Hotforex – Daily Market Analysis

HFblogNews

Active member
Date : 30th December 2020.

FX Update – December 30 – USD slips again.


You must be registered for see images


AUDUSD, H1

The USDIndex posted down to 89.65 earlier, close to the 32-month low from December 17 at 89.62, before recovering to 89.80 in low volume trading. EURUSD concurrently printed a 32-month high at 1.2295 before turning back to 1.2255, and USDJPY saw a nine-day low, at 103.26, and remains below 103.30. The pair’s near-10-month low, seen on December 17th, is at 102.88. The Australian and New Zealand Dollars posted respective 30- and 32-month highs against their US peer. AUDJPY and NZDJPY also saw new trend highs. The Canadian Dollar also traded firmer, but remains comfortably below recent trend highs. Oil prices remain in a consolidation, below recent near-nine-month highs. Base metal prices also remain off recent trend highs. The Pound recouped some of the declines seen over the last couple of days, with Cable lifting to a two-day high at 1.3357. The pair’s 31-month high, which was seen before Christmas, is at 1.3626. EURGBP concurrently ebbed to a two-day low at 0.9055.

You must be registered for see images


Intra-day the AUD is the strongest and the USD and CHF are the weakest. AUDUSD holds at 0.7650 around R2, up some 0.56%, and AUDCHF trades up over 0.69% at 0.6768 from last night’s close at 0.6718.

You must be registered for see images


Later today there are US pending Home Sales which are projected unchanged in November at 128.9, after falling -1.1% in October from 130.3 in September. The only other key data point is the Chicago PMI index which is expected to slip further to 57.0 in December after dropping -2.9 points to 58.2 in November. This would be a third straight monthly drop. Most of the regional PMIs have declined on the month amid the surge in virus cases and increasingly stringent lockdowns. The index was at 48.2 a year ago.

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.

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

Active member
Date : 31st December 2020.

Market Update – 2020 Day 366 – More grief for the Greenback.


You must be registered for see images

USDIndex, Weekly
My diary tells me it’s day 366 of 2020. I started my WFH campaign on March 11, when the USDIndex was trading at 96.40 and on its way to 103.80 by March 23. Today, as we close an unprecedented year, the USDIndex has posted another major-trend low, at 89.51, a level last traded in April 2018.

You must be registered for see images


The Dollar has continued to correlate inversely with global stock market direction, with weakness today being concomitant with the MSCI Asia Pacific rising to a new record high in holiday-thinned conditions. The USA30 yesterday closed at a fresh record high on Wall Street. Oil and other commodities have, in contrast, remained directionally subdued. EURUSD remained buoyant on dollar weakness, although has so far remained just off from yesterday’s near-33-month peak. USDJPY remained heavy, though above yesterday’s two-week low at 102.96. Cable trades healthily above 1.3600 at 1.3660 in low, low volume trading. Both the Australian and New Zealand Dollars, which are living up to expectations for being outperformers in post-Covid recovery trade, rallied to fresh 32-month highs against the US Dollar. USDCAD edged out a 13-day low at 1.2734. The lack of direction in oil prices over that last 10 days or so has rendered the Canadian Dollar the underperformer of the dollar bloc pack.

You must be registered for see images


Oil prices re-entered pre-Covid crisis ranges in recent weeks, while a combination of increasing OPEC and non-OPEC supply swelled global inventories, and demand-sapping Covid lockdowns and restrictions across many major economic areas in the northern hemisphere have taken the legs out of the bull trend.

You must be registered for see images


Elsewhere, Bitcoin rallied to yet another record peak north of $29,000. Cryptocurrencies look likely see much more upside amid signs that long-term institutional investment managers have been buying and holding bitcoin and other leading cryptocurrencies as an inflationary hedge. Assets held by Grayscale Investments, the world’s biggest crypto asset manager, is widely cited as a bellwether indicator of this, as it allows professional investors exposure to crypto currencies without having to store the assets. Grayscale reported yesterday that it had $19 bln in crypto assets under management, up from $16.4 bln last week.

You must be registered for see images


European stock markets are lower – those that are open – with the UK100 down -1.3%, and the IBEX -0.5%. The 10-year Gilt yield is down -0.8 bp at 0.202%. A very quiet day with many European markets already closed for the extended New Year weekend. Many will be happy to leave a difficult year behind, but as vaccination programs continue it is becoming clear that it will take a while before they really have an impact. For now case numbers in many European countries still look pretty bad and it is likely to stay that way for another week, as caution was relaxed over the holiday period. European stocks are pretty near record highs as the year ends as there are also companies benefiting from stay-home orders and investors look ahead to the expected recovery in 2021.

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.

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

Active member
Date : 4th January 2021.

Focus on the Data, but Politics Still in Play.


You must be registered for see images


After last week’s focus on US stimulus, Brexit, vaccine roll outs, virus worries, and lockdowns, attention will turn back to fundamentals with heavy data slates around the world. However, politics will still be an issue near term. On the immediate radar are the runoff elections in Georgia which will determine control of the Senate, which in turn will set the legislative agenda for Congress. In the UK, it will be adjustment time after leaving the EU single market, with many Brexit details still to be worked out. Asia’s economic data should continue to reflect the strength of the recovery even at a slightly more moderate pace.

It’s back to work for US markets, kicking off 2021 after the USA30 and USA500 closed out 2020 at record highs. Combined, the major indexes posted 102 fresh peaks through the year. Compared to March lows, the USA30 was 64% higher, the USA500 up 67% and the USA100 a remarkable 88% firmer. Moreover, the rally saw a further broadening of gains as shares of firms that would benefit from a return to normal saw continued buying interest. Concurrently, yields richened in the few weeks leading up to year end after the 10-year and 30-year rates failed to eclipse 1% and 1.75% levels, respectively.

You must be registered for see images


Wall Street and global stock markets added to already impressive gains in December, fueled by the rollout of vaccines that are widely seen as driving a robust recovery in 2021 after the volatile path seen in 2020. Adding to the optimism was the passage of a fresh stimulus bill in the US and a Christmas Eve Brexit agreement. The accumulation of upbeat developments continued to overshadow the challenges facing the economy in the very near term, as surging infections triggered increasingly stringent lockdowns in the US, Europe and parts of Asia, suggesting a rocky start to the year for global growth. Meanwhile, bond markets continued to take a more measured view of the growth outlook, as the uptick in yields since March has sharply undershot the magnitude of the upward trajectory in equities. The tension between dismal near term and sunny medium term outlooks will continue to drive volatility in equity, bond and currency trading as the New Year begins.

You must be registered for see images


Vaccines rolled out in the UK, US and Europe during December, providing the market with a light at the end of the tunnel as infections, hospitalizations and restrictions soared. Front line health care workers and the elderly have priority, but expectations have grown that wider availability will be the case by the middle of the year, if not a bit earlier. Japan will begin to vaccinate in late February, according to a Bloomberg report that cited local media sources.

Meanwhile, President Trump signed a $2.3 tln omnibus spending bill as the month of December came to a close, averting a partial government shutdown and funding the government through September. More importantly for the market, the bill includes $900 bln pandemic relief measures that will add PPP funds, boost extended unemployment benefits and the eviction moratorium, support the airlines, and increase money for vaccine distribution. The bill provides $600 checks to individuals. Congress indicated it would review Section 230 which advantages big tech, and will look into voter fraud issues.

There are a number of key economic reports on tap this week, including ISMs and vehicle sales, though culminating with the December employment data. The Fed is back in focus too with the FOMC minutes and Fedspeak due.

The December jobs report should garner extra attention given the non-trivial risk of a drop in payrolls as restrictions ratcheted up on the spikes in virus infections since November and the delayed stimulus. Of course, the service sector again suffered the brunt of the restrictions, but that sector has already been hollowed by the spring shutdowns, so weakness may be tempered. Hence, a 100k December nonfarm payroll increase is expected, after gains of 245k in November, 610k in October, and 711k in September. We also note that initial claims are not flashing warnings signs about employment in December — claims fell -19k to 787k in the Christmas week, extending the -86k plunge to 806k in the prior week. The jobless rate should tick up to 6.8% from 6.7% in November, versus a 14.7% peak in April. Average hourly earnings should increase 0.2%.

Fed policy will be on view again after the holiday hiatus. The FOMC released the minutes to its December 15-16 meeting the results of which were uneventful as the 0% to 0.25% rate band was maintained, and there were no changes to QE. However, the minutes will be scrutinized for insights into the general thinking of policymakers. Note there is a new voting rotation this year, and the new crew of Evans, Bostic, and Daly will tilt to the dovish side, with just Barkin more of a centrist. And Fedspeak this week will include the aforementioned doves. Also on tap are Williams, Mester, Harker, Bullard, and VC Clarida.

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
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

Active member
Date : 5th January 2021.

Market Update – January 5 – Georgia on everybody’s mind.


You must be registered for see images


USDCAD, Oil & Gold

The Dollar has been trading steadily so far today after yesterday rebounding quite sharply from 33-month lows. This has come amid a backdrop of sputtering stock markets, with narratives ascribing today’s two runoff elections in Georgia, which have existential implications for the incoming Biden administration (as the result will decide whether Democrats or Republicans will control the Senate), alongside the constant rise in positive Covid tests and associated restrictions, as providing excuses for markets to correct.

The USDIndex has settled above the trend low seen yesterday at 89.42. EURUSD has concurrently settled lower, in the mid-to-upper 1.2200s, after yesterday foraying above 1.2300. USDJPY has settled around 103.0, and the Pound ebbed modestly lower as market participants continue to digest the UK-EU deal. The Aussie and Kiwi Dollars are showing gains over 0.5%, but remain below their respective highs from yesterday.

You must be registered for see images


The Canadian Dollar, meanwhile, recouped some of the ground it lost yesterday during a sharp drop in oil prices. Oil prices steadied today after yesterday seeing a sharp correction after posting 11-month highs, which in our view shouldn’t have been too surprising, what with the demand destruction being caused by the increasing Covid lockdown measures being taken in Europe and other major northern hemisphere nations, alongside increasing supply from both OPEC and non-OPEC producers, and with crude prices having already returned to pre-pandemic levels. USOil lifted back above $48.00 to $48.50 after tumbling by just over 5% from yesterday’s high at $49.80, just shy of the key $50.00. USDCAD rebounded by over a big figure from the 33-month low the pair saw yesterday, at 1.2664, though has since dropped back around the 1.2750 area. Bitcoin has settled after whippy price action yesterday, and remains over 8% down on its record high, as GOLD tests $1950.00, an area last visited November 9th, the day the yellow metal lost over 7%.

