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Markets On Wednesday, U.S. stocks experienced a significant surge as investors assessed robust corporate profits and witnessed major technology companies extending their upward trajectory. These movements occurred amidst ongoing discussions regarding the timing of potential interest rate cuts. Even as U.S. yields backed up a touch, notably, the S&P 500 approached the 5,000 mark for the first time, hinting at mega-cap tech’s de-coupling from bond yields but supported by an upbeat macro story, where the economy continues to operate at an above-trend pace with no material signs of falling below trend in the near-term. Indeed, higher rates don’t appear to burden consumers or corporations significantly, enabling the Fed to wait longer to ensure inflation control without disrupting the stock market’s momentum amid robust U.S. growth dynamics. While revelling in the glow of robust macro growth, market participants took stock of corporate performance during this earnings season, with approximately two-thirds of S&P 500 company reports now available. Overall, results have surpassed Wall Street expectations on average, overshadowing weakness in other less weighty areas at the index level. It’s becoming increasingly evident that equities are unfazed and indifferent to the Federal Reserve’s less dovish stance, which suggests that unless there is a… Read More »S&P 500: The 5000 summit push

AUD/USD rose further and flirted with the 100-day SMA near 0.6630. The selling pressure in the greenback favoured extra gains. Investors continued to assess the latest hawkish hold by the RBA. The Aussie dollar found another excuse to extend the weekly bounce in the continuation of the downward bias in the greenback on Wednesday. In fact, the US dollar gave away further gains after hitting a new yearly high north of the 104.00 barrier when tracked by the USD Index (DXY) earlier in the week, all amidst further investors’ repricing of a potential interest rate cut by the Federal Reserve (Fed) either in May or June. Back to the domestic panorama, AUD remained underpinned pari passu with traders’ assessment of the latest interest rate decision by the Reserve Bank of Australia (RBA), which maintained interest rates unchanged at 4.35% amidst a hawkish message, leaving the door open to a potential interest rate hike in the future. Continuing with the RBA, the Statement on Monetary Policy (SoMP) revealed a slight reduction in the bank’s inflation forecasts, expecting both metrics to stay below 3% by the fourth quarter of 2025. Furthermore, the RBA revised down its GDP growth projections for the foreseeable… Read More »AUD/USD Forecast: Recovery gathers further pace

The gap. The test. The pattern. What does this combination say about the behavior of market participants? Over the last few weeks, I have been sharing with you my point of view on the current technical situation in the XOI, natural gas, copper, and individual companies every trading day. Thanks to them, many of you have made the decision to act in accordance with the forecasts and have already made money. Congratulations to you! But probably at the same time, many of you may have been wondering: hey, what about crude oil? Why don’t we know what your point of view on this most important (or one of the most important) commodity for us is? Today, I decided to pull back the curtain and share with you my premium part on crude oil from yesterday. Why? Because yesterday we closed our short positions and took quite nice profits off the table. If you want to know what technical factors influenced this decision, I encourage you to read the article below. And… if next time you don’t want to miss such an opportunity and join the group of investors who also make money on this commodity, I encourage you to subscribe… Read More »Is Crude Oil at a crossroads?

XAU/USD Current price: 2,037.05 Without relevant macroeconomic data, the focus stays on Fed’s speakers. The US Dollar stays under moderate selling pressure, XAU/USD reaches a fresh weekly high. XAU/USD gained momentum with Wall Street’s opening, needs to break through the intraday high. Spot Gold spent the first half of the day trading lifeless in the $2,030 price zone, picking up some steam after Wall Street’s opening. XAU/USD jumped to $2,044.64 as the positive tone of Wall Street undermined demand for the US Dollar. The Greenback stayed on the back foot for most of the day, although it posted limited losses against most major rivals amid the absence of first-tier events. Market players are repositioning after major central banks’ monetary policy announcements, most of which included pouring cold water on rate cut hopes. Federal Reserve (Fed) speakers are flooding the wires this week, and despite a generalized optimism regarding inflation moving in the right direction, policymakers also warned about the dangers of moving too early or too fast. Meanwhile, US Treasury yields shed early gains, also weighing on the USD. The 10-year Treasury note offered as much as  4.13% ahead of the opening, now down to 4.09%, unchanged on the day.… Read More »Gold Price Forecast: XAU/USD jumped to a fresh weekly high, struggles to maintain gains

EUR/USD Current Price: 1.0769 Mixed words from Federal Reserve officials reinforce the market’s cautious stance. German Industrial Production fell sharply in December, weighing on the Euro. EUR/USD trades near its weekly high, but chances of a steeper advance seem limited. Financial markets extend the cautious trading on Wednesday amid mixed comments from Federal Reserve (Fed) officials and Chinese woes, although the US Dollar remains under modest selling pressure. EUR/USD changes hands in the 1.0760/70 region, advancing for a second consecutive day, yet modestly. On the one hand, Fed of Cleveland President Loretta Mester said that the central bank could lower interest rates at some point later this year but warned that it could be a “mistake” to cut too soon. On the other hand, Fed’s Philadelphia President, Patrick Harker, stated that a soft-landing is in sight for the United States (US) economy, although he also added that inflation is falling and that he sees real progress on getting it back to target. Finally, he noted the labor market is in a better balance. Meanwhile, plummeting Chinese stocks have led to Beijing’s intervention these last few days, with major stocks losing over the 10% daily limit. Authorities aimed to increase liquidity… Read More »EUR/USD Forecast: Cautious buying loses momentum

