Tuesday 11th March 2025: Asia-Pacific Markets Decline Amid U.S. Recession Fears
By IC Markets
Asian Stock Markets : Nikkei down 0.71%, Shanghai Composite down 0.32%, Hang Seng down 0.81% ASX down 0.91%
Commodities : Gold at $2902.35 (0.10%), Silver at $32.5 (0.18%), Brent Oil at $69.25 (-0.05%), WTI Oil at $65.88 (-0.14%)
Rates : US 10-year yield at 4.183, UK 10-year yield at 4.645, Germany 10-year yield at 2.8250
IC Markets Europe Fundamental Forecast | 4 March 2025
By IC Markets
After unexpectedly falling in December to mark the first decline in nine months, consumer spending rebounded in January as sales increased 0.3% MoM. The upturn was supported by an increase in categories such as cafes, restaurants and takeaway food services; food retailing; and clothing, footwear and personal accessory retailing.
IC Markets Europe Fundamental Forecast | 27 February 2025
By IC Markets
What happened in the Asia session?
With no major data releases, it was a fairly quiet session as the dollar index (DXY) edged higher towards 106.80 while spot prices for gold fell under $2,900/oz by midday in Asia. Crude oil prices remained under intense overhead pressures with WTI oil hovering above $68.50 per barrel as a potential peace deal between Russia and Ukraine lingers in the background.
Monday 24th February 2025: Technical Outlook and Review
By IC Markets
[b]DXY (US Dollar Index):[/b]
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Price could potentially make a short-term rise toward the pivot before reversing and falling toward the 1st support. Also, price has crossed below the Ichimoku cloud, signaling a shift to the downside.
Pivot: 107.49
Supporting reasons: Identified as an overlap resistance, indicating a potential area where selling pressure could emerge.
1st support: 105.44
Supporting reasons: Identified as an overlap support that aligns with the 50% Fibonacci retracement and the 161.8% Fibonacci extension, forming a strong Fibonacci confluence where price could find support.
1st resistance: 108.67
Supporting reasons: Identified as a swing high resistance, indicating a potential level that could cap further upward movement.
IC Markets Europe Fundamental Forecast | 17 February 2025
By IC Markets
What happened in the Asia session?
Wednesday 12th February 2025: Asia-Pacific Markets Mixed as Investors Weigh Tariffs and Fed Policy
By IC Markets
Global Markets:
Asian Stock Markets : Nikkei up 0.29%, Shanghai Composite up 0.01%, Hang Seng up 1.56% ASX up 0.6%
Commodities : Gold at $2910.35 (-0.73%), Silver at $32.15 (-0.48%), Brent Oil at $76.19 (0.39%), WTI Oil at $73.00 (-0.43%)
Rates : US 10-year yield at 4.4550, UK 10-year yield at 4.506, Germany 10-year yield at 2.427
News & Data:
(CAD) Building Permits m/m 11.0% to 1.6% expected
Markets Update:
Asia-Pacific markets traded mixed on Wednesday as investors assessed the impact of U.S. President Donald Trump’s tariffs on regional economies. Meanwhile, U.S. Federal Reserve Chair Jerome Powell reiterated the central bank’s focus on controlling inflation and emphasized that policymakers were in no rush to lower interest rates.
In regional markets, Australia’s S&P/ASX 200 rose 0.5%, while Japan’s Nikkei 225 gained 0.23% after resuming trading post-holiday. However, the Topix dipped 0.2%. South Korea’s Kospi climbed 0.31%, whereas the small-cap Kosdaq declined 0.64%. Hong Kong’s Hang Seng Index surged 1.56%, but mainland China’s CSI 300 slipped 0.13% in volatile trading. India is set to release its January inflation data, with the Nifty 50 opening 0.94% lower and the BSE Sensex falling 0.97%. Investors also await SoftBank Group’s fiscal third-quarter earnings later today.
U.S. markets closed mixed overnight. The S&P 500 edged up 0.03% to 6,068.50, while the Nasdaq Composite dropped 0.36% to 19,643.86. The Dow Jones Industrial Average gained 123.24 points, or 0.28%, to 44,593.65. Powell’s testimony comes amid political uncertainty, as Trump pushes for tariffs on trading partners, creating uncertainty about the administration’s stance toward the Fed.
Powell reaffirmed that the current policy stance, with the benchmark Fed funds rate set between 4.25% and 4.5%, offers flexibility. The Federal Open Market Committee left rates unchanged in its late-January meeting, signaling a cautious approach to monetary policy amid ongoing economic and political uncertainties.
Upcoming Events:
01:30 PM GMT – USD Core CPI m/m
01:30 PM GMT – USD CPI m/m
01:30 PM GMT – USD CPI y/yMonday 10th February 2025: Markets Mixed Amid Trade Tensions and Inflation Worries
By IC Markets
Global Markets:
Asian Stock Markets : Nikkei down 0.13%, Shanghai Composite up 0.61%, Hang Seng up 1.86% ASX down 0.34%
Commodities : Gold at $2915.35 (0.93%), Silver at $32.75 (0.38%), Brent Oil at $75.19 (0.69%), WTI Oil at $71.54 (0.73%)
Rates : US 10-year yield at 4.487, UK 10-year yield at 4.476, Germany 10-year yield at 2.377
News & Data:
(CAD) Unemployment Rate 6.60% to 6.80% expected
(CAD) Employment Change 76.0K vs 25.5K expected
(USD) Non-Farm Employment Change 143K vs 169K expected
Markets Update:
Asia-Pacific markets showed mixed performance on Monday as rising trade tensions kept investors cautious. U.S. President Donald Trump stated he planned to impose a 25% tariff on all steel and aluminum imports, fueling market uncertainty. Japan’s Nikkei 225 closed flat at 38,801.17, while the Topix index edged down 0.15% to 2,733.01. The country’s loan growth slowed to 3% in January from December’s 3.1%. South Korea’s Kospi remained unchanged at 2,521.27, but the Kosdaq gained 0.91% to 749.67.
Hong Kong’s Hang Seng index rose 1.67%, and China’s CSI 300 gained 0.11% after earlier losses. China’s consumer inflation hit a five-month high in January due to Lunar New Year spending, with the CPI rising 0.7% monthly and 0.5% annually, surpassing Reuters’ 0.4% estimate. Meanwhile, the producer price index fell 2.3% annually, exceeding the expected 2.1% drop. Indian markets extended losses from Friday after the Reserve Bank of India’s unexpected interest rate cut. The Nifty 50 fell 0.94%, while the BSE Sensex dropped 0.83%.
Singapore’s Straits Times Index hit a record high of 3,910.12 points, driven by gains in Singtel and major banks. The STI was up 0.68%. Australia’s S&P/ASX 200 fell 0.34% to 8,482.80. The three key U.S. indexes fell Friday after Trump’s tariff announcement and inflation concerns. Markets were further pressured by consumer sentiment and jobs data, which pointed to rising inflation and pushed the 10-year Treasury yield above 4.5% at its session high.
The Dow Jones Industrial Average lost 444.23 points, or 0.99%, to close at 44,303.40. The S&P 500 declined 0.95% to 6,025.99, and the Nasdaq Composite slid 1.36% to 19,523.40. Friday’s losses pushed major indexes into negative territory for the week.
