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

[HFM]

Date: 28th March 2024.

The US Dollar Strengthens As Economists Believe The ECB Will Struggle To “Hold”.




* Early this morning, the Fed Governor advised “there is no rush to cut rates” and “the data within the upcoming months” will be vital.
* The US Dollar Index rises to a 1-month high. The value of the USD will largely be based on today’s data on economic growth, consumer sentiment and pending home sales.
* Dollar and index traders are closely monitoring tomorrow’s Core PCE Price Index which analysts expect will read 0.3%. A higher inflation reading can potentially pressure stocks and support the Dollar.
* Strong declines in NVIDIA and Netflix stocks pressured the NASDAQ on Wednesday. Though, buyers entered late in the session to boost the overall price.

EURUSD

The latest comments from members of the Federal Reserve are supporting the US Dollar. The forward guidance between members of the Federal Reserve is mainly not aligned. The Chairman advises the Fed does not need much more proof for the regulator to feel comfortable reducing rates. Whereas the Fed Governor, Mr Waller, advises there is no rush, and he wants to see a few months of data before determining the next move. Therefore, the upcoming inflation and employment data will remain vital and could even push back rate hikes further. According to economists, the Federal Reserve will cut the interest rate on 3 occasions this year, but the timing of the first cut is less certain and may change depending on upcoming data.

A positive factor for traders is that EURUSD exchange is not witnessing conflicting currencies. The US Dollar is trading 0.12% higher while the Euro is declining against most currencies. The Euro is trading 0.06% lower against the Pound and the Canadian Dollar and 0.16% lower against the Japanese Yen. Yesterday, the head of the Bank of Italy, Mr Cipollone, said that the authorities were confident that inflation would return to the target of 2.0% by mid–2025. He also supports the lower of interest rate and will use this as a basis for adjusting monetary policy. The Euro is generally under pressure as investors believe the European Central Bank will struggle to avoid cuts if the Fed decide to delay their adjustments.

The US Dollar will be influenced by four major economic data releases. The US Final GDP, Weekly Unemployment Claims, Pending Home Sales and Consumer Sentiment Index. If these read higher than expectations with the weekly unemployment claims dropping, the US Dollar is likely to witness further support. However, investors should note the main release will be tomorrow’s Core PCE Price Index. Traders are expecting no major news for Europe and volatility levels may fall tomorrow as European markets are closed for Easter.



Technical analysis currently points towards a continued downward trend. The price is trading below the neutral on the RSI and below the 75-Bar EMA. However, investors should note this will also be dependent on upcoming US data.

USA100

The price of the USA100 was under pressure throughout the whole US session but was saved by an increased volume of buyers late in the session. However, a positive point is the components held onto their value. Even though the index fell in value, only 28% of the components declined. Investors will now turn their attention towards tomorrow’s PCE Price Index and the upcoming earnings season which will start in mid-April.

The price is now trading slightly above the Moving Averages but slightly below the 50.00 on the RSI. Therefore, technical analysis remains at the “neutral” level and continues to indicate a larger price range. If today’s economic data is positive the stock market can witness confidence and support as this continues to indicate a soft landing. Though, if the data is too strong, it could also trigger a hawkish Fed which is known to be negative for the USA100.



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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

[HFM]

Date: 29th March 2024.

GBPUSD Analysis: The Pound Trades Higher But For How Long?



* The global Stocks Markets are closed due to Easter Friday (Good Friday). The NASDAQ continued to follow the sideways trend while other indices again rose.
* The SNP500 reaches an all-time high, but the NASDAQ remains under pressure from Tesla, Meta and Apple.
* The Euro continues to trade lower against all major currencies including the US Dollar, Euro and Japanese Yen.
* The British Pound is the best performing currency during this morning’s Asian session. However, investors are largely fixing their attention on this afternoon’s Core PCE Price Index.

GBPUSD – The Pound Trades Higher but For How Long?

The GBPUSD is slightly higher than the day’s open and is primary due to the Pound’s strong performance. At the moment, the British Pound is increasing in value against all major currencies. However, the US Dollar Index is also trading 0.10% higher and for this reason there is a slight conflict here. If investors wish to avoid this conflict, the EURUSD is a better option. This is because, the Euro depreciating against the whole currency market avoiding the “tug-of-war” scenario.