EUR/USD recovered above 1.0750 following a two-day decline. The pair could encounter stiff resistance near 1.0800. Investors will continue to pay attention to central bank commentary and risk perception. EUR/USD registered small gains on Tuesday and continued to push higher toward 1.0800 early Wednesday. The pair needs to flip that level into support to attract technical buyers. The renewed US Dollar (USD) weakness helped EUR/USD gain traction on Tuesday. In the absence of high-tier macroeconomic data releases, the USD struggled to find demand as the benchmark 10-year US Treasury bond yield corrected lower following the impressive upsurge that was fuelled by the upbeat January jobs report late last week.

The selloff in US sovereign bonds reversed yesterday after a solid demand for the US 3-year bond auction counterweighed a bulk of hawkish comments from Federal Reserve (Fed) members. The Fed members are on the battlefield, fighting the doves. Loretta Mester said there is no rush to cut rates and Neel Kashkari said that the Fed hasn’t reached its inflation goal yet. The game is now being played for a May cut, with around two thirds probability attached to it. And there is one thing that keeps the doves resisting: the resurfacing US regional bank worries and a potential commercial real estate crisis. The New York Community Bank Corp plunged another 22% on Tuesday after Moody’s downgraded its rating to ‘junk’. What’s encouraging is that the KBW index gave no reaction to the latest shake, as proof that the Fed has been extremely successful in isolating the banking sector woes with liquidity and stopgap measures. What’s worrying is that these measures will expire next month. But what’s soothing is that the Fed could use them whenever needed to calm down the market nerves. Investors also bear in mind that the next move from the Fed is most probably loosening of… Read More »A tug of war between hawks and doves

Gold price is consolidating the Tuesday turnaround early Wednesday. US Dollar, Treasury bond yields keep the red amid Chinese stimulus optimism.   Daily technical setup points to range trade for Gold price at around $2,030. Gold price is consolidating the solid rebound from the weekly low of $2,015 early Wednesday. The US Dollar (USD) extends its pullback from multi-month highs, in the wake of retreating US Treasury bond yields and a risk-friendly market environment, motivating Gold buyers to gather pace before the next push higher. Gold buyers pause ahead of more Fedspeak Risk sentiment remains in a sweeter spot so far this Wednesday’s trading, as investors cheer a raft of measures by the Chinese regulator to support share prices after the market plunged to five-year lows. Markets are paying limited attention to the reduced bets for aggressive rate cuts from the US Federal Reserve (Fed) coupled with strong US economic data and hawkish Fedspeak, as the US Dollar is bearing the brunt of the broader market optimism and negative US Treasury bond yields. The US Treasury bond yields are extending their pullback, as markets anticipate a big auction of the US 10-year Treasury bonds later on Wednesday. These factors are… Read More »Gold Price Forecast: XAU/USD set to extend its struggle around $2,030

Overview: The US dollar is consolidating its the two-day surge since the jobs data at the end of last week. The Reserve Bank of Australia did not rule out additional rate hikes, and although the derivatives markets do not think it is likely, the Australian dollar is the best performer in the G10 today with a small gain. An unexpectedly strong German factory orders report failed to help the euro much and it languished near yesterday’s low. Sterling finally broke out of its $1.26-$1.28 range and is also moving sideways in a roughly $1.2530-65 range. Signs that Chinese officials are stepping up their support for the equities saw the CSI 300 jump around 3. 5% and the Hang Seng surged by a little more than 4%. Among the large markets, Japan, South Korea, and Australia fell. Europe Stoxx 600 is flat to firmer and US index futures are narrowly mixed. European benchmark 10-year yields are mostly around a basis point higher, while the US 10-year Treasury yield is practically flat near 4.16% and the two-year yield is off a couple of basis points to 4.54%. The US quarterly refunding begins today with $54 bln three-year notes on sale. Gold is consolidating… Read More »Greenback consolidates two-day surge

MARKETS The recent downward trend in U.S. stock indexes, driven by diminishing rate cut expectations, is showing signs of stabilizing as U.S. bonds calm down. Investor sentiment was pressured on Monday as hopes for a March interest-rate cut by the Federal Reserve diminished. Earlier in the year, expectations of Fed policy easing had fueled gains in stock indexes. However, despite the recent fluctuations, major indexes are still close to their record high, suggesting that while rate cut expectations and earnings reports may drive short-term fluctuations, the overall market sentiment remains relatively optimistic, with investors closely monitoring both economic data and corporate performance. The U.S. bond market rebounded, with 10-year yields falling precipitously, providing some welcome eye candy for U.S. stocks and general interest rate-susceptible sectors of global capital markets. Indeed, with yields falling ahead of the upcoming $42 billion sale of 10-year Treasury bonds, dealers are positioning for good demand after a solid start to this week’s ramped-up issuance sizes. Despite cautious remarks from Federal Reserve officials, including Fed Bank of Minneapolis President Neel Kashkari and Cleveland Fed President Loretta Mester, indicating that the central bank is not in a hurry to cut rates, market sentiment is holding up. Still,… Read More »Asia open: The fall in 10 year yields is providing some welcome eye candy