Upcoming Events:
02:00 PM GMT – EUR ECB President Lagarde SpeaksWednesday 5th February 2025: Asia-Pacific Markets Mixed as Wall Street Rallies Amid Trade Tensions
By IC Markets
Global Markets:
- Asian Stock Markets : Nikkei up 0.12%, Shanghai Composite down 0.83%, Hang Seng down 1.13% ASX up 0.5%
- Commodities : Gold at $2887.35 (0.43%), Silver at $32.95 (-0.28%), Brent Oil at $76.59 (-0.19%), WTI Oil at $72.64 (-0.13%)
- Rates : US 10-year yield at 4.512, UK 10-year yield at 4.5210, Germany 10-year yield at 2.392
News & Data:
- (USD) JOLTS Job opening 7.60M vs 8.01M expected
Markets Update:
Asia-Pacific markets were mixed Wednesday as Wall Street gained overnight, shrugging off Trump’s tariffs and China’s retaliatory measures. China resumed trading after the Lunar New Year break, with investors closely monitoring its response to U.S. duties. Morningstar’s Asia equity analyst Kai Wang noted that China’s tariffs on U.S. imports are largely symbolic, affecting only 12% of total imports. While the immediate risk appears limited, uncertainties remain as trade tensions could escalate given Trump’s unpredictable stance, keeping market volatility a key concern.
Mainland China’s CSI300 Index opened higher but later declined 0.27%, while the Caixin Services PMI fell to 51.0 in January from 52.2 in December, indicating a slowdown in services activity. Hong Kong’s Hang Seng dropped 0.69%, reversing previous gains. In Japan, the Nikkei 225 edged down 0.12%, with the broader Topix index remaining flat. South Korea’s Kospi climbed 1.16%, while the Kosdaq advanced 1.31%. The country’s January consumer price index rose 0.7% month-on-month and 2.2% year-on-year, exceeding expectations.
Indian markets saw modest gains as investors awaited the Reserve Bank of India’s monetary policy decision, anticipating a rate cut. The Nifty 50 rose 0.11%, while the BSE Sensex inched up 0.15%. Meanwhile, Australia’s S&P/ASX 200 gained 0.61%, tracking overall regional movements.
In the U.S., markets closed higher, fueled by strong earnings reports. Palantir surged 24% on solid quarterly results, while Nvidia rose 1.7%. The Nasdaq Composite jumped 1.35% to 19,654.02, the S&P 500 climbed 0.72% to 6,037.88, and the Dow Jones gained 134.13 points to close at 44,556.04.
Upcoming Events:
- 03:00 PM GMT – USD ISM Services PMI
- 02:45 PM GMT – USD Final Services PMIMonday 27th January 2025: Asian Markets Mixed as Investors Assess China’s Economic Data
By IC Markets
Global Markets:
- Asian Stock Markets : Nikkei down 1.01%, Shanghai Composite up 0.12%, Hang Seng up 0.84% ASX up 0.36%
- Commodities : Gold at $2786.35 (-0.76%), Silver at $30.65 (-1.48%), Brent Oil at $76.39 (-0.89%), WTI Oil at $74.04 (-0.83%)
- Rates : US 10-year yield at 4.586, UK 10-year yield at 4.6305, Germany 10-year yield at 2.5445
News & Data:
- (USD) Flash Manufacturing PMI 50.1 vs 49.8 expected
- (USD) Flash Services PMI 52.8 vs 56.4 expected
Markets Update:
Asian markets showed mixed movements on Monday as investors reacted to China’s manufacturing and industrial profit data. Japan’s Nikkei 225 slipped 0.14%, while the Topix gained 0.68%. Chip-related stocks in Japan saw significant declines, with Advantest plunging 8.2%, Tokyo Electron losing 4.53%, and Renesas Electronics edging down 0.19%. The drop came amid concerns over Chinese AI startup DeepSeek’s open-source large-language model, seen as a potential challenge to U.S. dominance in AI technology.
In Hong Kong, the Hang Seng Index rose 0.89% at the open, while mainland China’s CSI 300 added 0.28%. However, China’s manufacturing sector faced a setback, with the January Purchasing Managers’ Index unexpectedly contracting to 49.1, below the forecasted 50.1. Despite this, December’s industrial profits in China jumped 11% year-over-year, offering some optimism amid broader economic challenges. Markets in Australia, Taiwan, and South Korea were closed for holidays.
To support its ailing stock market, China’s Securities Regulatory Commission (CSRC) announced measures to promote index investment products, including equity and bond ETFs. These initiatives, unveiled on Sunday, build on earlier efforts urging state-owned mutual funds and insurers to increase their equity holdings. Hong Kong, meanwhile, is set to release December trade data, which could further impact regional market sentiment.
In the U.S., markets ended a strong week on a softer note. The S&P 500 fell 0.3% to 6,101.24, the Nasdaq Composite lost 0.5% to 19,954.30, and the Dow Jones Industrial Average declined 140.82 points to 44,424.25. Investor enthusiasm surrounding Donald Trump’s return to the White House drove risk assets higher, with all three major indexes posting their second straight weekly gains, signaling renewed bullish momentum.
Upcoming Events:
03:00 PM GMT – USD New Home SalesIC Markets Europe Fundamental Forecast | 30 December 2024
By IC Markets
What happened in the Asia session?
Japan’s manufacturing sector has remained in contraction since July with the final PMI reading of 49.6 for December indicating no change to this trend. This sector saw softer deterioration in manufacturing conditions at the end of 2024 as production and demand fell slower than expected while there was a renewed increase in employment. The yen remains weak keeping USD/JPY elevated – this currency pair was hovering around 157.80 by midday Asia.
What does it mean for the Europe & US sessions?
After sliding lower over the last couple of months, the Chicago PMI is expected to rebound from 40.2 to 42.7 in December. However, this would still mark a 13th consecutive month of contraction in Chicago’s economic activity. Demand for the dollar could wane should we see this index post a weaker-than-anticipated result.
The Dollar Index (DXY)
Key news events today
Chicago PMI (2:45 pm GMT)
What can we expect from DXY today?
After sliding lower over the last couple of months, the Chicago PMI is expected to rebound from 40.2 to 42.7 in December. However, this would still mark a 13th consecutive month of contraction in Chicago’s economic activity. Demand for the dollar could wane should we see this index post a weaker-than-anticipated result.
Central Bank Notes:
- The Board of Governors of the Federal Reserve System voted by a majority to lower the Federal Funds Rate target range by 25 basis points to 4.25 to 4.50% on 18 December. Voting against the action was Beth M. Hammack, who preferred to maintain the target range at 4.5 to 4.75%.
- The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run and judges that the risks to achieving its employment and inflation goals are roughly in balance.
- The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.
- Recent indicators suggest that economic activity has continued to expand at a solid pace while labour market conditions have generally eased, and the unemployment rate has moved up but remains low.
- Inflation has made further progress toward the Committee’s 2% objective but remains somewhat elevated.
- The Summary of Economic Projections (SEP) now indicates just two rate cuts in 2025 totalling 50 bps, compared to the full percentage point of reductions projected in the previous quarter.
- GDP growth forecasts were revised upward for 2024 (2.5% vs to 2% in the September projection) and 2025 (2.1% vs 2%), while remaining steady at 2% for 2026. Similarly, PCE inflation projections have been adjusted higher for 2024 (2.4% vs 2.3%), 2025 (2.5% vs 2.1%), and 2026 (2.1% vs 2%).
- In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks.
- In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.