You must be registered for see images


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
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

Active member
Date : 6th January 2021.

Europe and UK risks after the deal.


You must be registered for see images


The last two weeks were thin on data and full of trading holidays, but the last minute agreement on a Brexit deal and virus developments were key events and will be decisive for growth and central bank policy over the next months at least. The Brexit deal secured frictionless goods trade, but didn’t cover financial services, which has already led to some shifts. The sharp rise in Covid-19 case numbers over the holiday period and the resulting tightening and/or extension of restrictions meanwhile will put fresh pressure on economic growth and thus keep economies reliant on fiscal and central bank support.

A Brexit deal materialized on Christmas Eve, and has since been ratified by the UK parliament and unanimously approved by all 27 EU ambassadors. The deal took effect on January 1, and in the Eurozone is operating on a provisional basis until the EU parliament formerly ratifies it. The new “Trade and Cooperation Agreement” provides tariff and quota free trading of goods between the EU and UK. For fishing there are transitional arrangements, but in general EU law will cease to apply in the UK, and the jurisdiction of the European Court of Justice will end. The biggest hurdles to a deal being reached were the level playing field rules and state aid issues, which were overcome with the principal of “managed divergence”, which gives both sides the right to a review and retaliation mechanism if they believe the other side has gained an unfair competitive advantage.

Financial services are still in limbo though, despite the trade deal. The agreement struck between the EU and the UK, last week ensured tariff and quota free trade in goods, but the UK’s important financial services industry still doesn’t have clarification on what exactly will change in the future, as the deal doesn’t cover financial services. Some area are covered by “equivalence” assessments, but not all. Both sides hope to get a memorandum of understanding in place by the end of March, but that won’t be as high profile and extensive as the trade deal. Britain’s Financial Conduct Authority was forced to announce last week that it would temporarily alter its rules to ease fears of market turbulence in interest rate swap trades at the start of this year. The EU has so far not granted equivalence to the UK market to help smooth cross-border transactions and the FCA will temporarily allow London-based branches of European investment banks to trade on EU venues, as long as they are trading for EU clients. The relief will not apply to the firms’ trades on behalf of non-EU clients or their own proprietary trades and the measure will be reviewed on March 31.

Share trading is also shifting and with companies not really expecting equivalence rulings to materialise may were prepared with big shifts reported for yesterday’s trade. An (paywall) highlighted that on the first trading day of 2021 “nearly €6bn of EU share dealing shifted away from the City to facilities in European capitals”. This may not be the city’s biggest area of revenue, but it may give a flavor of what is to come. The FT also highlighted that EU regulators yesterday “withdrew registration of six UK-based credit rating agencies and four trade repositories — data warehouses that provide authorities with information on derivatives and securities financing trades. EU companies and investors will now have to use EU-based entities.”

Meanwhile, the UK is back in the strictest lockdown since March last year and despite the rollout of vaccines, it may don’t expect restrictions to be lifted before the end of February. Germany is also extending its lockdown, with the hospitality sector and non-essential shops already closed for a while and now set to remain shut until the end of the month at least. Under discussion are also further restrictions of movement in areas were incident rates are particularly high. It may be the result of the new and more infectious virus mutation, or just the natural result of a more relaxed attitude over the holiday period, but it is clear that vaccination programs will take a while to have sufficient impact to get economies back to normal.

Against that background data releases looked already out of date.

The final December UK manufacturing PMI may have been revised slightly higher, to a 57.5 headline in the final reading yesterday, but like the German numbers the data already look outdated considering subsequent developments.

German jobless numbers came in better than expected in December readings released today, with the sa unemployment total unexpectedly falling -37K over the month, despite the tightening of lockdown restrictions last month that saw restaurants, hotels and non-essential shops close once again. Expectations had been for a rise in the jobless total as well as the jobless rate, but in the event the sa rate remained steady at 6.1%. However, the fact that official numbers haven’t exploded is largely due to government wage support and job retention schemes, which have helped companies to hang on to staff. That is a costly exercise and not all companies will survive once government support ends and the ECB also starts to tightening policy. That means the real impact on the labour market from the pandemic will only become apparent over time and much later in the year.

ECB waiting for fiscal stimulus after extending PEPP & Brexit deal takes pressure of BoE

The EU has finally cleared the next medium term budget and with it the pandemic recovery program that will be jointly financed and should go some way to get the economy back on track. In the best case scenario, the ECB is pretty much on hold for now, although clearly if there is Brexit chaos or the virus situation doesn’t improve, ECB officials will be ready to step in with additional measures.

Meanwhile in UK, developments could also lead to renewed speculation that the BoE will have to step in again, although the Brexit deal removed any immediate pressure on the central bank to consider negative rates. The BoE’s Monetary Policy Committee left official rates unchanged at the meeting in December, but extended the Term Funding Scheme by six months, while focusing on flexibility in the asset purchase program. Should market functioning worsen materially again, the Bank of England could increase purchases, but at the same time, there is flexibility to slow the pace of purchases later if the economy recovers as planned next year. Fiscal policy is already stepping in again to get companies and employees through this latest crisis and clearly with the budget deficit rising sharply BoE support will be needed to keep financing conditions favourable, even in the best case scenario.

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
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

Active member
Date : 7th January 2021.

Big Surprise from Germany & US data Preview.



EURUSD, H4
German manufacturing orders jumped 2.3% m/m in November, which unexpectedly continued the pretty impressive rebound that the sector has seen since the last lockdown. Expectations had been for a slight correction from the 3.3% rise in October, but in the event the inflow continued at a robust pace, with domestic orders rising 1.6% m/m and foreign orders 2.9% m/m. The annual rate is now at 6.4% y/y – based on the seasonally adjusted series, and thus clearly above pre-virus levels. This is of course data that preceded the latest lockdown, although it is expected that the renewed tightening of virus restrictions won’t hit production too much, even if it means further hardship for the services sector. The latter also means that there still is the risk of a technical recession despite the impressive orders number. Indeed, part of the surge in orders may be due to precautionary stock building in the UK ahead of the official Brexit date and that could mean a drop back in orders at the start of this year as companies reduce stockpiles.

US Initial jobless claims preview: Initial claims are expected to slip -7,000 to 780,000 in the week ended January 2 after a -19,000 drop to 787,000 from 806,000 at the end of December. Claims have been elevated in recent weeks amid the surge in virus cases and the more stringent lockdowns have seen renewed layoffs. Additionally, the holidays have been distorting. Remember, seasonal adjustments were switched in September, and the usual seasonal rise in NSA claims through the holidays may be lifting the reported SA data given the unusually high level of claims. Claims are expected to average 835,000 in December, following averages of 749,000 in November, 786,000 in October, and 855,000 in September. The 892,000 December BLS survey week reading exceeded recent survey week readings of 748,000 in November, 797,000 in October, and 866,000 in September. Expectations are still for a December payroll rise around 100,000 though risk is for a weaker print, and potentially a decline, (Barclays have a -50,000 figure) especially given the -123k decline in the ADP report yesterday.

US trade balance preview: the deficit is expected to widen to -$67.2 bln in November, a 14-year high, after edging out to -$63.1 bln in October, and was at a 12-year high of -$64.9 bln in August. We expect exports to increase 0.7% to $183.2 bln, while imports rise 2.2% to $250.4 bln. The November petroleum price rebound has likely boosted both exports and imports of petroleum. We saw November pull-backs in vehicle trade after huge increases in every month since June, but large declines in each prior month since February. We expect a sustained high November bilateral goods deficit between the US and China of about -$30 bln as businesses rebuild inventories. For the year, we expect a -$55.9 bln average deficit, versus a -$48.1 bln average in 2019.

US ISM services index preview: we expect the index to dip to 55.0 in December. This would be a third straight monthly decline as service sector activity slows, especially with the delayed stimulus, the surge in virus cases and renewed shutdowns. The index had surged to 58.1 in July, an 11-year high, amid reopenings of the economy. It was at 54.9 last December. Producer sentiment has remained firm despite the fall’s moderation as businesses scramble to rebuild inventories.

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.

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

Active member
Date : 11th January 2021.

Events to Look Out for This Week.



2021 has started and even though it is set to be far better than 2020, January remains as stormy and volatile as its predecessor. In the week ahead, the markets are expected to continue to buy into the recovery story. In regards to data, this will be a week of increased attention to the global inflation releases and production numbers out of the UK and China. The markets also remain focused on potential further lockdowns and tighter restrictions.
Monday – 11 January 2021