The GBPUSD is trading slightly lower than the 2-month’s average price and is trading at 49.10 on the RSI. For this reason, the price of the exchange is at a “neutral” level and is signalling neither a buy nor a sell. The day’s price action and future signals are possibly likely to be triggered by this afternoon’s Core PCE Price Index.



Analysts expect the Core PCE Price Index to read 0.3% which is slightly lower than the previous month but will result in the annual figure remaining at 2.85%. The PCE rate is different to the inflation rate and the Fed aims for a rate between 1.5% to 2.00%. Therefore, even if the annual rate remains at 2.85%, as analysts expect, it would be too high for the Fed. If the rate increases, even if only slightly, the US Dollar can again renew bullish momentum and the stock market can come under pressure. This includes the SNP500.

Investors are focused on the publication of data on the UK’s gross domestic product (GDP) for the last quarter of 2023: the quarterly figures decreased by 0.3%, and 0.2% over the past 12-months. This confirms the state of a shallow recession and the need for stimulation. The data, combined with a cooling labor market and a steady decline in inflation, increase the likelihood that the Bank of England will soon begin interest rate cuts. In the latest meeting the Bank of England representatives did not see any members vote for a hike.

USA500 – The SNP500 Rises to New Highs, But Cannot Hold Onto Gains!

The price of the SNP500 rises to an all-time high, before correcting 0.33% and ending the day slightly lower than the open price. Nonetheless, the index performs better than the NASDAQ which came under pressure from Tesla, Meta and Apple which hold a higher weight compared to the SNP500. For the SNP500, these 3 stocks hold a weight of 9.25%, whereas the 3 stocks make up 14.63% of the NASDAQ. The SNP500 is also supported by ExxonMobil’s gains due to higher energy prices.

The market will remain closed on Friday due to Easter. However, the market will reopen on Monday for the US and investors can expect high volatility. Investors will also need to take into consideration how the PCE Price Index and the changed value of the US Dollar is likely to affect the stock market next week.



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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

[HFM]

Date: 1st April 2024.

Strong Chinese Economic Data Prompts Demand for US Stocks!


Trading Leveraged Products is Risky

* The Chinese economy and sentiment improve for the first time since September 2023. Chinese Manufacturing PMI rose to 50.8, beating expectations. Higher Chinese data improves the global risk appetite towards stocks.
* Stocks trade higher, what is more, the SNP500, and Dow Jones again renew their all-time highs. The latest Chinese data and a PCE Price Index in line with expectations support price growth.
* The price of Gold and the US Dollar Index are both on the rise, which is a concern for investors. The market’s price movement gives no clear indication of investor’s risk appetite.
* Apple is expected to confirm the Vision Pro Headset will be made available to global consumers in the summer months.

USA500 – Inflation, Earnings and Company News!

The USA500 starts the day with a moderate bullish price gap measuring 0.21% and continues trading 0.52% higher ever since. The price of the index is now trading at an all-time high and has risen more than 10.50% in 2024. The SNP500 has also been the best performing index in 2024 and has outperformed both the NASDAQ and Dow Jones? The question for traders is, will this continue?



A positive factor for the USA500 is the Federal Reserve and most global central banks are likely to start cutting interest rates at some point this year. The main factor which investors needed to see is that central banks were able to do so without triggering a significant economic contraction, which was achieved. Another positive factor is the Core PCE Price Index did not beat expectations, which was vital considering inflation over the past 2 months kept reading higher than previously thought.

However, some risks do remain which can make the path difficult for buyers. The price of Gold as well as the price of the US Dollar continue to rise. This occurrence indicates the market’s risk appetite and sentiment is lower than priced in the stock market. Another concern is whether the Federal Reserve will be able to indeed cut interest rates in July 2024 if inflation does not decline over the next 2 months.

Investors are closely watching the price of oil which is trading 13.50% higher in 2024 and at a 6-month high. If the price of Oil continues to rise and fails to fall back below $80.00 per barrel in the next two months, inflation will be difficult to reduce. As a result, the Fed may again push back a rate cut to July or September. Otherwise, the Fed may continue with a cut in June, but will advise less than 3 cuts for the remainder of the year.