- In addition, the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities. Beginning in June, the Committee slowed the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $60 billion to $25 billion.
- The Committee will maintain the monthly redemption cap on agency debt and agency mortgage-backed securities at $35 billion and will reinvest any principal payments in excess of this cap into Treasury securities.
- The next meeting runs from 28 to 29 January 2025.
Next 24 Hours Bias
Weak Bearish
Gold (XAU)
Key news events today
Chicago PMI (2:45 pm GMT)
What can we expect from Gold today?
After sliding lower over the last couple of months, the Chicago PMI is expected to rebound from 40.2 to 42.7 in December. However, this would still mark a 13th consecutive month of contraction in Chicago’s economic activity. Demand for the dollar could wane should we see this index post a weaker-than-anticipated result – a move that would provide lift for gold prices.
Next 24 Hours Bias
Weak Bullish
The Australian Dollar (AUD)
Key news events today
No major news events.
What can we expect from AUD today?
The Aussie has fallen for five straight weeks to lose nearly 5% over this period. This currency pair opened at 0.6211 to edge towards 0.6230 as Asian markets came online.
Central Bank Notes:
- The RBA kept the cash rate target unchanged at 4.35% on 10 December, marking the ninth consecutive pause.
- Inflation has fallen substantially since the peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance. However, measures of underlying inflation are around 3.5%, which is still some way from the 2.5% midpoint of the inflation target.
The most recent forecasts published in the November Statement on Monetary Policy (SMP) do not see inflation returning sustainably to the midpoint of the target until 2026 but the Board is gaining some confidence that inflationary pressures are declining in line with these recent forecasts with risks remaining in place.
- Growth in output has been weak as the economy grew by only 0.8% in the September quarter over the past year. Outside of the COVID-19 pandemic, this was the slowest pace of growth since the early 1990s.
- A range of indicators suggest that labour market conditions remain tight; while those conditions have been easing gradually, some indicators have recently stabilised. The unemployment rate was 4.1 per cent in October, up from 3.5 per cent in late 2022.
- Wage pressures have eased more than expected in the November SMP. The rate of wages growth as measured by the Wage Price Index was 3.5% over the year to the September quarter, a step down from the previous quarter, but labour productivity growth remains weak.
- Sustainably returning inflation to target within a reasonable timeframe remains the Board’s highest priority. This is consistent with the RBA’s mandate for price stability and full employment. To date, longer term inflation expectations have been consistent with the inflation target and it is important that this remains the case.
The Board will continue to rely upon the data and the evolving assessment of risks to guide its decisions, paying close attention to developments in the global economy and financial markets, trends in domestic demand, and the outlook for inflation and the labour market.
- The next meeting is on 18 February 2025.
Next 24 Hours Bias
Weak Bullish
The Kiwi Dollar (NZD)
Key news events today
No major news events.
What can we expect from NZD today?
Just like its Pacific neighbour, the Kiwi has depreciated significantly as it tumbled 4.8% over the past four weeks. This currency pair opened at 0.5626 to drift higher at the beginning of the Asia session.
Central Bank Notes:
- The Monetary Policy Committee (MPC) agreed to reduce the Official Cash Rate (OCR) by 50 basis points bringing it down to 4.25% on 27 November, marking the third consecutive rate cut.
- The Committee assessed that annual consumer price inflation has declined and is now close to the midpoint of the MPC’s 1 to 3% target band; inflation expectations are also close to target and core inflation is converging to the midpoint.
- Economic activity remains subdued and output continues to be below its potential. With excess productive capacity in the economy, inflation pressures have eased. If economic conditions continue to evolve as projected, the Committee expects to be able to lower the OCR further early next year.
- Domestic economic activity remains below trend, as a result of weakness in demand for durable goods consumption and investment. This has been reflected in falling activity in interest rate sensitive sectors such as construction, manufacturing, and retail trade. In contrast, some services sectors have continued to grow.
- Consistent with feedback from business visits, high frequency indicators suggest that the economy has stabilised in recent months. Economic growth is expected to recover from the December quarter, in part due to lower interest rates, but there is uncertainty around the exact timing and speed of the recovery.
- Wage growth is slowing, consistent with inflation returning to the target midpoint while employment levels and job vacancies have declined, reflecting subdued economic activity; unemployment is expected to continue rising in the near term.
- Expectations of future inflation, the pricing intentions of firms, and spare productive capacity are consistent with the inflation target being sustainably achieved, providing the context and the confidence for the Committee to further ease monetary policy restraint.
- The next meeting is on 19 February 2025.
Next 24 Hours Bias
Weak Bullish
The Japanese Yen (JPY)
Key news events today
Manufacturing PMI (12:30 am GMT)
What can we expect from JPY today?
Japan’s manufacturing sector has remained in contraction since July with the final PMI reading of 49.6 for December indicating no change to this trend. This sector saw softer deterioration in manufacturing conditions at the end of 2024 as production and demand fell slower than expected while there was a renewed increase in employment. The yen remains weak keeping USD/JPY elevated – this currency pair was hovering around 157.80 by midday Asia.
Central Bank Notes:
- The Policy Board of the Bank of Japan decided on 19 December, by a 8-1 majority vote, to set the following guideline for money market operations for the intermeeting period:
- The Bank will encourage the uncollateralized overnight call rate to remain at around 0.25%.
- The Bank will embark on a plan to reduce the amount of its monthly outright purchases of JGBs so that it will be about 3 trillion yen in January-March 2026; the amount will be cut down by about 400 billion yen each calendar quarter in principle.
- Japan’s economy has recovered moderately, although some weakness has been seen in part. Exports and industrial production have been more or less flat while corporate profits have been on an improving trend and business sentiment has stayed at a favourable level.
- The employment and income situation has improved moderately while private consumption has been on a moderate increasing trend despite the impact of price rises and other factors.
- On the price front, the year-on-year rate of increase in the consumer price index (CPI, all items less fresh food) has been in the range of 2.0-2.5% recently, as services prices have continued to rise moderately, reflecting factors such as wage increases, although the effects of a passthrough to consumer prices of cost increases led by the past rise in import prices have waned; inflation expectations have risen moderately.
- With regard to the CPI (all items less fresh food), while the effects of the pass-through to consumer prices of cost increases led by the past rise in import prices are expected to wane, underlying CPI inflation is expected to increase gradually, since it is projected that the output gap will improve and that medium- to long-term inflation expectations will rise with a virtuous cycle between wages and prices continuing to intensify.
- Japan’s economy is likely to keep growing at a pace above its potential growth rate, with overseas economies continuing to grow moderately and as a virtuous cycle from income to spending gradually intensifies against the background of factors such as accommodative financial conditions.
- The next meeting is on 24 January 2025.
Next 24 Hours Bias
Weak Bearish
The Euro (EUR)
Key news events today
No major news events.
What can we expect from EUR today?
The Euro has tumbled nearly 1.3% over the last three weeks as it looks to re-test its 52-week low at 1.0331. This currency pair opened at 1.0426 and was edging higher towards 1.0440 as Asian markets came online.
Central Bank Notes:
- The Governing Council reduced the three key ECB interest rates by 25 basis points on 12 December to mark the third successive rate cut.
- Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be decreased to 3.15%, 3.40% and 3.00% respectively.
- The disinflation process is well on track and most measures of underlying inflation suggest that inflation will settle at around the Governing Council’s 2% medium-term target on a sustained basis.
