.50% this week and trades at a 3-week low. The Australian Dollar on the other hand is witnessing mainly bullish price movements depending on the currency pair. The Australian Dollar is increasing against the GBP, Euro, Yen, and the CHF but is declining against the NZD. So here we can see there are no major conflicts between the two individual currencies. However, investors will need to continue monitoring the US Dollar Index and price condition of the AUD against other major currencies.

The AUDUSD is trading above the 75-Bar Exponential Moving Average and above the “Neutral” level on the RSI as well as the Bollinger Bands. These three factors indicate a further bullish trend as the asset is yet to be read “overbought” on most oscillators. In addition to this, the asset has managed to break above the resistance level and the previous high, meaning the continuation of the traditional wave pattern.

The only negative indication when evaluating technical analysis is the measurements of the previous 4 impulse waves. The average bullish wave size is 0.87% and the largest has been 0.92%. The current impulse wave reads 0.87%. Therefore, if the pattern is to continue the price may retrace soon, even if it is going to continue rising thereafter. However, this cannot be known for sure.

AUDUSD – Fundamental Analysis

In the Meeting Minutes, representatives stated more fear about the remaining risks of a premature decline in rates than about a persistent period of high interest rates. Against this background, markets are reconsidering the timing of a possible easing of the regulator’s position in May and June. According to the CME Groups FedWatch Tool, the likelihood of a May adjustment is currently anticipated at 30-35%. A strong possibility is considered anything above 70%.

Next week’s Core PCE Price Index will be key for the Dollar as this will be the last inflation reading for the month and short-term future. If the PCE Price Index is also higher, this means all 5 inflation readings beat expectations. As a result, the Dollar may rise. However, the Dollar’s issue is that the market’s risk profile is high, and many expect the Fed to cut first. Therefore, the Dollar may continue to struggle unless other central banks become more dovish.

Even though the Reserve Bank of Australia’s interest rate is lower than the Fed’s, analysts expect the Fed to cut first. Even though GDP Growth in Australia is weakening, the economy is still performing better than Europe and the UK. In addition to this, inflation is still above 4.00%, which is extremely high for the Aussie and the Unemployment Rate has risen to 4.1% which is still manageable according to analysts there. Therefore, most analysts believe the RBA will cut in the third quarter and after the Fed. Therefore, fundamental analysis is slightly in the Aussie’s favor here, but technical analysis will need to continue signalling a rise.

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.

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.

Michalis Efthymiou
Market Analyst
HFMarkets

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

[HFM]

Date: 23rd February 2024.

Market Recap – Global Rally Pushing Valuations To Record Highs Across the US, Europe & Japan.

Economic Indicators & Central Banks:

* It was all about Nvidia. Nvidia got a $277 billion 1-day boost to its market capitalization yesterday – the biggest single-session increase in value ever!(the previous record was a $197 billion gain by Meta Platforms Inc.)
* Treasuries continued to lose ground, hurt by the surge in risk appetite with yields cheapening to the highest levels since late last year.
* The solid jobless claims report, which followed on the heels of the hawkish bent in the FOMC minutes, added to expectations the FOMC will leave rates in restrictive territory into June at least.
* A weaker than expected S&P Global services headline saw rates dip briefly.
* Japanese markets are closed for a public holiday.
* Fed Governor Christopher Waller: ”interest rate cuts should be delayed at least two more months, but indications of healthy demand and concerns over supplies could boost prices in the coming days.”
* Today: Germany IFO business climate & GDP, ECB publishes 1- and 3-Year inflation expectations survey.

Market Trends:

* Massive global rally in risk that saw the NASDAQ(USA100) jump 2.96% to 16,041.6, falling just short of the historic peak of 16,057 from November 2021. The S&P500 (USA500) climbed 2.1% to 5100, and the Dow (USA30) was up 1.18% to 39,069, both marking new records.
* Asian stock markets today continued to move higher, with the global rally pushing valuations to record highs across the US, Europe and Japan. The Nikkei jumped a further 2.2%.