  • Consumer Price Index (CNY, GMT 01:30) – China’s recovery broadened further, as manufacturing sentiment measures were firm and a key non-manufacturing sentiment measure remained elevated. CPI is expected to accelerate to in December as well with a 0.1% y/y pace in December following the 0.5% decline last month.
  • BoE’s Governor Bailey speech (GBP, GMT 15:00)
Tuesday – 12 January 2021
  • BoE’s Broadbent speech (GBP, GMT 10:00)
  • Fed’s Brainard speech (USD, GMT 14:35)
  • Fed’s Rosengren speech (USD, GMT 19:00)
Wednesday – 13 January 2021
  • Consumer Price Index (USD, GMT 13:30) –The December inflation reports should reveal a big energy-led gain for CPI with a moderate core price rise, and big increases for 0.4%m/m growth which would result in a 1.3% headline y/y increase.
Thursday – 14 January 2021
  • Imports and Exports (CNY, GMT N/A) – Consumer demand picked up and exports also climbed, as trade flows resumed after the weakness in Q2 in China. This is expected to be confirmed also in December’s release as imports expected to raise by 0.5% and exports by 15%.
  • Initial Jobless Claims (USD, GMT 13:30) – Initial jobless claims for the week of January 9 should remain elevated, though a -17k down-tick in the weekly pace to 770k has been assumed, after a -3k drop to 787k from 790k. Seasonal adjustment for initial claims was switched to being additive from multiplicative in September, and the usual seasonal rise in NSA claims through the holidays may be lifting the reported SA data with the new seasonal factors given the unusually high level of claims. We are likely also seeing a lift from expanding coronavirus restrictions.
  • Fed’s Chair Powell speech (USD, GMT 17:30)
Friday – 15 January 2021
  • Gross Domestic Product (GBP, GMT 00:30) – UK nations have gone into a ‘tier 5’ lockdown, the most restrictive level since the full lockdown of spring last year, although manufacturing, auto repair businesses, DIY and garden stores, remain open, along with food sellers. High street retail, aviation and other public transport, along with the hospitality sector, are bearing the brunt of the lockdown, as in other nations, although the percentage impact on GDP from these sectors being closed is bigger in the UK than most peers. The UK saw a bigger peak-to-trough GDP contraction than any other G20 nation in 2020 as a consequence of the national and global countermeasures taken to table Covid-19. With UK in lockdown season since November, November’s GDP figure expected to present a severe decline to 4.0% m/m with Manufacturing and industrial production at 0.7% m/m and 0.4% m/m respectively from 1.7% m/m and 1.3% m/m in October.
  • US Retail Sales (USD, GMT 13:30) –A -0.2% December retail sales headline dip is forecasted with a -0.4% ex-autos decline, following respective November decreases of -1.1% and -0.9%. Unit vehicle sales rebounded in December, and this should support the auto dealer component. Typical strength is being undermined by rising coronavirus restrictions during the holiday shopping season.
  • Producer Price Index (USD, GMT 13:30) – A 0.2% December PPI headline rise is anticipated with a 0.1% core price gain, following gains of 0.1% for both in November. As expected readings would result in a y/y headline PPI metric of 0.6%, down from 0.8% in November. A rebound in energy prices should boost the headline. Oil prices are rebounding after a fall pause and a bottom in April, thanks to a better supply-demand balance in the petroleum sector, and supply constraints for some sectors should remain problematic into Q1.
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
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

Active member
Date : 12th January 2021.

Market Update – January 5 – Georgia on everybody’s mind.


Trading Leveraged Products is risky
FX News Today
USD continues to bounce (Day 5), and Yields up significantly as virus worries escalate and political uncertainty swirls. Democrats lodge papers to impeach President Trump if the cabinet doesn’t act to remove him. Neither of which are likely to come to fruition but the symbolism is significant. Equities lower (TSLA -7.82% & TWTR -6.4%), Asian markets mixed (Japan flat). Bitcoin crashed 20% before recovering 50% of loss, Oil recovered & Gold remains pressured by strong Yields. Overnight – weak Japanese bank lending and the worst UK Retail Sales figures since 1995, +4.8% vs 5.9% & 7.7% in Dec.

USDIndex – 5th day higher from 33-mth low (89.15) and back over 90.00 but struggled over at 90.70 at 2-day high. Trades at 90.40 – PP 90.30 – S1 90.15, R1 90.65

EUR – 4th day lower – trades under 1.2200 (R1) – 1.2130 (S1) yesterday, for a 18-day low, back to 1.2160 now– PP – 1.2180. 3 Black Crows on Daily Chart completed.



JPY –
5th day higher but stalled ahead of 104.50 (R2) yesterdayTrades at 104.12 (PP), R1 104.30, S1 103.92

GBP – down to 1.3450 (S1) yesterday. Back over 1.3500 and over R1 at 1.3555. PP 1.3510, R2 & 200Hr MA 1.3585

AUD – Under 0.7700 yesterday to test 0.7660 – back to PP now 0.7725 – R1 0.7750, NZD – Down to 0.7150 yesterday – back to PP 0.7180, R1 0.7210 CAD 1.2835 high yesterday – trades at 1.2745 (PP & 200MA)R1 1.2800 CHF – Trades at 0.8900 – up from 3 yr lows on Wednesday at 0.8757. PP 0.8850

BTC – Major Volatility yesterday –
plunged 20%+ to $29,800. Retraced over 50% of fall – Back to around $36,400.

GOLD – Tested 1820 as Yields rose – Trades at 1858 now, PP 1840 USOil – $52.70 high Fridaytrades at $51.60 (R1) nowstill elevated, after dip to $51.50.

USA500 – Closed down 25 (-0.66%) 3799 – USA500 FUTS now at 3805. 47 days north of 20SMA (3735).

Today – US NFIB Business Optimism, EIA STEO, BoE’s Broadbent, Fed’s Brainard, Kaplan, Mester, Rosengren, ECB’s de Cos

Biggest (FX) Mover @ (07:30 GMT) NZDCHF (-0.40%) Bounced from 200MA on open. Breached PP (0.6384) earlier and tested R1 (0.6400). Fast MAs aligned and trending higher, RSI 57 and rising, MACD histogram & signal line aligned higher but remains south of 0 line this morning, Stochastics rising to OB. H1 ATR 0.0007, Daily ATR 0.0050.

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.

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

Active member
Date : 13th January 2021.

FX Update – January 13 – USD & Yields stall their run, Politics swirls.



FX News Today
USD reversed its 5 day run as Yields stalled too. House vote tonight to impeach President Trump, (YouTube have banned him for 7 days), Pence will not initiate the 25th Amendment to remove him. The symbolism is significant, no President has ever been impeached twice. Equities flat too (UBER +7.24%,TSLA +4.72%, FB -2.24%, GooGL & NFLX -1.00%) Asian markets also flat. GBP rallied after Bailey pushed back on Negative Interest Rates. Oil rallied over 1% after surprise inventory drawdowns peaked at $53.90, AUD pegged by possible RBA “push back” to strong AUD. Gold recovered $1850.

China reported its largest daily new COVID-19 cases in 5 months.

USDIndex – Back under 90.00 from rejection of 90.50 yesterday. Trades at 89.95 just over S3 – PP 90.40 – S3 89.90, S2 90.07

EUR – Recovered back over 1.2200 (R2) – Trades at 1.2215 now– PP – 1.2157. R3 1.2225 –



JPY –
Reverses under 104.000 – after rejection 104.50 on Monday.Trades at 103.68 (200hr MA). – PP 103.90, S1 103.55

GBP – Big rally – spurred by USD weakness and Governor Bailey pushing back on Negative Interest Rates. Breached 1.3600 after multiple attempts – rallied to 1.3690 – PP 1.3585, R1 1.3668, R2 1.3715

AUD – Over 0.7700 yesterday to test 0.7770 (R2) now. R1 0.7748 – NZD – Over 0.7200 yesterday to test 0.7240 (R3) now. r2 0.7215 CAD – back to test 1.2700 (S2) today as Oil rises – S1 1.2725, S3 1.2664 from Friday CHF – Trades back to 0.8850 (200hrMA) and under S3 (0.8865)- PP 0.8900

BTC –
Back to around $34,600. – PP today 34,500, r1 36,600, s1 32,800

GOLD – Recovers over 1850 (PP) – Trades at 1860 (R1) – R2 1875, PP 1840 USOil – New 11-mth high $53.90 (R2) after surprise drawdown in private inventories (EIA data later). R3 $54.70, r1 53.55.

USA500 – Closed up 1.5 (+0.04%) 3800 – USA500 FUTS now at 3808. 48 days north of 20SMA (3740).

Today – EZ industrial production, US CPI, ECB’s Lagarde, Fed’s Bullard, Brainard, Harker, Clarida

Biggest (FX) Mover
@ (07:30 GMT) GBPAUD (+0.23%) 5th day higher – Bounced from 200MA on open, testing 1.7625 now, key resistance 1.7650. Fast MAs aligned and trending higher, RSI 59 and rising, MACD histogram & signal line aligned higher and north of 0 line from Monday open, Stochastics rising to OB. H1 ATR 0.023, Daily ATR 0.0125.

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.

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

Active member
Date : 18th January 2021.

Events to Look Out for This Week.



US elections will dominate the markets in the week again, as the inauguration of Joe Biden will take place on Wednesday with security having been stepped up. From data perspective is all about inflation next week from UK, EU, Canada, New Zealand and Japan. However eye will be on central banks with BoC, BoJ and ECB rate decision in the spotlight.
Monday – 18 January 2021