- Staff see headline inflation averaging 2.4% in 2024, 2.1% in 2025, 1.9% in 2026 and 2.1% in 2027 when the expanded EU Emissions Trading System becomes operational. For inflation excluding energy and food, staff project an average of 2.9% in 2024, 2.3% in 2025 and 1.9% in both 2026 and 2027.
- Staff now expect a slower economic recovery than in the September projections. Although growth picked up in the third quarter of this year, survey indicators suggest it has slowed in the current quarter – the economy is expected to grow by 0.7% in 2024, 1.1% in 2025, 1.4% in 2026 and 1.3% in 2027
- The Eurosystem no longer reinvests all of the principal payments from maturing securities purchased under the pandemic emergency purchase programme (PEPP), reducing the PEPP portfolio by €7.5 billion per month on average and the Governing Council intends to discontinue reinvestments under the PEPP at the end of 2024.
- The Governing Council stands ready to adjust all of its instruments within its mandate to ensure that inflation stabilises sustainably at its 2% target over the medium term and to preserve the smooth functioning of monetary policy transmission.
- The next meeting is on 30 January 2025.
Next 24 Hours Bias
Weak Bullish
The Swiss Franc (CHF)
Key news events today
No major news events.
What can we expect from CHF today?
The franc has weakened significantly since the end of September with UDS/CHF rallying almost 7.5% over this period. This currency pair opened at 0.9010 before drifting lower at the beginning of the Asia session.
Central Bank Notes:
-The SNB eased monetary policy by lowering its key policy rate by 50 basis points, going from 1.00% to 0.50% on 12 December, marking for the fourth consecutive reduction.
Underlying inflationary pressure has decreased again this quarter.
- Inflation in the period since the last monetary policy assessment has again been lower than expected as it decreased from 1.1% in August to 0.7% in November; both goods and services contributed to this decline.
- In the shorter term, the new conditional inflation forecast is below that of September: 1.1% for 2024, 0.3% for 2025 and 0.8% for 2026, based on the assumption that the SNB policy rate is 0.5% over the entire forecast horizon.
- GDP growth in Switzerland was only modest in the third quarter of 2024 with growth in the services sector was again somewhat stronger, while value added in manufacturing declined.
- There was a further slight increase in unemployment, and employment growth was subdued while the utilisation of overall production capacity was
normal.
- The SNB anticipates GDP growth of around 1% this year while currently expecting growth of between 1.0% and 1.5% for 2025.
- The SNB will continue to monitor the situation closely, and will adjust its monetary policy if necessary to ensure inflation remains within the range consistent with price stability over the medium term.
- The next meeting is on 20 March 2025.
Next 24 Hours Bias
Weak Bearish
The Pound (GBP)
Key news events today
No major news events.
What can we expect from GBP today?
Just like many other currencies, the Pound has devalued strongly in the last quarter of this year with Cable breaking under the threshold of 1.2500 on 20th December. This currency pair opened at 1.2572 and was hovering around this level as Asian markets came online.
Central Bank Notes:
- The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 6 to 3 to maintain the Bank Rate at 4.75% on 19 December 2024 – three members preferred to reduce the Bank rate by 25 basis points, bringing it down to 4.50%.
- The MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes, and financed by the issuance of central bank reserves, by £100B over the next 12 months to a total of £558B, starting in October 2024. On 18 December 2024, the stock of UK government bonds held for monetary policy purposes was £655B.
- Twelve-month CPI inflation had increased to 2.6% in November from 1.7% in September, slightly higher than previous expectations while services consumer price inflation had remained elevated, at 5.0%, while core goods price inflation had risen to 1.1%.
- Headline CPI inflation was slightly higher than previous expectations, owing in large part to stronger inflation in core goods and food, and is expected to continue to rise slightly in the near term.
- Most indicators of UK near-term activity have declined with Bank staff expecting GDP growth to be weaker at the end of the year than originally projected in the November Monetary Policy Report.
- Bank staff now expected zero GDP growth in 2024 Q4, weaker than the 0.3% that had been incorporated in the November Report, broadly consistent with the latest combined steer from business surveys and the available official data.
- The Committee now judges that the labour market is broadly in balance as annual private sector regular average weekly earnings growth picked up quite sharply in the three months to October but there remains significant uncertainty around developments in the labour market.
- Monetary policy has been guided by the need to squeeze remaining inflationary pressures out of the economy to achieve the 2% target both in a timely manner and on a lasting basis. Over recent quarters there has been progress in disinflation, particularly as previous external shocks have abated, although remaining domestic inflationary pressures are resolving more slowly.
- The Committee continues to monitor closely the risks of inflation persistence and will assess the extent to which the evolving evidence is consistent with more constrained supply, which could sustain inflationary pressures, or with weaker demand, which could lead to the emergence of spare capacity in the economy and push down inflation; a gradual approach to removing monetary policy restraint remains appropriate.
- Monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further and the Committee will decide the appropriate degree of monetary policy restrictiveness at each meeting.
- The next meeting is on 6 February 2025.
Next 24 Hours Bias
Weak Bullish
The Canadian Dollar (CAD)
Key news events today
No major news events.
What can we expect from CAD today?
The Loonie has been one of the weakest currencies in 2024 causing USD/CAD to surge beyond 1.4450 in recent weeks. This currency pair opened at 1.4413 and is likely to remain elevated as the day progresses.
Central Bank Notes:
- The Bank of Canada reduced its target for the overnight rate by 50 basis points bringing it down to 3.25% while continuing its policy of balance sheet normalization on 11 December; this marked the fifth consecutive meeting where rates were reduced.
- Canada’s economy grew by 1% in the third quarter, somewhat below the Bank’s October projection, and the fourth quarter also looks weaker than projected. Third-quarter GDP growth was pulled down by business investment, inventories and exports.
- The unemployment rate rose to 6.8% in November as employment continued to grow more slowly than the labour force while wage growth showed some signs of easing, but remains elevated relative to productivity.
- Headline CPI has declined significantly from 2.7% in June to 1.6% in September while shelter costs inflation remains elevated but has begun to ease; the preferred measures of core inflation are now below 2.5%.
- CPI inflation has been about 2% since the summer, and is expected to average close to the 2% target over the next couple of years. Since October, the upward pressure on inflation from shelter and the downward pressure from goods prices have both moderated as expected.
- Looking ahead, the GST holiday will temporarily lower inflation but that will be unwound once the GST break ends. In addition, the possibility the incoming US administration will impose new tariffs on Canadian exports to the United States has increased uncertainty and clouded the economic outlook
- With inflation around 2%, the economy in excess supply, and recent indicators tilted towards softer growth than projected, the Governing Council decided to reduce the policy rate by a further 50 basis points to support growth and keep inflation close to the middle of the 1-3% target range.
- The Governing Council has reduced the policy rate substantially since June and going forward, they will be evaluating the need for further reductions in the policy rate one decision at a time.
- The Bank is committed to maintaining price stability for Canadians by keeping inflation close to the 2% target.
- The next meeting is on 29 January 2025.
Next 24 Hours Bias
Weak Bullish
Oil
Key news events today
No major news events.
What can we expect from Oil today?
After Friday’s larger-than-expected drawdown in the EIA inventories, crude oil prices are likely to remain buoyed on Monday. WTI oil was hovering around $70.50 per barrel as markets re-opened and this benchmark could continue its upward ascent towards the $72-mark.