So, what can save the SNP500 and stock market if the Fed chose not to cut and if inflation rises. The answer is the quarterly earnings reports scheduled for later this month and in May. Investors will mainly be focusing their attention on the following stocks:

1. Microsoft
2. Apple
3. NVIDIA
4. Alphabet
5. Amazon
6. Meta

The stock which is a concern for investors is Apple Stocks. Apple has received a large penalty from the EU and is now facing a lawsuit from the US. Shareholders will be keen to see what the board of directors have to say regarding this and how it will affect the earnings per share. Investors will also be keen to see the performance of the Apple Vision Pro Headset which was released in February. If the sales figure reads as expected or beats expectations, the demand for the stocks can rise regardless of the upcoming fines. Apple is also expected to announce that the product will be made available to global consumers later in the summer. Apple quarterly earnings will be released on May 2nd and Microsoft on April 23rd.

USA500 – Technical Analysis After Strong Chinese Economic Data

Over the past 3 trading days, the price of the USA500 has successfully been forming higher highs and higher lows. The price this morning saw strong momentum, which was also due to positive economic data from China. The Chinese Manufacturing and Non-Manufacturing PMI beat expectations. Furthermore, technical indicators continue to indicate a higher price. The price remains above the 75-Bar EMA and above the 50.00 level on the RSI. In addition to this, delta statistics also indicate buyers are controlling the market. If the price again rises above $5,273.31, the breakout will further indicate upward price movement.



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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

[HFM]

Date: 2nd April 2024.

Market Recap – Inflation: Will be back?


Trading Leveraged Products is Risky

Economic Indicators & Central Banks:

* Treasuries were hit by stronger than expected ISM data and yields climbed sharply in a bear steepener. – US manufacturing unexpectedly expanded for the first time since September 2022 & input costs climbed.
* The latest ISM data indicates that the US economy continues to display strength despite elevated interest rates. This bodes well for the stock market, as it has the potential to fuel profit growth for businesses. However, it also raises concerns about inflationary pressures.
* Wall Street took its lumps to start Q2 amid the eroding Fed view and the pop in interest rates. The broader indexes closed with losses, though from fresh record highs last Thursday.
* FED: Expectations are moving toward fewer cuts this year as well, from the 3 that have been in for priced in much of 2024 to date, consistent with the FOMC’s dots, to 2, 1, or even none. A couple of key Fed officials, Waller and Bostic, have indicated their preferences for fewer than 3 cuts this year. Now there is a 61% chance of the Fed cutting rates in June.
* UK Nationwide house prices unexpectedly dropped -0.2% m/m in March, after rising 0.7% m/m in the previous month.



Market Trends:

* The Dow dropped -0.6% and the S&P 500 slid -0.2%. The NASDAQ managed a 0.11% rally.
* European stock futures are slightly higher in early trade, with the FTSE 100 outperforming. The Hang Seng rallied overnight, as Hong Kong’s markets re-opened after the extended holiday weekend and investors reacted to the better than expected Chinese PMI reports.



Financial Markets Performance:

* The USDIndex climbed back over the 105 level thanks to the strength in the data, closing at 105.019 and hitting the highest closing level since mid-November. Underpinning * the move has been the hotter inflation data and resilient growth that have been shifting outlooks on the FOMC’s rate cutting trajectory, pushing back the timing of the first move toward July rather than June.
* The Yen was steady higher at 151.70. Focus is now fixed squarely on the BOJ’s bond-buying operation scheduled for Wednesday.
* Gold managed to hit a fresh peak at $2251.44 per ounce and a second close over $2200.
* USOIL breached 61.8% Fib. level since the September downleg, at $84.14. (Rising geopolitical risks in the ME & tighter supply from Mexico helping to buoy prices.)
* Bitcoin drifted back to $67k amid cooling demand for dedicated US ETFs and ebbing bets on looser Fed policy. – 10% down since $73,798 highs in mid-March.

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
HMarkets

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

[HFM]

Date: 3rd April 2024.