Financial Markets Performance:

* The USDIndex was little changed at 103.80, below 104 for the first time since February 2.
* The Yen has performed the worst so far this year, experiencing a 6.3% decrease against the Dollar, as investors sought higher yields in other currencies, anticipating that Japan’s interest rates would remain close to zero for the foreseeable future.
* The Yen weakened against the Euro, Sterling, and other currencies this week, marking its 4th consecutive weekly decline against the US Dollar.
* USOil slipped to $77.85 per barrel after Fed speeches indicated delay to rate cuts.
* Gold dipped to $2021 per ounce.

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

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

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.

Andria Pichidi
Market Analyst
HFMarkets

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

[HFM]

Date: 26th February 2024.

Oil and the New Zealand Dollar Decline After Weak Economic Data!

Economic Indicators & Central Banks:

* The New Zealand Dollar witnesses a quick decline as we approach this week’s central bank decision and press conference. The NZD falls 0.50% within the first three hours of trading.
* Oil drops to the lowest price since February 15th after investors price in a delayed interest rate cut.
* US Oil declines after the Energy Information Administration (EIA) recorded an increase in oil reserves of 3.5 million barrels. The higher level of supply can continue to pressure quotes if demand falls.
* The US Dollar Index trades 0.12% lower during the Asian Session and so far, continues to maintain a “sell signal”.

NZDUSD – The New Zealand Dollar Declines Against All Currencies!

The day’s worst performing currency is the New Zealand Dollar which is declining against the whole currency market. Throughout the month of February, the NZD has been one of the best performing currencies, but as trading started this morning, a sizable decline was apparent. The NZDUSD is trading 0.50% lower, but the New Zealand Dollar is witnessing the strongest decline against the Pound. Against the Pound, the NZD fell 0.60% within this morning’s Asian Session.

The economy over the past 12 months within the country has seen a decline in GDP growth and Retail Sales while the Unemployment Rate has risen for four consecutive months. At the start of 2023, New Zealand had an unemployment rate of 3.4% while the latest reading was 4.00%. Economists are easily able to see how the restrictive monetary policy and weaker Chinese Market are weighing on the economy. Simultaneously, inflation remains stickier than elsewhere and considerably higher than elsewhere. These factors have resulted in economists potentially considering a more cautious tone towards the NZD.

Throughout the week, investors will mainly be keen to see what the Central Bank has to say regarding economic frailty and how this will affect monetary policy. For the current meeting, investors believe the policy will remain unchanged. However, if the economy continues to deteriorate in upcoming months, the RBNZ is likely to consider a cut sooner rather than later.

In terms of technical analysis, the price is currently “neutral” but close to a sell signal. The sell signal has not yet materialized as the exchange rate has seen significant gains over the past 2 weeks. However, if the price falls below 0.61618, the exchange rate will renew “sell” signals. Ideally investors would also like to see strength in the Dollar and the US Dollar Index. This way, the exchange rate is not experiencing two declining currencies.

USOIL – Oil Declines on Fears of a Global Slowdown!

The commodity saw a strong and sudden decline on Friday measuring 2.25% which lasted throughout the whole day. The price this morning is again witnessing a lower price as investors continue to struggle to maintain demand while the global economy is in stagnation, supply remains high and tensions in the middle east have not continued to escalate.

On Friday, the Fed’s board member Mr Waller said the Central Bank might refrain from lowering interest rates for at least several more months. Investors fear that maintaining a tight policy could cause a slowdown in economic growth. Consequently, this could limit oil demand in one of the leading consumers. Some economists have also voiced concern that other central banks in weaker economies may also follow the Fed even though their economies are underperforming.

Technical analysis, even though not a price driving factor, can assist with understanding the price condition. After the strong decline on Friday, the price is trading below most Moving Averages such as the 75-Bar-EMA and below 50.00 on the RSI. In addition to this, most timeframes show a downward crossover and the price trades below the Volume Weighted Average Price. However, Oil prices are trading at a support level which can be seen on February 21st, 15th and 12th. Therefore, to maintain a “sell” signal, the commodity will need to see fundamental factors pressure quotes further. This is likely if US economic data is lower and US inflation is higher. The US will release their Core PCE Price Index on Thursday and Germany will release their Consumer Price Index the same day.

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.

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Michalis Efthymiou
Market Analyst
HFMarkets

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