Next 24 Hours Bias
Weak BullishTuesday 10th December 2024: Asian Markets Rally Amid China’s Stimulus Plans
By IC Markets
Global Markets:
Asian Stock Markets : Nikkei up 0.53%, Shanghai Composite up 1.22%, Hang Seng up 0.87% ASX down 0.36%
Commodities : Gold at $2691.35 (0.14%), Silver at $32.4 (-0.18%), Brent Oil at $71.4 (-0.46%), WTI Oil at $67.7 (-0.49%)
Rates : US 10-year yield at 4.193, UK 10-year yield at 4.2705, Germany 10-year yield at 2.1175
News & Data:
(USD) Final Wholesale Inventories m/m 0.2% vs 0.2% expected
Markets Update:
China’s stock markets rose on Tuesday, with the CSI 300 index gaining 1.9% and Hong Kong’s Hang Seng index up 0.9%, driven by Beijing’s announcement of “more proactive” fiscal policies and “moderately” looser monetary measures for the upcoming year. These changes aim to stimulate domestic consumption and were revealed in an official statement on Monday evening, which had already propelled the Hang Seng nearly 3% higher.
Elsewhere in Asia, South Korea’s Kospi surged 2.2%, while the small-cap Kosdaq soared 5.3%, with investors monitoring political developments. Yonhap reported that opposition leader Lee Jae Myung committed to passing a scaled-down budget later in the day. Meanwhile, Japan’s Nikkei 225 and Topix rose 0.52% and 0.37%, respectively. However, Australia’s S&P/ASX 200 dipped 0.36% after the Reserve Bank of Australia maintained its benchmark rate at 4.35%.
In the U.S., Wall Street retreated on Monday ahead of critical inflation data. The S&P 500 fell 0.61% to 6,052.85, the Nasdaq lost 0.62% to 19,736.69, and the Dow Jones declined 0.54%, closing at 44,401.93. Technology stocks, including Nvidia and AMD, faced significant declines. Nvidia dropped 2.6% after facing an antitrust investigation in China, while AMD fell 5.6%. Tech giants Meta and Netflix also saw losses.
Upcoming Events:
01:30 PM GMT – USD Revised Nonfarm Productivity q/q
01:30 PM GMT – USD Revised Unit Labor Costs q/qMonday 9th December 2024: Markets React to South Korea’s Political Unrest
By IC Markets
Global Markets:
Asian Stock Markets : Nikkei up 0.07%, Shanghai Composite down 0.14%, Hang Seng down 0.57% ASX up 0.02%
Commodities : Gold at $2659.35 (-0.14%), Silver at $31.4 (-0.48%), Brent Oil at $71.4 (0.46%), WTI Oil at $67.27 (0.49%)
Rates : US 10-year yield at 4.143, UK 10-year yield at 4.275, Germany 10-year yield at 2.1125
News & Data:
(USD) Non – Farm Employment Change 227K vs 218K expected
(USD) Unemployment Rate 4.2% vs 4.1% expected
(CAD) Employment Change 50.5K vs 24.7K expected
(CAD) Unemployment Rate 6.8% vs 6.6% expected
Markets Update:
South Korea’s Kospi index fell over 2% on Monday as political turmoil continued to weigh on investor sentiment following President Yoon Suk Yeol’s survival of an impeachment vote over the weekend. The benchmark Kospi dropped 2.5%, while the Kosdaq slid 4.4%, reflecting heightened concerns over the fallout from Yoon’s brief declaration of martial law. Adding to the tension, prosecutors have reportedly named Yoon as a subject of a criminal investigation for potential charges of treason and abuse of power.
The impeachment vote, led by opposition parties, was boycotted by Yoon’s People Power Party. However, the party’s leader has suggested that Yoon may consider stepping down, signaling further uncertainty in the political landscape. This development has fueled apprehension in the markets, with investors closely watching how the crisis unfolds.
Elsewhere in Asia-Pacific markets, performance was mixed. Japan’s Nikkei 225 inched up 0.1%, while the Topix added 0.2%, supported by a positive revision to Japan’s third-quarter GDP growth, now estimated at 0.3% quarter-on-quarter. Meanwhile, Hong Kong’s Hang Seng index dropped 0.6%, and mainland China’s CSI 300 declined 0.5%. China’s consumer price growth in November missed expectations, rising only 0.2% year-on-year compared to 0.3% in October, according to the National Bureau of Statistics.
In the U.S., markets ended last week on a high note. The S&P 500 gained 0.25% to 6,090.27, and the Nasdaq Composite climbed 0.81% to 19,859.77, bolstered by gains in Tesla, Meta Platforms, and Amazon. However, the Dow Jones Industrial Average dipped 0.28%, closing at 44,642.52. Both the S&P 500 and Nasdaq achieved their third consecutive week of gains, rising 0.96% and 3.34%, respectively, despite the Dow slipping 0.6% over the same period.
Upcoming Events:
03:00 PM GMT – USD Final Wholesale Inventories m/mFriday 1st November 2024: Asia-Pacific Markets Slide Following Wall Street Losses Amid Economic Unce
By IC Markets
IC Markets Global • Nov 1, 2024
IC Markets Europe Fundamental Forecast | 21 October 2024
By IC Markets
What happened in the Asia session?
Although RBA Deputy Governor Andrew Hauser comments in a fireside chat at the Commonwealth Bank of Australia Global Markets Conference in Sydney were hawkish, the Aussie reversed sharply from 0.6716 to break under 0.6700 to drop as low as 0.6687 this morning. Deputy Governor Hauser stated that “inflation is still too high and rates are unlikely to be cut in 2024”, reaffirming the RBA’s dual mandate of keeping prices stable between 2 and 3% while also supporting full employment. Persistent demand for the greenback is keeping the overhead pressures firm in place for the Aussie and this current downward momentum is likely to extend even lower today.
What does it mean for the Europe & US sessions?
There are not one but three Federal Reserve officials delivering their respective speeches in the latter part of the day. Federal Reserve Bank of Dallas President Lorie Logan will be participating in a moderated discussion at the Securities Industry and Financial Markets Association Annual Meeting in New York while Minneapolis President Neel Kashkari will be speaking at the Chippewa Falls Chamber of Commerce where audience questions are expected. And finally, Kansas City President Jeffrey Schmid speaks about the economic outlook and monetary policy at the Chartered Financial Analysts Society in Kansas City where audience questions are also expected. These events are likely to inject higher volatility for financial markets as the U.S. session commences.
The Dollar Index (DXY)
Key news events today
FOMC Member Logan Speaks (12:55 pm GMT)
FOMC Member Kashkari Speaks (5:00 pm GMT)
FOMC Member Schmid Speaks (9:05 pm GMT)
What can we expect from DXY today?
There are not one but three Federal Reserve officials delivering their respective speeches in the latter part of the day. Federal Reserve Bank of Dallas President Lorie Logan will be participating in a moderated discussion at the Securities Industry and Financial Markets Association Annual Meeting in New York while Minneapolis President Neel Kashkari will be speaking at the Chippewa Falls Chamber of Commerce where audience questions are expected. And finally, Kansas City President Jeffrey Schmid speaks about the economic outlook and monetary policy at the Chartered Financial Analysts Society in Kansas City where audience questions are also expected. These events are likely to inject higher volatility for financial markets as the U.S. session commences.