Market Recap – ‘Good News is Bad News’


Trading Leveraged Products is Risky

Economic Indicators & Central Banks:

* Rate cut hopes for the US are fading, which is weighing on stock markets. Bonds have found a footing, at least outside of the US, and the 10-year Bund yield is down -1.4 bp, after the 10-year JGB corrected -1.3 bp.
* A rise in February JOLTS, albeit after a downward revision to January, and a better than expected factory report, exacerbated the sell off in longer dated Treasuries.
* Disappointing delivery news from Tesla, along with weakness in the health and retail sectors, weighed on sentiment.
* Rising geopolitical risks boosted Gold and Oil.
* Fed’s Mester(Voter) & Daly (Voter): They still see 3 cuts this year, which helped trim losses. Mester stated that she will not vote for a cut at the May meeting given the lack of sufficient data but said she would not rule out action in June.
* China’s manufacturing activity expanded at the fastest pace in 13 months in March. Yuan declined despite data.
* Today: EU Inflation & Core, US ADP, US ISM Services and Fed Powell speech. OPEC ministerial meeting is also on tap and it is expected to confirm current output cut targets.



Market Trends:

* Wall Street slumped as well on JOLTS and hence the Fed outlook and the rise in yields with the major indexes falling over -1.0% before paring losses. The Dow finished with a -1.0% drop, while the S&P500 was down -0.72% and the NASDAQ -0.95% lower.
* Stocks have sold off across Asia, with Hang Seng and ASX underperforming and losing more than -1%. US futures are also in the red, while European futures are narrowly mixed.

Financial Markets Performance:

* The USDIndex climbed to hit 105.10, but it lost traction and slid to close at 104.52 with a pick up in downside momentum after the Fedspeak. Monday’s 105.019 close was the first with a 105 handle since mid-November.
* The AUD & NZD (often used as liquid proxies for the CNH), are under pressure as a result of a stronger USD and a weaker CNH.
* Gold (+11% this year) surged to a new all-time peak at $2288 even as Fed rate cut bets were pared. Silver hit a 2-year high.
* USOIL was up 1.9% at $85.30 per barrel with additional support from expectations for rising demand.
* Bitcoin at $66.3K, under pressure for a 3rd day in a row.

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
HMarkets

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

[HFM]

Date: 4th April 2024.

Market News – USD continues to decline; stock markets mixed.


Trading Leveraged Products is Risky

Economic Indicators & Central Banks:

* Powell wants to keep inflation expectations anchored at 2%. – Recent data have not “materially” changed the overall picture.
* Nothing new is added to the outlook, keeping the door open for several rate cuts this year, though Bostic continues to favor just one easing.
* The ISM services index slowed and prices paid softened, but the ADP solidly beat.
* JGB and Treasury yields have moved up overnight, with the US 10-year 1.8 bp higher on the day.
* Bunds are finding buyers though, with Eurozone spreads narrowing as peripherals outperform.
* Fed funds futures: implied rates are now about 50-50 for a June cut, with July showing about a 95% probability for the first cut. A 25 bp easing is not fully priced until September.
* Swiss inflation drops to just 1.0% y/y. Expectations had been for a slight uptick in the headline and the lower than expected number will justify the SNB’s decision to cut rates at the previous meeting, especially as the growth outlook remains subdued.
* The ECB asserts it won’t rely on the Federal Reserve’s actions to determine when to start reducing interest rates. However, economic trends in the US often swiftly affect other regions, impacting financing conditions, exchange rates, and various metrics such as inflation and trade.


Long Shadow of the Fed Shows Limits of ECB Talk of Independence

Market Trends:

* Wall Street closed with a 0.23% advance in the NASDAQ, a 0.11% gain on the S&P500, and a -0.11% dip on the Dow.
* Stock markets traded mixed across Asia. Nikkei and ASX benefited while China bourses corrected though and the Hang Seng underperformed once again.
* European bourses are slightly in the red, US futures are higher, as markets continue to evaluate rate outlooks and growth prospects against the background of geopolitical risks.