  • Gross Domestic Product (CNY, GMT 02:00) – Gross Domestic Product should advance in Q4 and reveal headline growth of 6.1% y/y and 3.2% q/q.
Tuesday – 19 January 2021
  • Harmonized Index of Consumer Prices (EUR, GMT 17:00) – The German HICP inflation for December is anticipated to remain unchanged at -0.7% y/y. Initial expectations had been for a slight lift in the annual rate, but national data out of Germany already indicated that the number would remain stuck at a very low level. Germany’s temporary VAT cut and base effects from energy prices are largely to blame for the negative rate.
  • ECB Bank Lending Survey (EUR, GMT 09:00)
  • Economic Sentiment (EUR, GMT 10:00) – European January ZEW economic sentiment is seen to have declined at 45.5 compared to 54.4 last month.
Wednesday – 20 January 2021
  • The inauguration of Joe Biden as the 46th President will dominate headlines around the world!
  • PBoC Interest Rate Decision (CNY, GMT 01:30) – The People’s Bank of China in this meeting should provide guidance on the next move in Loan Prime Rates. It is expected to continue to maintain flexibility in the exchange rate, stabilize market expectations, and keep the yuan basically stable at reasonable and balanced levels.
  • Consumer Price Index and Retail Sales Index (GBP, GMT 07:00) – UK inflation data for December is anticipated higher at 0.5% y/y, after falling more than expected, to just 0.3% y/y in November, with the biggest downward contribution coming from food and non-alcohol beverages, along with clothing and footwear. The UK-wide Covid-19 lockdown in November suppressed price pressures. Inflation is likely to remain subdued over the next several months, but should pick up notably from spring, when base effects impact on year-on-year price comparisons. There is potential for pronounced reflation as 2021 progresses, assuming vaccine programs prove effective, which would facilitate a return towards societal and economic normalcy, and in turn trigger a possible consumer spending boom fuelled by ‘lockdown savings’. The Retail sales are seen at 1.1% y/y in December from 0.9% y/y last month.
  • Consumer Price Index (EUR, GMT 10:00) – The final CPI headline and core are expected to show 0.3%m/m December gains, with core declining to 0.5% m/m.
  • Consumer Price Index (CAD, GMT 13:30) – The CPI inflation accelerated to a 1.0% y/y pace in November, however, it is expected to decline in December to 0.8% y/y below the Bank’s target of 2% until 2023.
  • Interest Rate Decision and Statement (CAD, GMT 15:00) – The BoC is expected to hold rates steady at 0.25% after December’s meeting in which extraordinary forward guidance remained in place as anticipated — the bank reiterated that it expects to hold rates at the effective lower bound until “economic slack is absorbed so that the 2% inflation target is sustainably achieved.”
Thursday – 21 January 2021
  • Interest Rate Decision and Statement (JPY, GMT 03:00) – The BoJ is expected to hold rates steady at -0.1% after December’s meeting in which extraordinary forward guidance remained in place as anticipated — the bank reiterated that it expects to hold rates at the effective lower bound until “economic slack is absorbed so that the 2% inflation target is sustainably achieved.” The speculation is growing that the BoJ will scale back its ETF stock buying programme – given the strength in equities and the BoJ’s substantial ownership of this ETF sector.
  • Interest Rate Decision, Statement and Conference (EUR, GMT 12:45) – The ECB to add more stimulus at the moment seems unlikely unless current restrictions remain in place much longer than anticipated. Hence, ECB is expected to keep policy steady at January meeting. The central bank’s focus is on maintaining very favourable financing conditions for both governments and companies, against the background of a pandemic that not only has weighed heavily on the growth outlook, but also contributed a further fragmentation of economies and markets. With the advent of vaccination programs there clearly is no appetite to cut rates again. Not that the ECB rules out such a step — if the situation deteriorates again, or an overshooting currency undermines the inflation outlook, the ECB won’t shy away from using that instrument if necessary.
Friday – 22 January 2021
  • Markit PMI Composite (EUR, GMT 08:30-09:0) – Final December PMI readings brought downward revisions. The manufacturing PMI was revised to 55.2 from 55.5, while the services PMI came in at 46.4, versus 47.3 in the preliminary report, although still up from 41.7 in the previous month. The composite PMI was revised down to 49.1 from 49.8, again still an improvement from the 44.3 reported for November, but no signalling ongoing contraction, rather than the stabilisation the flash reading suggested. Social distancing measures and restrictions continued to weigh on the services sector and while the outlook in December was brightened by the prospect of vaccination programs, it is pretty clear now that restrictions won’t go away any time soon and that despite vaccines it will still be a very difficult winter. That means that while the downturn in overall activity in Q4 was less severe than thought at some point, the outlook for the first quarter looks very difficult and as Market highlighted the risk of a technical recession is greater now.
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
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 raeliable 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

Active member
Date : 19th January 2021.

Market Update – January 19 – USD & Yen Slide.



EURUSD, H1
The Dollar and Yen have come under pressure today after rallying yesterday. A bullish sentiment in global stock markets has boosted other currencies, particularly the dollar bloc and other cyclical units. The MSCI Asia-Pacific Index rose over 1.5% and clocked a new record high, buoyed in the wake of strong GDP and production data out of China yesterday. Europe’s Stoxx 600 fared less well, and was showing a modest 0.2% gain as of the late London morning session. US Index futures were up by over 0.5%. Commodities, in contrast, were lacklustre. Oil prices lifted moderately, rising above Monday’s highs, but remained off the 11-month highs that were pegged last week. Base metal prices were mixed.



The USDIndex dropped below yesterday’s low to a nadir at S3 and 90.36. The index had yesterday printed a one-month high at 90.95. The dollar’s recent correlation with US Treasury yields broke, with the currency declining despite a concurrent 2 bp lift in the 10-year T-note yield to levels back above 1.10%. After rising on every trading day, except one, since January 6th, the Dollar had perhaps been looking ripe for a correction. Of interest, the latest Economist Big Mac index, which is a measure of 56 currency valuations according to the theory of purchasing power parity, shows the Dollar to be the fourth most overvalued currency, behind the Swiss franc, the Swedish krona, and the Norwegian krone. By this measure, the Euro is 9% undervalued relative to the Dollar, and the Pound 22% undervalued. This gives some insight into why the market has been so bearish of the Dollar in the beyond-Covid global reflation trade, which has the dominant macro investment thesis over the last couple of months.

Ahead today, Ex Fed chair Janet Yellen will testify before Congress for her nomination as Treasury Secretary, where she will reportedly call for the US to “act big” on stimulus. Regarding the Dollar, she is expected to argue for market-determined exchange rates. Given the Fed’s inflation tolerant, lower-for-longer rubric on interest rate policy, alongside prospects for sharp rises in the budget and trade deficits, US economic policy under the incoming Biden administration is sure to be accepting of, if not wanting, a weaker Dollar.



EURUSD – breached 1.2100 and trades north of R3 at 1.2144, Cable holds over 1.3600 having tested 1.3625 earlier, and USDJPY continues to rotate through 104.00.

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.

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

Active member
Date : 20th January 2021.

Morgan Stanley – Still the best Equity Trader?




Morgan Stanley is set to report its fourth-quarter 2020 earnings before the market open today. Morgan Stanley is a leading global financial services firm providing investment banking, securities, wealth management and investment management services. Hence similar to the previous three quarters of 2020, the coronavirus pandemic, along with the US presidential election and vaccination breakthroughs clearly impacted the Morgan Stanley report and weighed on markets sentiment especially as in the 4th quarter the second wave of pandemic looks to be even stronger than before. The virus spread created chaos in financial markets that impacted the value of loans, investments and trading assets, and significantly reduced interest income and investment banking fees.

However, fiscal stimulus programs and ongoing monetary support are expected to have helped client activity bounce back in H2 of 2020, leading to heightened volatility. Therefore, today we could see something similar to the JPMorgan report. Morgan Stanley’s equity and fixed income markets revenues are expected to have improved. Additional reasons that could support a positive reading today are the near-zero interest rates and the Federal Reserve’s bond purchase program, as these is likely to have aided Morgan Stanley’s debt underwriting fees, which account for more than 50% of their total underwriting fees. Also, global M&As spiked in the 2nd half of 2020 due to restructuring. Hence Morgan Stanley could benefit from advisory fees incomes.

Nevertheless, according to Forbes and Zacks, Morgan Stanley is expected to earn $1.29/share on $11.08 billion in revenue. This would represent year-over-year growth of 7.5%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $11.28 billion, up 3.88% from the year-ago period.



Technical Analysis
It has been an interesting year for US company shares. Morgan Stanley hit a yearly high of $91.31/share in 2020 while currently trading within the $75-77 territory. The share price is on course for the best performing quarter in Morgan Stanley’s history, since it is a breath away from the 161.8 Fibonacci extension from November’s rally. From the technical perspective, the stock’s outlook is currently bullish however some consolidation has been noticed since December 2020 on the overbought performance seen in the 2nd half of 2020. The price is positioned well above the 200 Day Moving Averages and 50 Day Moving Averages.

The stock is prone to big moves after reporting earnings and could easily gap up if the numbers are strong. Conversely, if the numbers disappoint, the stock could easily gap down.

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
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

Active member
Date : 20th January 2021.

USD Data – Claims Remain Elevated, Housing & Philly Fed beat



EURUSD, H1
US initial jobless claims fell -26,000 to 900,000 in the week ended January 16. This follows the prior week’s sharply downwardly revised 142,000 surge to 926,000 (was 965,000) which was the highest level since late August. But the 4-week moving average rose to 848,000 versus the prior 824,500 (was 834,250). Initial jobless claims (NSA) tumbled -151,300 to 960,700 in the January 16 week after rising 192,300 (was 231,300). Continuing claims dropped -127,000 to 5.054 million in the January 9 week after bouncing 109,000 to 5.81 million (was 5.271 million). The initial claims number will get a little extra scrutiny as it coincides with the BLS employment survey week.

US housing starts climbed 5.8% to 1.669 mln in December, well above expectations, following the 3.1% jump to 1.578 mln (was 1.547 mln) in November. This is the fourth straight monthly increase and is the highest since late 2006. Building permits increased 4.5% to 1.709 mln last month after November’s 5.9% surge to 1.635 mln (was 1.639 mln). All of the strength in starts was in the single family arena, posting a 12.0% pop, while multifamily starts dropped -13.6% following respective increases of 1.4% (was 0.4%) and 9.1% (was 4.0%). And this is an 8th straight monthly gain (since May) for single family starts.

The Philly Fed manufacturing index rebounded 17.4 points to 26.5 in January, much stronger than expected, after dropping -11.6 points to 9.1 (was 11.1) in December. The index has been in expansion since June and was at 13.7 a year ago. Gains were broadbased. The employment index surged to 22.5 from 5.6 (was 8.5). The workweek edged up to 18.6 from 15.5 (was 18.0). New orders jumped to 30.0 from 1.9 (was 2.3). Prices paid nearly doubled to 45.4 versus 24.9 (was 27.1) and prices received increased to 36.6 from 16.1 (was 18.0). The 6-month activity index rose to 52.8 from 43.1 (was 39.2). But the future employment gauge dipped to 38.9 from 41.3 (was 41.0), and new orders were unchanged at 47.5 (December was revised from 41.5). Prices paid slid to 41.3 from 45.1 (was 46.6), with prices received at 33.9 from 34.3 (was 35.5).



The Dollar moved slightly higher after the mostly upbeat data, which saw initial jobless claims fall less than expected, but continuing claims down more than forecast. Housing starts beat expectations, while the Philly Fed index was stronger than consensus. USDJPY traded from near 103.45 to 103.55, while EURUSD initially dipped to near 1.2150 from 1.2165.



Equities have opened higher, all three of the major US indices at all-time highs, the USA100 leads the way to trade at 13,310.

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.

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

Active member
Date : 23rd January 2021.

FX Update – January 22 – USD Holds gains & PMI’s.



GBPUSD, H1
The Dollar has firmed up on a safe haven bid with the reflation trade having come to a firm stop. The USDIndex lifted moderately to a 90.25 high after basing out at a nine-day low at 90.05. The US currency gained only marginally against the Euro and Yen, but racked up gains of around 0.4% to 0.5% against the Pound and dollar bloc currencies. EURUSD ebbed back from an eight-day high at 1.2178, before recovering to 1.2188 following Eurozone PMI data, while USDJPY lifted to a two-day high at 103.70.