Central Bank Notes:
The Federal Funds Rate target range was reduced by 50 basis points to 4.75% to 5.00% on 18th September in an 11 to 1 vote with Governor Michelle Bowman dissenting, preferring to cut rates by a smaller amount.
The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run and has gained greater confidence that inflation is moving sustainably toward 2%, and judges that the risks to achieving its employment and inflation goals are roughly in balance.
The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.
Recent indicators suggest that economic activity has continued to expand at a solid pace while job gains have slowed, and the unemployment rate has moved up but remains low.
Inflation has made further progress toward the Committee’s 2% objective but remains somewhat elevated.
In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks and does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%.
In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.
In addition, the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities. Beginning in June, the Committee slowed the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $60 billion to $25 billion.
The Committee will maintain the monthly redemption cap on agency debt and agency mortgage-backed securities at $35 billion and will reinvest any principal payments in excess of this cap into Treasury securities.
Next meeting runs from 6 to 7 November 2024.
Next 24 Hours Bias
Medium Bearish
Gold (XAU)
Key news events today
FOMC Member Logan Speaks (12:55 pm GMT)
FOMC Member Kashkari Speaks (5:00 pm GMT)
FOMC Member Schmid Speaks (9:05 pm GMT)
What can we expect from Gold today?
There are not one but three Federal Reserve officials delivering their respective speeches in the latter part of the day. Federal Reserve Bank of Dallas President Lorie Logan will be participating in a moderated discussion at the Securities Industry and Financial Markets Association Annual Meeting in New York while Minneapolis President Neel Kashkari will be speaking at the Chippewa Falls Chamber of Commerce where audience questions are expected. And finally, Kansas City President Jeffrey Schmid speaks about the economic outlook and monetary policy at the Chartered Financial Analysts Society in Kansas City where audience questions are also expected. These events are likely to inject higher volatility for gold prices as the U.S. session commences.
Next 24 Hours Bias
Medium Bullish
The Australian Dollar (AUD)
Key news events today
RBA Deputy Gov Hauser Speaks (1:00 am GMT)
What can we expect from AUD today?
Although RBA Deputy Governor Andrew Hauser comments in a fireside chat at the Commonwealth Bank of Australia Global Markets Conference in Sydney were hawkish, the Aussie reversed sharply from 0.6716 to break under 0.6700 to drop as low as 0.6687 this morning. Deputy Governor Hauser stated that “inflation is still too high and rates are unlikely to be cut in 2024”, reaffirming the RBA’s dual mandate of keeping prices stable between 2 and 3% while also supporting full employment. Persistent demand for the greenback is keeping the overhead pressures firm in place for the Aussie and this current downward momentum is likely to extend even lower today.
Central Bank Notes:
The RBA kept the cash rate target unchanged at 4.35% on 24th September, marking the seventh consecutive pause.
Inflation has fallen substantially since its peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance but it is still some way above the midpoint of the 2 to 3% target range.
The trimmed-mean CPI was 3.9% YoY in the June quarter, broadly as forecast in the May Statement on Monetary Policy (SMP) while headline inflation declined in July as measured by the monthly CPI indicator.
Headline inflation is expected to fall further temporarily but current forecasts do not see inflation returning sustainably to target until 2026.
GDP data for the June quarter have confirmed that growth has been weak but growth in aggregate consumer demand, which includes spending by temporary residents such as students and tourists, remained more resilient.
Broader indicators suggest that labour market conditions remain tight, despite some signs of gradual easing while wage pressures have eased somewhat.
Data since then have reinforced the need to remain vigilant to upside risks to inflation and the Board is not ruling anything in or out while agreeing that policy will need to be sufficiently restrictive until the Board is confident that inflation is moving sustainably towards the target range.
The Board will continue to rely upon the data and the evolving assessment of risks to guide its decisions and will pay close attention to developments in the global economy and financial markets, trends in domestic demand, and the outlook for inflation and the labour market.
Next meeting is on 5 November 2024.
Next 24 Hours Bias
Medium Bullish
The Kiwi Dollar (NZD)
Key news events today
No major news events.
What can we expect from NZD today?
The Kiwi has weakened considerably over the past three weeks losing 4.3% to shed 270 pips. This currency pair stabilized around 0.6050 towards the end of last week and was rising towards 0.6100 at the beginning of the Asia session – these are the support and resistance levels for today.
Support: 0.6050
Resistance: 0.6120
Central Bank Notes:
The Monetary Policy Committee agreed to reduce the OCR by 50 basis points, bringing it down to 4.75% in October as inflation converges to target.
The Committee assesses that annual consumer price inflation is within its 1 to 3% inflation target range and converging on the 2% midpoint.
Economic activity in New Zealand is subdued, in part due to restrictive monetary policy while business investment and consumer spending have been weak, and employment conditions continue to soften.
The economy is now in a position of excess capacity, encouraging price- and wage-setting to adjust to a low-inflation economy; lower import prices have assisted the disinflation.
High-frequency indicators point to continued subdued growth in the near term, mostly due to weak consumer spending and business investment while labour market conditions are expected to ease further, with filled jobs and advertised vacancy rates continuing to decline.
The Committee confirmed that future changes to the OCR would depend on its evolving assessment of the economy.
Next meeting is on 27 November 2024.
Next 24 Hours Bias
Medium Bullish
The Japanese Yen (JPY)
Key news events today
No major news events.
What can we expect from JPY today?
Demand for the greenback waned last Friday and that momentum has flowed over to Monday as markets re-opened causing USD/JPY to slide towards 149. After hitting a high of 150.32 last Thursday, this currency pair looks to be running out of steam as Asian markets came online – these are the support and resistance levels for today.
Support: 148.10
Resistance: 150.30
Central Bank Notes:
The Policy Board of the Bank of Japan decided, by a unanimous vote, to set the following guideline for money market operations for the intermeeting period:
The Bank will encourage the uncollateralized overnight call rate to remain at around 0.25%
The Bank will embark on a plan to reduce the amount of its monthly outright purchases of JGBs so that it will be about 3 trillion yen in January-March 2026; the amount will be cut down by about 400 billion yen each calendar quarter in principle.
The year-on-year rate of increase in the consumer price index (CPI, all items less fresh food) has been in the range of 2.5 to 3.0% recently, as services prices have continued to rise moderately, reflecting factors such as wage increases, although the effects of a passthrough to consumer prices of cost increases led by the past rise in import prices have waned.
Meanwhile, underlying CPI inflation is expected to increase gradually, since it is projected that the output gap will improve and that medium- to long-term inflation expectations will rise with a virtuous cycle between wages and prices continuing to intensify.
In the second half of the projection period of the July 2024 Outlook for Economic Activity and Prices, it is likely to be at a level that is generally consistent with the price stability target.
Japan’s economy has recovered moderately, although some weakness has been seen in part, but it is likely to keep growing at a pace above its potential growth rate, with overseas economies continuing to grow moderately and as a virtuous cycle from income to spending gradually intensifies against the background of factors such as accommodative financial conditions.
Next meeting is on 31 October 2024.
Next 24 Hours Bias
Medium Bearish
The Euro (EUR)
Key news events today
No major news events.
What can we expect from EUR today?
The Euro has lost 2.7% over the past three weeks to fall nearly 280 pips. This currency pair stabilized around 1.0825 towards the end of last week and rebounded strongly last Friday. This currency pair was hovering around 1.0860 at the beginning of the Asia session – these are the support and resistance levels for today.