Financial Markets Performance:

* The USDIndex is below 104, in the wake of Powell’s comments along with the stronger than projected ADP which weighed on the markets, and Bostic’s comments.
* The Yen continues to consolidate as investors awaited cues from the BOJ. BOJ board member Sakurai said that the central bank is likely to wait until around October before mulling another interest rate hike.
* Gold remained stable after reaching a new all-time high, surpassing $2,300 per ounce. This surge was supported mainly by Powell.
* USOIL appeared ready for its 5th consecutive day of increases.
* Copper rose to its highest level since January 2023, driven by increasing supply risks and indications of heightened demand

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Andria Pichidi
Market Analyst
HMarkets

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

[HFM]

Date: 5th April 2024.

Market News – NFP day; Geopolitics triggering a flight to safety!


Trading Leveraged Products is Risky

Economic Indicators & Central Banks:

* Global Stocks fell ahead of today’s jobs report, which coupled with the rising geopolitical risks and the angst over the FOMC’s rate trajectory triggered a flight to safety, hence boosting the haven demand.
* Treasuries climbed, the US Dollar ended near session highs and Oil rallied.
* Israeli Prime Minister Benjamin Netanyahu said at a security cabinet meeting his country will operate against Iran and its proxies and will hurt those who seek to harm it. President Joe Biden told Netanyahu on a call that US support for his war would depend on new steps to protect civilians.
* Note: A direct conflict between Israel & Iran could restrict further Oil supply and hence could boost Oil above $100.
* Japan: BOJ Governor Ueda stoked bets about an additional interest rate hike later in the year, if the yen’s weakness affected the economy. FM Shunichi Suzuki repeated warnings that the government would take appropriate measures to support the currency. Meanwhile, former top currency diplomat Hiroshi Watanabe said earlier this week that the government likely won’t make a move unless the Yen plunges below 155 per dollar.



Financial Markets Performance:

* The USDIndex has rallied into the close from the session low of 103.92, finishing back at 104.12. But it was over 105 on Monday, the highest since November.
* The Yen extended a rally to hit a 2-week high. The currency experienced its most significant surge against the USD in nearly a month, prompting a retreat from levels that traders had anticipated might trigger intervention.
* Gold: The rising concerns over the situation in the Middle East have boosted haven demand for gold which climbed to another record peak over $2304 per ounce.
* USOIL jumped to $86.70 and UKOIL rose above $91 near its highest since October. Israel has increased preparations for potential retaliation by Tehran after Monday’s strike on an Iranian diplomatic compound in Syria, stoking fears of a wider regional conflict. OPEC kept global markets tight.
* Copper holds at 14-month highs.

Market Trends:

* Wall Street had a tough session and closed with steep losses of over -1%. The recent record peak on stocks have left the market ripe for profit taking too ahead of jobs.
* The NASDAQ dropped -1.4% and the Dow tumbled -1.36% with the S&P500 slumping -1.23%. Every S&P sector closed with a loss, with only energy preventing a complete rout in the Dow.
* Nikkei drifted more than 2% putting it on course for its worst week since December 2022 as tech shares slid on Wall Street’s lead. – The biggest driver for the Nikkei’s dip is technical.



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
HMarkets

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

[HFM]

Date: 8th April 2024.

Treasury Yields Climb and Investors Anxiously Await March’s Inflation Reading!



* Economists expect inflation to rise from 3.2% to 3.4%, but the monthly incline to be lower than the previous month.
* The Dow Jones sees its worst week of 2024, but stocks rebound on positive employment data.
* The US economy added a further 303,000 more employed individuals and the unemployment rate fell to 3.8%.
* The US Dollar witnesses “mixed” price movement as investors wait for inflation confirmation and clarity on interest rates.

USA500 – Bond Yields Rise 50 Points Potentially Pressuring US Stocks!

The SNP500 is the index which is likely to be most influenced by this week’s earnings data. This is due to the index’s exposure to banking stocks. The price of the USA500 is technically still forming lower lows and lower highs which indicates a downward trend. However, corrective waves remain strong which indicate demand remains. Currently, the price is trading below momentum indications and below the “neutral” on oscillators. Therefore, the price is currently witnessing a weak “sell” signal. However, if the price drops below $5,197.16, indicators are likely to signal a stronger bearish signal.



To obtain further indication of the possible future price movement, investors will also be monitoring the global investor sentiment. Asian stocks are currently trading slightly lower, but the European Cash Open is yet to take place. If both Asian and European stocks decline, this could potentially back a low-risk appetite, which is negative for the USA500.