Global equity indices corrected from record highs in the cases of the main US indices and the MSCI Asia-Pacific Index. Base metals are also markedly lower. Lofty valuations and an increasing level of concern about the Covid situation have warranted increasing investor caution. Covid restrictions have been implemented across northern China, and the new highly transmittable variant of the SARS-Cov2 coronavirus — aka the British variant, where it was first detected — has shown up as far afield as Beijing and Australia. The EU looks set ban travel to the UK, while the UK has already imposed much tougher international travel restrictions. The rollout of the Covid vaccinations globally has also been proving to be bumpy.

Elsewhere, cryptocurrencies dropped sharply again, which will only add to their reputation for being too volatile for serious institutional investors to touch. Reports that the Biden administration has tighter regulations for cryptocurrencies on its ‘to do’ list have been driving cryptos lower. Bitcoin was showing an 11% loss on the day, as of the early London morning, at $30,860 — which is nearly 26% below the record high seen earlier in the month. The virtual coin earlier traded below $29,000 for the first time since January 1.



Eurozone Flash PMI readings declined as lockdowns were strengthened and/or extended. The last minute Brexit deal may have helped to prevent a worse number for the manufacturing sector at least, and the decline in the Eurozone manufacturing reading to 54.7 from 55.2 was actually less pronounced than feared with the number still pointing to a solid pace of expansion. Services meanwhile are clearly suffering. The Eurozone services PMI dropped back to 45.0 from 46.4, driven largely by a sharp deterioration in the French reading, which fell to 46.5 from 49.1. The German index held up better than feared and dipped only slightly – to 46.8 from 47.0. The overall composite for the Eurozone came in at 47.5, down from 49.1 at the end of last year and supporting expectations for a technical recession over the Q4 and Q1 period.



Across the Channel UK PMI data showed a woeful record for Services and came in much weaker than expected. The headline composite PMI plunged to 40.6 from 50.4 in December. The median forecast had been for a 45.5 reading. Pronounced weakness in the service sector drove the composite lower, with services bearing the brunt of the lockdown across the UK nations, which has been the most severe since last year’s ‘mother’ lockdown. The prelim services PMI headline dove to 38.8 from 49.4. The prelim manufacturing PMI fell to a headline reading of 52.9 from 57.5, which was near the median forecast for 53.0. Much of the manufacturing sector remains open, despite the lockdown. The drop in the composite reading, while sharp, is still less much less severe than was seen during early spring last year. There are hopes that the UK’s world-leading vaccination programme will start to see restrictions lifted from as early as mid February, by which time all the most vulnerable groups should have been vaccinated.

Cable trades down to test 1.3650, down from yesterday’s high at 1.3745 and today’s open at 1.3729.

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.

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

Active member
Date : 25th January 2021.

Events to Look Out for This Week.



A gigantic week is coming with 2 of the FAANGs, Tesla and Microsoft, reporting their Q4 earnings, along with the FOMC conference in focus as it could provide key information on fiscal support talks. Focus will also be on GDP data from the biggest economies in the world, including the US and Europe, but also on UK Job numbers that will show the impact of the original furlough deadline.
Monday – 25 January 2021

  • German IFO (EUR, GMT 09:00) – German IFO business confidence is expected to slip slightly to 90.0 in January after the jump seen in December to 92.1.
  • BoJ Monetary Policy Meeting Minutes (JPY, GMT 23:50) – The BoJ minutes should provide further guidance for 2021.
Tuesday – 26 January 2021
  • Average Earnings Index & ILO rate (GBP, GMT 07:00) – UK Earnings with the bonus-included figure are expected to slow down to 2.3% y/y in the three months to November. UK ILO unemployment is expected higher at 5.1% in the three months to November.
  • Consumer Confidence (USD, GMT 15:00) – The US Consumer confidence is expected to slip to 88.0 from 88.6 in December, versus a 6-year low of 85.7 in April. The confidence measures have shown divergent swings since mid-2020 that have a downward tilt into January, likely due to the surge in virus cases, more stringent lockdowns, and the bizarre political events of recent weeks. We should be seeing some lift from stimulus passage and vaccine distributions, however, which may be more evident in February.
Wednesday – 27 January 2021
  • Consumer Price Index (AUD, GMT 00:30) – Australian inflation data in Q4 is expected to decline at 1.5% q/q while headline remains in line with Q3 at 0.7% y/y.
  • Durable Goods (USD, GMT 12:30) – Durable goods orders are expected to rise 3.0% in December with an 8.3% climb in transportation orders. A defense orders gain is pegged at 3.0%, following a 3.7% November bounce. Boeing orders jumped to 90 in December with the lifting of the 737 MAX grounding, from 27 in November and zero in the two months before that. Durable shipments should rise 1.0%, and inventories should rise 0.5%.
  • Interest Rate Decision and Conference (USD, GMT 19:00) – The FOMC is due to meet (Tuesday, Wednesday) but no changes are expected. The FOMC didn’t make any big changes in its policy stance at the December 16 meeting. However, it did tweak its statement to emphasize its uber-accommodative posture, which was underscored several times by Chair Powell in his press conference. The forecasts indicate that current rates will remain in place through 2023.
Thursday – 28 January 2021
  • Harmonized Index of Consumer Prices (EUR, GMT 13:00) – The German prel. HICP inflation for January is anticipated to be released at -0.6% y/y from -0.7% y/y. Germany’s temporary VAT cut is partly to blame as are base effects from oil prices, but it is also clear that a lack of demand and the closure of the hospitality sector continue to keep a lid on headline inflation numbers.
  • Gross Domestic Product (USD, GMT 12:30) – The prelim. Gross Domestic Product should advance at 4.1% in Q4 and 3.2% in Q1, after 33.4% growth in Q3. We expect a Q4 moderation in consumption growth to 2.2% from 41.0% in Q3 as heightened coronavirus restrictions impacted spending, while government purchases contract at an estimated -5% rate, and nonresidential investment in structures fall at a -9% pace. We saw in Q3 a continued boom in housing activity and equipment spending.
Friday – 29 January 2021
  • Gross Domestic Product (EUR, GMT 09:00) – Eurozone’s GDP contracted -5.0% last year, according to the first estimate for economic activity last year. That compared to a modest rise of 0.6% in 2019 and while it was somewhat better than median expectations, the numbers refer to unadjusted data. Adjusted for calendar effects, GDP was actually down -5.3%. There is no data for the last quarter yet, but it is pretty clear that after the recession in the first quarter and the rebound over the summer, virus developments weighed on growth again in the last quarter of 2020, although less than feared at one point.
  • Personal Income/Consumption (USD, GMT 12:30) – A 0.1% increase in headline rise for personal income in December is anticipated after a -1.1% drop in November, alongside a -0.7% drop in consumption after a -0.4% November decline.
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
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 raeliable 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

Active member
Date : 26th January 2021.

FX & Market Update – January 26.



FX News Today
USD & JPY stage a wee comeback. US Equities had a very volatile day – (Huge surge in Options trading) US Futures down and Asian markets weaker – amid fears of a delay in stimulus programs and warnings of asset bubbles in China weighed. In Europe, virus developments remain in focus with clear signs that lockdowns are working in new infection numbers, but worries about the impact of virus mutations and in the EU dissatisfaction with the slow rollout of vaccines. Yellen confirmed as Treasury Secretary, Trump impeachment passed to the Senate, Italian PM Conte quits and NZD & China sign new trade deal.

This weekFED on Wednesday, GDP from EU & US and a big week for US Earnings – FB, Microsoft, Tesla, Apple and DAVOS goes on-line.

USDIndex – Holds over 90.00. Trades to 90.50, – PP 90.30 R1 90.55, R1 90.70
EUR – Back to 1.2115 now – PP – 1.2145, s1 1.2106, S2 1.2077
JPY – Remains under 104.000 – Trades at 103.75 (PP) – S1 103.60, r1 103.88
GBP – Back to test 1.3612 (low from Thursday) form 1.3720 high yesterday. – s1 13645, s2 1.3605
AUD – Under 0.7700 – trades at 0.7675 (S1) now. S2 0.7654,
NZD – Under 0.7200 – trades at 7170 (s1) S2 – 0.7146
CAD – rallies over 1.2700 – trades at 1.2775 (R1). r2 1.2830
CHF – rallied from 0.8850 to 0.8890 now. – PP 0.8875 – R1 0.8900

You must be registered for see images


BTC – Retraces back to S1 at $31,500. – PP today $33,200, s2 sub $30,000 – $29,900

GOLD – Holds over 1850 – (1869 high yesterday) PP 1856, s1 1845, R1 1866 USOil – Trades at $52.45 (PP) Today s1 52.15, r1 53.15

USA500 – Closed up 13 (+0.36%) 3855 – USA500 FUTS now at 3834 – 57 days north of 20SMA (3789).

Today – UK jobs report, US consumer confidence, ECB’s Villeroy, Earnings – Microsoft, Verizon, General Electric, Johnson & Johnson, Lockheed Martin, 3M, Starbucks, Raytheon, LVMH, UBS and Novartis

Biggest (FX) Mover @ (07:30 GMT) AUDJPY (-0.41%) Rejected 80.30 yesterday, broke 20 & 200hr MA and 80.00 to test to 77.75 low. Recovered into 80.0 at close but has moved below S1 and yesterday’s low to 79.70. Fast MAs aligned and trending lower, RSI 35 and falling, MACD histogram & signal line aligned lower and remain south of 0 line from the breach of 80.00 yesterday. Stochastics in OS zone from earlier. H1 ATR 0.1004, Daily ATR 0.5780.

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.

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

Active member
Date : 27th January 2021.

FX News & Market Update – January 27.



FX News Today
USD slips again ahead of the FED and clarification over stimulus package. US Equities closed flat, (Verizon -3%, J&J +2.7%, GE +2.7% & MS) all beat Earnings expectations (MS up 6% after hours). Asian markets also flat. US Consumer confidence much better than expected. Overnight, AUD CPI improved, JPY data flat and German Consumer Confidence dropped significantly (-15.6 from -7.5). Vaccine rollout continues apace in the UK but the virus death toll passed 100,000 yesterday and unemployment hit a new record. Trump impeachment likely to fail as only 5 of the required 17 Senate Republicans agreed it should proceed.