Support: 1.0825
Resistance: 1.0910
Central Bank Notes:
The Governing Council today decided to reduce the three key ECB interest rates by 25 basis points on 17th October to mark the second successive rate cut.
Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be decreased to 3.40%, 3.65% and 3.25% respectively.
The incoming information on inflation shows that the disinflationary process is well on track while the inflation outlook is also affected by recent downside surprises in indicators of economic activity.
Inflation is expected to rise in the coming months, before declining to target in the course of next year. Domestic inflation remains high, as wages are still rising at an elevated pace. At the same time, labour cost pressures are set to continue easing gradually, with profits partially buffering their impact on inflation.
The Eurosystem no longer reinvests all of the principal payments from maturing securities purchased under the pandemic emergency purchase programme (PEPP), reducing the PEPP portfolio by €7.5 billion per month on average and the Governing Council intends to discontinue reinvestments under the PEPP at the end of 2024.
The Council is determined to ensure that inflation returns to its 2% medium-term target in a timely manner and will keep policy rates sufficiently restrictive for as long as necessary to achieve this aim and is not pre-committing to a particular rate path.
Next meeting is on 12 December 2024.
Next 24 Hours Bias
Weak Bullish
The Swiss Franc (CHF)
Key news events today
No major news events.
What can we expect from CHF today?
Higher demand for the dollar lifted USD/CHF above 0.8650 last week before pulling back slightly on to close at 0.8647 on Friday. This currency pair was floating around 0.8650 as Asian markets came online and could grind higher as the day progresses – these are the support and resistance levels for today.
Support: 0.8610
Resistance: 0.8720
Central Bank Notes:
The SNB eased monetary policy by lowering its key policy rate by 25 basis points for the third consecutive meeting, going from 1.25% to 1.00% in September.
Inflationary pressure has again decreased significantly compared to the previous quarter, reflecting the appreciation of the Swiss franc over the last three months.
Inflation in the period since the last monetary policy assessment was lower than expected, standing at 1.1% in August compared to 1.4% in May.
The new conditional inflation forecast is significantly lower than that of June: 1.2% for 2024, 0.6% for 2025 and 0.7% for 2026, based on the assumption that the SNB policy rate is 1.0% over the entire forecast horizon.
Swiss GDP growth was solid in the second quarter of 2024 as momentum in the chemicals/pharmaceuticals industry was particularly strong.
However, growth is likely to remain rather modest in the coming quarters due to the recent appreciation of the Swiss franc and the moderate development of the global economy.
The SNB anticipates GDP growth of around 1% this year while currently expecting growth of around 1.5% for 2025.
Further cuts in the SNB policy rate may become necessary in the coming quarters to ensure price stability over the medium term.
Next meeting is on 12 December 2024.
Next 24 Hours Bias
Weak Bullish
The Pound (GBP)
Key news events today
No major news events.
What can we expect from GBP today?
Stronger-than-anticipated sales acted as a shot in the arm for the Cable as it initially surged from 1.3023 to as high as 1.3070, marking the day’s high, before fizzling out. This currency pair made a second attempt to rally towards this level before again running out of steam and finally settling at 1.3049 as markets closed on Friday. This currency pair was hovering around 1.3050 at the beginning of the Asia session – these are the support and resistance levels for today.
Support: 1.2980
Resistance: 1.315
Central Bank Notes:
The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 8 to 1 to maintain Bank Rate at 5.0% while one member preferred to reduce Bank Rate by 25 basis points to 4.75%, on19th September 2024.
The MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes, and financed by the issuance of central bank reserves, by £100B over the next 12 months to a total of £558B.
Twelve-month CPI inflation had been 2.2% in August and July, slightly lower than August Report expectations. Consumer core goods and food price inflation had remained subdued as the cost pressures from previous global shocks had unwound further, and producer price levels had been broadly flat while energy prices had continued to drag on CPI inflation.
Services price inflation had increased to 5.6% in August compared to 5.2% in July and 5.7% in June. This was slightly lower in August than had been expected at the time of the August Report. There had been volatility in a number of services sub-components in the July and August outturns, including accommodation and catering prices and airfares.
GDP had increased by 0.6% in 2024 Q2, 0.1 percentage points lower than had been expected in the August Monetary Policy Report. That had followed 0.7% growth in Q1, but Bank staff judged that the underlying pace of growth had been somewhat weaker during the first half of the year.
Headline GDP growth was expected to return to its underlying pace of around 0.3% per quarter in the second half of the year. Based on a broad set of indicators, the MPC judged that the labour market continued to loosen but that it remained tight by historical standards.
Monetary policy decisions have been guided by the need to squeeze persistent inflationary pressures out of the system so as to return CPI inflation to the 2% target both in a timely manner and on a lasting basis; policy has been acting to ensure that inflation expectations remain well anchored.
In the absence of material developments, a gradual approach to removing policy restraint remains appropriate while monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further.
The Committee continues to monitor closely the risks of inflation persistence and will decide the appropriate degree of monetary policy restrictiveness at each meeting.
Next meeting is on 7 November 2024.
Next 24 Hours Bias
Weak Bullish
The Canadian Dollar (CAD)
Key news events today
No major news events.
What can we expect from CAD today?
The Loonie has depreciated significantly since the beginning of October to provide a huge tailwind for USD/CAD as it gained over 2.3% over this period. This currency pair gapped slightly lower at today’s open before edging above the threshold of 1.3800 at the beginning of the Asia session – these are the support and resistance levels for today.
Support: 1.3750
Resistance: 1.3840
Central Bank Notes:
The Bank of Canada reduced its target for the overnight rate by 25 basis points for the third consecutive meeting to 4.25% while continuing its policy of balance sheet normalization on 4th September.
Canada’s economy grew 2.1% in the second quarter of 2024, led by government spending and business investment.
This second quarter GDP growth was slightly stronger than forecast in July, but preliminary indicators suggest that economic activity was soft through June and July.
As expected, inflation slowed further to 2.5% in July. The Bank’s preferred measures of core inflation averaged around 2.5% and the share of components of the consumer price index growing above 3% is roughly at its historical norm.
High shelter price inflation is still the biggest contributor to total inflation but is starting to slow while inflation also remains elevated in some other services.
The labour market continues to slow, with little change in employment in recent months. Wage growth, however, remains elevated relative to productivity.
The Governing Council is carefully assessing these opposing forces on inflation and monetary policy decisions will be guided by incoming information and our assessment of their implications for the inflation outlook.
The Bank remains resolute in its commitment to restoring price stability for Canadians.
Next meeting is on 23 October 2024.
Next 24 Hours Bias
Weak Bullish
Oil
Key news events today
No major news events.
What can we expect from Oil today?
Prices for crude oil dived sharply last week to plunge as much as 8.5% with WTI oil plummeting from $75.15 to drop as low as $68.85 before closing at $69.53 per barrel on Friday. This latest decline marked the largest week fall since January and crude prices are expected to remain under pressure as the new trading week commences – this benchmark was floating around $68.70 as markets re-opened today.