The employment data on Friday, reassured investors that the US economy remains strong and resilient to the current monetary policy. The NFP data read 43% higher than market expectations and average salaries rose more than the previous month. On the one hand, the data is positive as it indicates demand will remain high as will company earnings. However, on the other hand, if inflation also rises, the Fed will be unlikely to adjust interest rates.

Therefore, Wednesday’s Consumer Price Index will be key. If inflation reads higher than 3.4%, the stock market can come under immense pressure as the Fed are likely to become more hawkish. This is something which can already be seen from today’s rise in bond yields. The US 10-Year Treasury yields added 0.050% which is known to apply pressure to the stock market. If inflation reads in line with expectations, the release will be neutral. Furthermore, analysts expect the Core Inflation rate to fall from 3.8% to 3.7%.

EURUSD – ECB To Indicate Next Cut!

The Euro is witnessing “mixed” price movement depending on the currency pair. Against the US Dollar the exchange rate is moving sideways, and the key price can be seen at 1.08426. Both the Euro and the US Dollar are likely to witness volatility throughout the week. The Euro due to the European Central Bank’s rate decision and press conference. The US Dollar due to Consumer and Producer Inflation.

Some economists believe the ECB may deem it too early to cut interest rates, but the general opinion is that the time to cut is very near for the ECB. Therefore, investors will closely be monitoring the President’s comments in the press conference on Thursday. The EU’s inflation rate has fallen to 2.4% and is the lowest amongst the G7. In addition to this, many EU economies have been witnessing prolonged stagnation and therefore will be keen to stimulate economic growth. The US Dollar on the other hand will primarily be determined by the CPI and PPI (producer inflation).



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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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

[HFM]

Date: 9th April 2024.

Gold Renews Its All-Time Highs, But Oscillators Point to Caution!


Trading Leveraged Products is Risky

* US indices underperform compared to global stocks as investors await the latest US inflation data.
* Oil is trading almost 22% higher in 2024 applying upward pressure on inflation and triggering a more cautious approach to tomorrow’s Consumer Price Index.
* The US Dollar declines and Gold rises in value despite the possibility of a more hawkish Federal Reserve.
* The head of the Federal Reserve Bank (FRB) of Dallas, Mrs Logan, advises it’s too early to think about lowering interest rates since the danger of inflation stabilizing above the target level remains.

XAUUSD – Buyers Maintain Control but Oscillators Point To The Assets Being Overpriced

The price of Gold trades steadily higher during this morning’s Asian session and is attempting to break yesterday’s all-time high. Gold has risen more than 15% since February 2024 as investors look at an alternative hedge against inflation. In addition to this, many countries including China and India look to lower exposure to the Dollar ahead of US elections. However, investors should note that if US inflation reads higher than expectation, demand for the Dollar may return.

Investors also should note that the inverse correlation between Gold and the US Dollar is slightly weaker than traditionally seen. Therefore, even with a more expensive Dollar, the price of Gold may simply retrace or correct, but retain the longer-term gains. According to Friday’s report from the US Commodity Futures Commission, the number of speculative positions for “sellers” remains weak. The latest report confirmed that only 0.719k more contracts were added for sellers and more than 21.200k added for buyers.



Technical analysis for Gold is two sided. Momentum-based indicators point towards an upward price movement as does price action. However, oscillators indicate the asset may be trading above its intrinsic value and may correct. A short-term correction may decline between 2,292.29 and 2,318.78. For another bullish impulse wave, technical analysts point at a target of 2,376 based on Fibonacci levels and the size of previous impulse waves.

EURUSD – ECB Rate Cut Upcoming According to Analysts

The Euro is gaining momentum since the start of the European Trading session. However, the price is trading slightly lower than the day’s open price. In addition to this, in the short-term the price is forming lower lows and lower highs. When monitoring each currency individually, the US Dollar is trading slightly higher while the Euro is unchanged.

No major economic data has been released in the past 24 hours or is due today. However, volatility is likely to significantly rise from tomorrow onwards. If US consumer inflation reads 3.5% or more, the price of the Dollar is likely to gain. If the monthly producer inflation on Thursday also reads higher than 0.3%, this will further fuel a potential bearish impulse wave.