This weekFED later Today, GDP from EU & US and a big week for US Earnings – FB, Microsoft, Tesla, Apple and DAVOS goes on-line.

USDIndex – Holds over 90.00. Tracks lower from 90.60 high to trade at 90.15, – PP 90.30 S1 89.95.55, R1 90.48

EUR – Back to to test 1.2165 now – PP – 1.2145, s1 1.2120, r1 1.2188

JPY – Remains under 104.000 – Trades at 103.65 (PP) – R1 103.76, S1 103.50

GBP – Back over 1.3700 to test 1.3760. PP – s1 13645, s2 1.3605

AUD – back over 0.7700 – trades at 0.7740
NZD
– Over 0.7200 – trades at 0. 7225
CAD – holds over 1.2700 – trades at 1.2718
CHF – declined from test of 0.8900 to 0.8865 now (s1)



BTC – Pivots through $31,800. – R1 today $32,500, S1 30,000

GOLD – Holds and pivots at 1850 – (1861 high yesterday) PP 1856, s1 1847,
USOil – Trades at $52.95 (R1) Today PP 52.65, S1 52.10
USA500 – Closed down 5 (-0.15%) 3849 – USA500 FUTS now at 3850 – 58 days north of 20SMA (3796).

Today – US Durable Goods, DoEs, FOMC rate decision & Fed Chair Powell press conference, NZ trade, ECB’s Hakkarainen, Lane, Earnings from Apple, AT&T, Facebook, Boeing, Tesla, Blackstone

Biggest (FX) Mover @ (07:30 GMT) GBPCAD (+0.28%) Rallied from open today following break of 20hr MA yesterday. Support now PP 1.7435 andn testing R1 at 1.7490. . Fast MAs aligned and trending higher, RSI 70 rising & testing OB zone, MACD histogram & signal line aligned higher and significantly north of 0 line. MFI in OB zone from earlier. H1 ATR 0.0012, Daily ATR 0.0103.

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 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 to register for FREE!



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

Active member
Date : 28th January 2021.

FX News & Market Update – January 28.



FX News Today
BOOM – Stocks tank (-2%+ worst day in 3 months), USD gets safe haven lift, AUD & NZD hit. Hedge Funds squeezed, stimulus stalled? and vaccine rollout questions. FED – No change to rates & $120 bln/month in QE, the mantra remains until “substantial further progress has been made toward the Committee’s maximum employment and price stability goals.” Durable Goods missed earlier in the day. Earnings from the tech players all exceed expectations (APPLE (-0.77% $100bln+ in revenues and record iPhone sales) FB record revenues but closed down -3.5% “significant uncertainty” ahead. TESLA (-2% missed expectations, but talked up deliveries and a new van. Asian markets closed down -1.53%. The VIX closed over its 200-day moving average for the first time since November 4.

USDIndex – Holds over 90.50 (PP). Tracks higher to 90.81 now – S1 90.15, R1 90.90

EUR – Back to to test 1.2100 now – Low yesterday 1.2057. PP – 1.2115, s1 1.2054, r1 1.2165

JPY – Breached 104.000 – Trades at 104.35 (R1) – PP 103.96, r2 104.55

GBP – Back down over a whole number to 1.3650. PP – s1 13700, S1 1.3640

AUD – biggest loser today – back to test 0.7600 – trades at 0.7607 (S1)

NZD
– back to also test S1 0.7125, – pp & 200Ma 0.7186

CAD – breaches 1.2800 – trades at R1 1.2850 – pp 1.2770

CHF – up to test 0.8900 once again. PP 0.8895, r1 0.8915



BTC – Pivots through $31,000. – R1 today $32,900, S1 29,000

GOLD – Lost pivot at 1850down to 1836 and tested S1 (1832) earlier – PP 1840.

USOil – Trades at $52.50 (PP) – Big draw down – spiked to 53.30 (R1) – but stock sell off pulled prices lower.

USA500 – Closed down 99.85 (-2.57%) 3750 – USA500 FUTS now at 3727 (50SMA) – 58 day north of 20SMA (3790) over.

Today – German CPI, US GDP (Q4), PCE, Weekly Claims, ECB’s Schnabel. EARNINGS – Comcast, American Airlines, Visa, Southwest Airlines, McDonalds, Mastercard, STMicroelectronics.

Biggest (FX) Mover @ (07:30 GMT) AUDUSD (-0.60%) Rejected 0.7750 yesterday breached 20 & 200HR MA early PM. Support now S1 0.7615. Fast MAs aligned and trending lower, RSI 31 falling & testing OS zone, MACD histogram & signal line aligned lower and significantly south of 0 line. Stochs in OS zone from earlier. H1 ATR 0.0019, Daily ATR 0.0075.

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 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 to register for FREE!



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

Active member
Date : 29th January 2021.

FX & Market Update – January 29.



It’s the final trading day of the week and month, and the dollar majors have mostly been holding within their respective Thursday ranges amid a backdrop of whippy global asset markets, which have once again turned to a risk-off positioning mode. The exception has been USDJPY, which floated to a seven-week high at 104.9 on the back of yen weakness, which saw GBPJPY lift to an 11-month high and AUDJPY to a two-day high. This price action is a break in correlation for the Yen, which historically has tended to strengthen during phases of risk aversion in global markets.



EURUSD, meanwhile, has been narrowly orbiting the 1.2100 level for a second day. The Dollar posted modest gains versus the Pound and dollar bloc, and most other currencies, though largely remained off highs seen yesterday. In stock markets, the MSCI Asia-Pacific lost over 0.5% and is set for its biggest weekly decline since last September, of nearly 4%. S&P 500 futures are showing a decline of nearly 1%, more than reversing declines seen by the cash version of the index yesterday on Wall Street. The extraordinary spectacle of retail investors coordinating, via social media, purchases of GameStop and other shares, such as Blackberry, AMC and Bed, Bath and Beyond with the specific aim of forcing hedge funds to stop out of their short positions on such stocks, has been creating volatility and drama in markets this week. The “Reddit Quartet” fell -44.29%, -56.63%, -41.63% and -36.40%, respectively.



Concerns about the SARS-Cov2 coronavirus have in the meantime increased palpably, with US vaccine developer Novavax reporting that its candidate vaccine showed only a 60% efficacy in Phase 3 trials for the South African variant, compared to a 90% efficacy for the non-South African variants. Uncertainty about the effectiveness of available vaccinations against new coronavirus variants (and how easy it would be for vaccines to be tweaked to accommodate new strains) has potential to keep markets on a wary footing until more data is available.



The Pound has pulled back from highs this week, but continues to show gains since the UK’s departure from the transitory membership of the EU’s single market and customs union. The UK currency’s perkiness has been a response to the consequence of the UK Brexiting with a deal, bringing a long-awaited end to uncertainty, as well as the UK’s ahead-of-the-game Covid vaccination program, which could see the UK government start to reverse out of restrictions as soon as mid February, when all of the most-vulnerable groups should have been vaccinated. In this context it should be noted that the Pound remains at historically weak levels by the measure of the real effective exchange rate. The Economist magazine’s Big Mac index, a more informal measure of 56 currency valuations according to the theory of purchasing power parity, shows the Pound to be 22% undervalued against the Dollar.

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 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 to register for FREE!



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

Active member
Date : 1st February 2021.

Events to Look Out for Next Week.



Equity markets have been for sale so far as the “game stocks” frenzy and volatility have added to virus and vaccine woes and uncertainty over stimulus to further shake confidence, while sentiment was supported by earnings. Next week’s heavy dose of global data releases includes US NFP, Eurozone Retail Sales, GDP and CPI but also rate decisions from the BoE and RBA. The data are likely to reveal the many negative impacts from the second wave. Meanwhile, there is a slew of earnings and guidance, which will be key as two giants report, i.e. Amazon and Alphabet.
Monday – 1 February 2021

  • Manufacturing PMI (CNY, GMT 01:00 Sunday) – The Non-Manufacturing PMI is expected to slow down to 52.6 from 55.7 in January.
  • Retail Sales (EUR, GMT 07:00) – German Retail Sales jumped 1.9% m/m after rising 2.6% m/m in Oct. For December, it is anticipated to drop -2.0% m/m.
  • ISM Manufacturing PMI (USD, GMT 15:00) – The ISM index is expected to fall to 59.0 in January from a 2-year high of 60.7 in December, versus an 11-year low of 41.5 in April, a 14-year high of 60.8 in August of 2018, and a low of 34.5 during the last recession in December of 2008.
Tuesday – 2 February 2021
  • RBA Rate Statement & Interest Rate (AUD, GMT 03:30) – In December, RBA Governor Lowe said the RBA doesn’t expect to lift the cash rate for at least three years. Hence the RBA is expected to keep policy settings unchanged with yield target at 0.10% and the cash rate target also at 0.10%. Like other central banks world wide, the RBA could stress again that “monetary and fiscal support will be required for some time.”
  • Gross Domestic Product (EUR, GMT 10:00) – German GDP is expected to have grown by 0.3% on an annualized rate in the first quarter of the year, compared to the -1.9% fall in Q4 2020.
  • Labor data (NZD, GMT 21:45) –In Q4, the unemployment rate is expected to have risen to 5.4% from 5.3%.
Wednesday – 3 February 2021
  • Consumer Price Index (EUR, GMT 10:00) – The Euro Area preliminary core CPI for January is forecasted to remain unchanged at 0.2% y/y.
  • ADP Employment Change (USD, GMT 13:15) – Employment change is seen spiking to 49k in the number of employed people in January, compared to the -123K reading seen last month.
  • ISM Services PMI (USD, GMT 15:00) –The ISM-NMI index is expected to slip to 57.0 from 57.2 in December, versus a 17-month high of 58.1 in July, an 11-year low of 41.8 in April, a 13-year high of 61.2 in September of 2018, and an all-time low of 37.8 in November of 2008. Producer sentiment has remained firm into the turn of the year as businesses scramble to rebuild inventories, despite headwinds from delays for both stimulus and vaccine distributions, alongside tightened coronavirus restrictions through the holidays.
Thursday – 4 February 2021
  • Retail Sales (EUR, GMT 10:00) – Retail Sales should contract to -3.4% m/m in December, leaving the headline at 0.8% y/y.
  • BOE Interest Rate & APF Decision, MPC Mins & Vote (GBP, GMT 12:00) – BoE leaders remain skeptical on negative rates. There was nothing much from BoE officials in January, but Governor Bailey and Deputy Governor Broadbent recently confirmed that the top brass at the central bank remains very cautious on negative rates, which means in the central scenario of a gradual recovery in the second half of the year, the BoE is unlikely to join the negative rate club. Still, like other central banks the BoE is not expected to be in any hurry to rein in stimulus measures and is likely to confirm a “vigilant wait-and-see stance” at next week’s meeting.
  • BoE’s Governor Bailey speech
Friday – 5 February 2021
  • NFP and Labour Market Data (USD, GMT 13:30) – A 100k January nonfarm payroll increase is seen, after a -140k drop in December, but gains of 336k in November and 654k in October. We assume a 30k factory jobs increase in January, after a 38k December rise. The jobless rate should hold steady from 6.7% in December. Hours-worked are assumed to bounce 0.2% after a -0.4% December decline, with the workweek ticking back up to match the 20-year high of 34.8 from 34.7 in December. Average hourly earnings are assumed to rise 0.1% in January, the 0.8% December spike is partly reversed with the big drop in low-wage workers.
  • Labour Market Data (CAD, GMT 13:30) – Employment contracted -62.6k in December after the 62.1k gain in November. The decline was larger than expected (we saw a -30k drop) but not a shock given the increase in regional lockdowns during the month that accompanied the spike in virus cases. The December number was the first monthly employment decline since April. The pull-back was driven by a -99.0k tumble in part time jobs that followed the -37.4k decline in November. The unemployment rate rose to 8.6% in December from 8.5% in November, as the participation rate dipped to 64.9% from 65.1%. The contraction in the job market as lockdowns were reinstated is consistent with a reiteration of the BoC’s whatever-it-takes policy guidance.
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 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 to register for FREE!



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 raeliable 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

Active member
Date : 2nd February 2021.

FX News Today – Tech Giants Day!



Stock markets moved broadly higher after a positive close on Wall Street yesterday. Concern over volatility in retail trading has started to recede and stimulus hopes and vaccine progress are keeping sentiment underpinned. Tech stocks outperformed ahead of earnings from the likes of Amazon and Alphabet today. GER30 and UK100 futures are currently up 0.4% and 0.6% respectively. US futures are also higher, with the tech-heavy USA100 outperforming. The JPN225 closed with a gain of 0.97%. The 10-year Treasury yield is up 0.3 bp at 1.08%, while Australian 10-year rates climbed 0.5 bp even as the RBA announced an extension of asset purchases worth an additional AUD 100 bln. The Dollar was on bid overall on Monday, with a new month reportedly seeing USD inflows, despite the general risk-on conditions seen, which typically weigh on the USD.

Headlines:

  • For Europe it is clear that vaccination programs won’t bring a quick reopening of economies, even in the UK.
  • US records deadliest month of the pandemic.
  • RBA left key rates unchanged, as expected, with the target of 10 basis points for the cash rate on the yield on the 3-year Australian Government bond maintained.
  • US-China: China calls for its relationship with the US to be put back on a predictable and constructive track.
  • Biden had a “substantive and productive discussion” with Republican senators on Covid relief.
  • South Korea is preparing a fourth round of coronavirus cash handouts.
  • CME futures exchange has raised its margin on silver futures by 18%.
  • Robinhood, the online broker at the centre of the boom in day trading, has raised $2.4bn in its second capital infusion in a week to shore up finances strained by turbulent trading.
  • Japanese government saying it would extend Covid related lockdowns and restrictions in various areas of the country for an additional month, to March 7, appeared to have weighed on the Yen as well.
  • Traders continue to price out any hope of additional rate cuts from BoE and ECB and data releases today are likely to be bond negative, with preliminary GDP numbers for the Eurozone and French HICP inflation likely to come in higher than originally anticipated
Forex Market

EUR –
is trading at 1.2071, bellow PP and a breath above 2-month Support at 1.2000.
GBP – dollar safe haven strength drifted Pound to 1.3600 territory. Currently close to PP at 1.3690.
JPY – Resistance is at the psychological 105.00 level, with buy-stops noted above the level. A break higher will see the 200-day moving average at 105. 63 as the next upside target. The pairing last traded above the 200-DMA in June of 2020. Currently below R3 at 104.97.
AUD – ranging between the PP and S1, (0.7600-0.7665).
CAD – at 1.28 from 1.2860 highs.
Silver – in retreat, fell by 4% back below $28 – CME has raised its margin on silver futures which is arguably a significant factor in driving prices lower today.
USOil – surged to 54.35.

Today: Focus mainly on GDP reading for the Eurozone, and the Labor data for New Zealand . OPEC meeting on tap as well.

Biggest Mover AUDCAD (+0.32% as of 08:00 GMT) – The Australian Dollar ebbed after the RBA left interest rates unchanged but extended its QE program following its February board meeting. Governor Lowe also noted in the central bank’s statement that the exchange rate “has appreciated and is in the upper range of the recent year.” AUDUSD edged out a five-day low at 0.7603.

RBA left key rates unchanged, as expected, with the target of 10 basis points for the cash rate on the yield on the 3-year Australian Government bond maintained. The parameters of the Term Funding Facility were also confirmed, but the RBA decided to purchase an additional AUD 100 bln of bonds issued by the government, states and territories “when the current bond purchase program is completed in mid April. These additional purchases will be at the current rate of AUD 5 bln a week”. The statement said the outlook for the global economy has improved over recent months thanks to vaccine developments. It warned, however, that the expected recovery is likely to “remain bumpy and uneven” and “remains dependent on the health situation and on significant fiscal and monetary support”. The central scenario is for the Australian economy to expand 3 1/2 percent this year as well as expected to “return to its end-2019 level by the middle of this year”. Spare capacity is likely to stay for some time. Inflation and wages growth are expected to pick up from weak levels, but to remain “below 2% over the next couple of years”.

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 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 to register for FREE!



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

Active member
Date : 3rd February 2021.

Amazon, Alphabet & Stimulus top boost to the Equity market



Stock markets extended their rally overnight and yields climbed higher. 10-year rates jumped more than 11 bp in New Zealand after the country approved the first Covid-19 vaccine. The ongoing earnings season is adding support and better than expected revenue estimates from Alphabet and Amazon helped to bolster confidence.

The major indexes climbed back toward recent highs, unperturbed by the threat of six more weeks of winter as Punxsutawney Phil saw his shadow. Treasury yields have lifted 0.9 bp to 1.1%, while JGB rates are up a modest 0.1 bp at 0.05%. The JPN225 gained 1% and the ASX 0.9%, although Hang Seng and CSI 300 are currently both marginally lower after the People’s Bank of China drained some funds from the financial system. The GER30 and UK100 futures are up 0.4% and 0.3% respectively.

The earnings season is in full swing now and so far hasn’t dented the renewed surge in risk appetite and confidence that vaccination programs will help the global recovery to strengthen this year. Wall Street had another very good day yesterday and the move higher in stocks is set to resume today, also helped by hopes of accelerated fiscal stimulus in the US. Against that background any lingering expectations of additional rate cuts in Europe are being priced out, which should keep pressure on core EGBs.

Headlines:

  • President Biden and Senate Democrats look to pass the $1.9 tln relief bill via “reconciliation” (51 votes) and bypassing the Republicans.
  • US: New cases of Covid-19 fall for a 3rd week in a row – the first time this has been seen since September.
  • According to IBES data from Refinitiv: More than 80% of reports from USA500 companies so far have surpassed analysts’ earnings expectations, with 97% of reports from technology companies beating.
  • — Shares of the retailer were up 1% in after-hours trading on the back of that beat analyst expectations. Amazon reported earnings per share of $14.09 on revenue of $125.56 billion. Analysts polled by Refinitiv expected a profit of $7.23 per share on revenue of $119.7 billion.
  • The company also announced that CEO Jeff Bezos will move to the role of executive chairman in the third quarter and be replaced by Amazon Web Services head Andy Jassy as chief executive officer.
  • — Alphabet shares jumped 6% after the tech giant reported for the previous quarter. The company reported earnings per share of $22.30 on revenue of $56.9 billion. Analysts polled by Refinitiv expected a profit of $15.90 per share on a revenue of $53.13 billion.
  • — Shares of the brick-and-mortar video game retailer continued to tumble in after-hours trading on Tuesday following a 60% drop in the regular session. Shares are down more than 70% this week as the short squeeze trade unravels.
  • Amazon, Alphabet, Microsoft and Salesforce are all investing in a $28 billion start-up company that crunches big data.
  • China Caixin services PMI dropped to 52.0 in January from 56.3.
  • Japan Jan Services PMI fell to 46.1 from 47.7 in December.
  • New Zealand Q4 2020 Unemployment rate 4.9% (vs. expected 5.6%).
  • BOJ Deputy Governor Wakatabe watered down expectations of much change from the bank’s monetary policy review due next month.
Forex Market

EUR –
decline continues with the asset trading below 1.2100. S1 at 1.2007.
GBP – fell against the USD but remains above 20-DMA. S1: 1.3615, PP: 1.3660, R1: 1.3715.
JPY – lifted to 105.05, as the Yen weakened.
AUD – founds floor at 50-DMA (0.7600).
CAD – tumbled in 4-day range. Currently above S1 at 1.2750.
Silver – sharp reversal, filling the week’s gap. CFTC and CME warnings helped to quell price speculation.
USOil – at $55.20 with the move higher due to signs of tightening supply.

Today: Focus mainly on fundamentals which will be a focal point near term with ADP and ISM services reports today, and the jobs report Friday. Also Eurozone inflation data and final readings for Eurozone and UK Services PMIs meanwhile will act as a reminder that for now virus restrictions continue to weigh on overall activity and keep Europe on track for a recession over Q4/Q1.

Biggest Mover NZDJPY (+0.41% as of 08:00 GMT)



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 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 to register for FREE!



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

Active member
Date : 4th February 2021.

February: Emergence of more virulent strains.