However, another key factor will be the European Central Bank’s Rate Decision and Forward Guidance. If the ECB suddenly become more dovish, as analysts believe, the Euro may again struggle to hold onto its value, if the Fed are unlikely to adjust. Currently there is more pressure on the ECB to cut interest rates considering inflation has returned to normal levels amongst most state members and most countries are witnessing stagnation. Analysts currently expect the European regulator to be the first to cut interest rates and believe this will take place in June.



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
HMarkets

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: 10th April 2024.

The Fed Is Willing To Lower Expectations To Only 1 Cut In 2024!



* European defence stocks tumble and see the largest decline in 18 months as Goldman Sachs analyst warns the category is trading above its true value.
* US Treasuries Yields and the US Dollar Index remain unchanged as investors hold their breath ahead of today’s inflation release.
* Analysts expect US inflation to increase from 3.2% to 3.4%, but for Core inflation to decline to 3.7%.
* Federal Reserve President of the Atlanta bank, Mr Bostic, advises he is willing to adjust the outlook to only 1 rate cut in 2024. Keep reading to find out why and what the requirements will be.

GER40– Defence Stocks Overvalued According to Goldman Sachs

The DAX as well as general European Indices came under pressure from comments from a market respected analyst. According to the Goldman Sachs Analyst, Victor Allard, shares in European defensive stocks were trading above their true value and have little potential for further gains. As a result, stocks such as Rheinmetall AG, BAE Systems and Saab AB witnessed sharp declines. Saab AB stocks fell almost 10% within a single session.

However, the sentiment towards European stocks were dampened as a result of this. The main reason for Mr Allard’s view is the stock ratios do not back the growth. A good example of this is the price to earnings which is extremely high. Furthermore, Allard pointed out that defence stocks trade now at nearly 20 times forward earnings.

When monitoring the top 7 stocks which hold the highest weight within the index, the market can see a clear sign of profit taking. Five of these stocks have risen more than 10% in 2024 so far, which is higher than traditional gains, but over the past five days a large portion of that has been lost. The only stock which has seen strong gains and has maintained its momentum is Mercedes Benz which has risen almost 22% in 2024 so far. The most important stocks for the index during this earnings data will remain SAP SE, Siemens AG and Allianz.



The price of the index will now largely depend on tomorrow’s European Central Bank press conference and statement. Investors are keen to see when the ECB and Federal Reserve are likely to cut interest rates. If the regulator takes a more dovish approach, the economy is likely to witness much needed stimulation and investor sentiment towards the region is likely to rise. In addition to this, the Euro can potentially make indices cheaper to buy. As a result, this can support the DAX as well as other European indices. In the meanwhile, this afternoon’s US inflation data will be the key price driver for all assets.

USA100 – Price Performance Dependent on Fed Rate Adjustments and Today’s CPI!

The performance of the USA100 will primarily be dependent on this afternoon’s inflation data. However, technical analysts have been keen to point out that the US stocks have been unwilling to form strong longer-term declines. Nonetheless, higher inflation potentially can trigger a lower risk appetite and lower demand for equities. Particularly investors will be looking to see if inflation reads higher than the 0.3% expectations, including the Core CPI.

Later within the evening, investors will also be closely monitoring the FOMC Meeting Minutes for clues as to where the committee stand on possible interest rate cuts. This week Mr Bostic has already advised he would be willing to lower expectations for future cuts if inflation does not allow the Fed to act. According to Mr Bostic, he could consider lowering possible future adjustments from 3 cuts to only 1 for 2024. However, Mr Bostic said this was only possible if inflation stabilized above the target and the employment sector remains resilient. So far, jobs growth remains and it’s all dependent on inflation.



Technical analysis for the USA100 is signalling neither a sell or buy. The price is trading slightly higher than the 75-Bar EMA and at the 55.00 mark on the RSI. However, the price is forming a horizontal price range this morning. Therefore, for a buy signal to be confirmed, the price will need to form a bullish breakout and ideally inflation will not beat expectations.

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

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

Click HERE to access the full HFM Economic calendar.

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

Click HERE to READ more Market news.

Michalis Efthymiou
Market Analyst
HFMarkets

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