The New Year’s rally on Wall Street and global markets ran into turbulence during January. Rising virus cases and more stringent lockdowns, a shaky rollout of the vaccine in the US and Europe and the emergence of more virulent strains tempered optimism about the recovery. A frenzy in select stocks prompted a surge in anxiety and volatility on Wall Street. But the equity market bounced back into February, supported by still intact recovery expectations and a calming in market volatility. The uptrend in bond yields sputtered amid myriad developments and uncertainties, only to resume as stocks rebounded.



·





In February, fundamentals will continue to inform recovery expectations, while the market remains alert for another round of volatility fueled by retail investors.

You must be registered for see images



Fundamentals were briefly pushed to the side in the final week of January, as a frenzy erupted around shares of GameStop and AMC that was driven by retail investors taking cues from internet message boards. However, a rise in margin requirements and curbs on trading activity calmed trading in those high profile shares, easing the market’s anxiety.

The vaccine rollout was a bit rougher than hoped in the US and Europe during January, with reports circulating of unused doses and challenges with distribution. Moreover, the emergence of mutated strains globally prompted worries that the vaccines may not be as effective against the new strains, delaying a return to normal activities. Moderna and Pfizer reported that based on laboratory studies, their vaccines are only effective against one of the new variants. The mutations are an evolving situation that the markets will follow closely in February, even as vaccine distribution ramps up globally.

But as February began, encouraging signs emerged on vaccine distribution, infection rates and hospitalizations in the US and Europe. Consequently, global recovery expectations have been rolled ahead, not reduced or eliminated.

In the Eurozone, the Q4 GDP growth wasn’t as bad as feared. However, the risk of a double dip recession in both the Eurozone and the UK remains firmly on the table, as services in particular continue to suffer. Inflation has jumped higher at the start of the year, especially in Germany, which backs expectations that neither the ECB, nor the Bank of England are likely to add additional rate cuts. Eurozone Q4 GDP contracted -0.7% (q/q, sa), less than initially expected in the light of renewed lockdowns towards the end of the year. Economic activity was down -5.1% in the last quarter of 2020, compared to a year earlier, highlighting that there is a long way to go before activity has reached pre-pandemic levels even if restrictions are lifted quickly, which is unlikely to be the case. Hence, the risk of a technical recession remains firmly on the table, while data also highlights the growing divergence between Eurozone countries, which will pose a challenge for politicians and central bankers alike going forward.

Germany’s economy seems to have weathered the pandemic better than many other Eurozone countries, largely thanks to a resilient manufacturing sector, which has remained open during the current lockdown, and the recovery in major export markets. Like elsewhere, the central scenario remains for a recovery in activity in the second half of the year. But looking ahead, it will be key that the government doesn’t go back to the pre-pandemic status quo, but focuses on a structural renewal that helps to lift long term growth potential. The fact that Chancellor Merkel will leave the political stage following the general election in the second half of the year may be the chance to achieve just that.

German economic activity contracted -5.0% last year, somewhat less than feared, although adjusted for calendar effects the contraction was somewhat higher at -5.3% y/y. Of course Covid-19 developments and lockdowns are largely to blame, with much of the weakness concentrated in the first half of 2020, when strict lockdowns brought activity to a standstill.

You must be registered for see images


Activity picked up over the summer, before another wave of infections resulted in the current lockdown. While this lockdown is less strict than in some other European countries, the hospitality and travel industries remain effectively shut down without the prospect of a swift easing of restrictions. Vaccination programs have started, but remain in the state hands, which has led to a very uneven rollout. Still, the manufacturing sector remains largely open and construction actually managed to expand last year. Furthermore, stock building exercises ahead of Brexit helped to boost manufacturing in Q4. However, there will likely be demand missed in the first quarter of this year and the chances are that there will be a technical recession over Q4 2020 and Q1 2021.

Still, the main scenario is for a recovery in the second half of the year, also helped by very favourable financing conditions and fiscal support that was scaled up substantially in 2020. The overall debt to GDP ratio is still much lower than in many other Eurozone countries, and with government bond yields negative out to the 10-year area and the ECB continuing to buy substantial amounts in the secondary market, clearly Germany doesn’t have a real problem financing the debt, especially with a huge current account surplus.

A healthy fiscal situation already helped Germany to scale up wage support programs and job retention schemes at the start of the pandemic and the jobless number has remained low by comparison — falling to just 6.1% at the end of last year. Like elsewhere it will take time before the true impact on the labour market will become clear — once government support has been phased out. The risk is that the pandemic will lead to higher structural unemployment if and when there are major structural shifts, with the older generation likely to struggle to re-integrate into a changed labour market.

Indeed, the pandemic has highlighted fundamental problems in Germany’s economic model. Like in other countries, the challenge for the government will be to use the funds being made available now to facilitate a shift in focus and a structural renewal. Economically that requires a move away from the focus on manufacturing and a strengthening of the still woefully inadequate digital infrastructure. The success of BioNTech in the search for a vaccine highlighted that there is still life in Germany’s R&D sector, but the overall number of start ups has been quite low in recent years compared to other countries. Germany will need to focus on promoting structural renewal — the exit of Chancellor Merkel from the political stage and the end of a focus on budget consolidation should provide the perfect opportunity for that.

You must be registered for see images


Chancellor Merkel, who has been in office since 2005, really is on the way out now. She already relinquished the party leadership at the end of 2018, and will likely leave the political stage at the general election in the second half of the year. The experienced leader still helped to guide Germany through the pandemic. Her background in science clearly was beneficial during the first wave of the pandemic, when a swift reaction to developments prevented the type of death numbers seen elsewhere in Europe. Ironically though, that actually backfired to a certain extent as the lack of cases and excess deaths early on played into the hands of conspiracy theorists denying the existence of a real virus threat, leaving Chancellor Merkel with state premiers that not only went further in re-opening the economy over the summer than Merkel would have liked but also delayed the reaction to the renewed rise in case numbers later in the year.

You must be registered for see images


There already have been coalitions between the conservatives and the former protest party at the state level, but whether this is a viable option for Berlin will also depend on who will become the candidate for Merkel’s succession in the general election. Merkel’s CDU is currently busy trying to determine a new party leader, and business-man Merz seems to have the upper hand. Under Merz, the CDU is likely to move more to the right and a pre-Merkel type of conservativism that would make cooperation with the Green Party more difficult. On the other hand, it may help the CDU/CSU win back some of the voters that went over to the AfD in protest against Merkel’s immigration policy. As such it could help to de-fragment the German political landscape.

If Merz becomes first party leader and then Chancellor, it would likely also have a positive impact on the digitalisation and the start up culture in Germany. However, Merkel’s departure is also likely to leave its mark on the political landscape in Europe and will have wider implications for the Eurozone and the EU going forward. A shift towards a greater focus on business interests under Merz will likely also mean an attempt to push German interests at European level and ultimately greater confrontation with the southern block. For now the focus on the pandemic has helped to gloss over differences at the ECB, but with the end of the pandemic, internal discussions and conflict are likely to pick up. Ultimately that could be healthy and if it does undermine market confidence in the Eurozone for a while and thus weigh on the EUR, that may actually be a welcome development at least at the start of the recovery.

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 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 to register for FREE!



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

Active member
Date : 4th February 2021.

FX News Today – NFP Day! – Dollar set for best week in three months.



Stock markets have moved broadly higher overnight after a strong close on Wall Street, which was supported by indications that the labour market is recovering, positive forecast for upcoming earnings and ongoing hope of stimulus as markets buy into the expected recovery in the world economy later in the year, when vaccination programs have helped to re-open economies. Strength was also broadbased though paced by tech, financials, and energy. The USA100 climbed to 13,777 while the USA500 rose to 3871. The USA30 firmed to 31,055 but fell shy of its January 20 historic high of 31,188. Bond markets steadied and the 10-year Treasury yield is down -0.5 bp at 1.1%, while the JGB rate has dropped -0.4 bp to 0.05%. GER30 and UK100 futures are up 0.3% and 0.1% respectively, alongside broad gains in US futures.

That left sentiment upbeat ahead of the US payroll numbers today. Also helping has been the improving outlook on the pandemic as vaccine jabs increase and virus cases slow.

Headlines:

  • Strong earnings and improving fundamentals (jobless claims and factory orders today) supported, as did expectations for the $1.9 tln stimulus bill after the Democrats moved to fast-track the bill.
  • The RBA’s quarterly statement on monetary policy stuck to the script and repeated that the bank can still extend asset purchases if needed.
  • BoE not in the mood for negative rates! The BoE left policy settings unchanged, as widely expected. Lingering hopes that the central bank would join the negative rate club were dashed, and yields moved sharply higher while the Pound strengthened. – UK100 is still outperforming as the GBP remains supported following the BoE statement yesterday.
  • The global stock rally also paused briefly and despite cautious words from central bankers highlighting ongoing risks, investors are increasingly buying into the recovery story.
  • Earnings remain in focus with Ebay Inc and PayPal Holdings supported by positive forecasts.
  • GameStop closed under $55, its lowest for two weeks – Robinhood lifted restrictions on buying Gamestop and AMC.
  • Global bond funds led inflows in the seven days to Feb. 3, on the back of a rise in US yields, while money market funds witnessed the highest outflows in eight weeks.
  • Investors purchased $27.2 billion in bond funds last week, the biggest in eight months, and sold $32 billion worth of money market funds, Refinitiv Lipper data showed.
Forex Market

EUR –
down for a second day below 1.2000.
GBP
– supported at 1.3680. Gilts selling off yesterday and weighed on the UK100.
JPY – retests the 200-DMA and 3-month Resistance at 105.60.
AUD – ranging between PP and S1 (0.7600-0.7665).
CAD – stacked at 1.28 lows.
GOLD – breaks 1800.
USOil
– remains supported and the front end WTI future is trading at USD 56.61 per barrel.

Today: Markets will be waiting for the non-farm payroll report out of the US but for what it is worth today’s local calendar includes German manufacturing orders data for December.

Biggest (FX) Mover USOIL (-0.80% as of 08:50 GMT) – It clocked a fresh 1-year high at $56.84, breaking the 200-week SMA, with a strong weekly bullish candle, ignoring the 3-week doji candles posted so far. Data this week showing a drawdown in US crude inventories, along with demand-bolstering colder than usual winter weather in large parts of the northern hemisphere, have been underpinning oil.

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 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 to register for FREE!



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.
 
Top