Next 24 Hours Bias
Medium BearishTuesday 15th October 2024: Asia-Pacific Markets Mixed Amid Record Gains on Wall Street
By IC Markets
Global Markets:
Asian Stock Markets : Nikkei up 1.24%, Shanghai Composite down 1.06%, Hang Seng down 1.8% ASX up 0.79%
Commodities : Gold at $2657.35 -(0.24%), Silver at $31.10 (-0.54%), Brent Oil at $74.14 (-3.66%), WTI Oil at $70.98 (-3.52%)
Rates : US 10-year yield at 4.093, UK 10-year yield at 4.240, Germany 10-year yield at 2.276
News & Data:
(CNY) Trade Balance 583B vs 651B expected
Markets Update:
Asia-Pacific markets were mixed on Tuesday, following record-breaking gains on Wall Street, where both the Dow Jones Industrial Average and the S&P 500 reached new all-time highs. Investors in the region were focused on trade data from South Korea, which reported a sharp rise in trade surplus, jumping to $6.7 billion in September from $3.7 billion in August. Despite this, South Korea’s Kospi and the small-cap Kosdaq indexes remained mostly flat.
In China, the mainland CSI 300 index fell by 0.5%, recovering some ground after an earlier drop of more than 1%. Meanwhile, Hong Kong’s Hang Seng index declined by 1.8%. China’s September trade data, released after markets closed on Monday, missed expectations, with exports increasing by 2.4% year-over-year and imports up by just 0.3%.
Japan’s Nikkei 225 performed strongly, rising by 1.3%, while the broader Topix index gained 1%. Australia’s S&P/ASX 200 also saw positive movement, climbing 0.8%. Despite regional differences, some markets in Asia benefited from the positive sentiment carried over from Wall Street.
In the U.S., the S&P 500 rose 0.77% to 5,859.85, while the Dow Jones Industrial Average gained 201.36 points to close at 43,065.22, marking its first close above the 43,000 level. The Nasdaq Composite also saw growth, advancing 0.87% to finish at 18,502.69. The record highs in the U.S. markets fueled optimism but were met with mixed reactions across Asia.
Upcoming Events:
12:30 PM GMT – CAD CPI m/m
12:30 PM GMT – CAD Median CPI y/y
12:30 PM GMT – CAD Trimmed CPI y/y
12:30 PM GMT – CAD Common CPI y/yIC Markets Europe Fundamental Forecast | 11 October 2024
By IC Markets
IC Markets Europe Fundamental Forecast | 11 October 2024
Thursday 10th October 2024: Asia-Pacific Markets Rally After Wall Street Gains
By IC Markets
Global Markets:
- Asian Stock Markets : Nikkei up 0.29%, Shanghai Composite up 1.36%, Hang Seng up 3.08% ASX up 0.43%
- Commodities : Gold at $2629.35 (0.14%), Silver at $30.70 (0.04%), Brent Oil at $76.91 (0.66%), WTI Oil at $73.56 (0.52%)
- Rates : US 10-year yield at 4.078, UK 10-year yield at 4.182, Germany 10-year yield at 2.2745
News & Data:
(USD) Crude Oil Inventories 5.8M vs 2.0M expected
Markets Update:
Asia-Pacific markets traded higher on Thursday, buoyed by Wall Street gains that saw the S&P 500 and Dow Jones Industrial Average hit new records as investors brushed aside geopolitical concerns.
Australia’s S&P/ASX 200 rose 0.43% to 8,223 points, while South Korea’s Kospi added 0.34% to close at 2,603.25. Japan’s Nikkei 225 increased 0.26% to 39,380.89, and the Topix gained 0.2% to 2,712.67. Traders were digesting Japan’s September producer price data, which showed a 2.8% increase year-on-year, exceeding expectations of 2.3%.
Chinese stocks rebounded, with the CSI 300 rising nearly 3% and Hong Kong’s Hang Seng index climbing over 4%. The rebound followed a temporary halt in a rally driven by government stimulus measures. China’s central bank began accepting applications for a new liquidity tool worth 500 billion yuan ($70.7 billion) to ease capital access for the stock market.
Japan’s Seven & i Holdings saw a modest 0.6% rise ahead of its earnings report, with attention on restructuring plans following a revised buyout offer from Alimentation Couche-Tard Inc.
In the U.S., the S&P 500 surged 0.71% to close at 5,792.04, while the Dow Jones gained 431.63 points (1.03%) to end at 42,512. The Nasdaq Composite also rose 0.6% to 18,291.62. Wall Street’s gains were supported by the Federal Reserve’s September meeting minutes and despite ongoing Middle East tensions. Investors await U.S. consumer price data, with core inflation expected to hold steady at 3.2%.
Upcoming Events:
12:30 PM GMT – USD Core Retail Sales m/m
12:30 PM GMT – USD Core PPI m/m
12:30 PM GMT – USD PPI m/m
12:30 PM GMT – USD Unemployment ClaimsIC Markets Europe Fundamental Forecast | 9 October 2024
By IC Markets
What happened in the Asia session?
After reducing its Official Cash Rate (OCR) by 25 basis points (bps) in August, the Reserve Bank of New Zealand (RBNZ) moved ahead with a jumbo rate cut of 50 bps this morning as widely anticipated. The OCR now stands at 4.75% reducing the monetary restraint as inflation falls within the RBNZ’s target range of 1 to 3% and converges towards the 2% mid-point. Economic activity in New Zealand is subdued, in part due to restrictive monetary policy while business investment and consumer spending have been weak, and employment conditions continue to soften.
The Committee agreed that excess capacity has dampened inflation expectations, and price and wage changes are now more consistent with a low-inflation environment. Selling pressures for the Kiwi intensified following this rate cut announcement causing it to dive under the 0.6100- threshold with ease. This currency pair was trading around 0.6085 by midday Asia and is likely to slide lower as the day progresses.
What does it mean for the Europe & US sessions?
Germany’s trade surplus narrowed sharply in July, falling from €20.4B in the previous month to €16.8B as exports to China, the U.K. and the U.S. all shrank with shipments bound for China tumbling 8% MoM – July’s figures also marked the smallest trade surplus for Europe’s powerhouse economy. However, the estimate for August points to an improvement with surplus expected to wide to €18.9B which could provide a much-needed lift for the Euro before the start of the European trading hours.
The Dollar Index (DXY)
Key news events today
FOMC Meeting Minutes (6:00 pm GMT)
What can we expect from DXY today?
After reducing the Fed Funds Rate by 50 basis points in September, the minutes will provide further insights into the deliberations that took place during that FOMC meeting that led the Federal Reserve to move ahead with this jumbo cut. Any further dovish information gleaned from the minutes could cap the recent gains in the dollar which has seen a renewed surge in demand following last Friday’s non-farm payrolls report.
Central Bank Notes:
The Federal Funds Rate target range was reduced by 50 basis points to 4.75% to 5.00% on 18th September in an 11 to 1 vote with Governor Michelle Bowman dissenting, preferring to cut rates by a smaller amount.
The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run and has gained greater confidence that inflation is moving sustainably toward 2%, and judges that the risks to achieving its employment and inflation goals are roughly in balance.
The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.
Recent indicators suggest that economic activity has continued to expand at a solid pace while job gains have slowed, and the unemployment rate has moved up but remains low.
Inflation has made further progress toward the Committee’s 2% objective but remains somewhat elevated.
In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks and does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%.
In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.
In addition, the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities. Beginning in June, the Committee slowed the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $60 billion to $25 billion.
The Committee will maintain the monthly redemption cap on agency debt and agency mortgage-backed securities at $35 billion and will reinvest any principal payments in excess of this cap into Treasury securities.
Next meeting runs from 6 to 7 November 2024.
Next 24 Hours Bias
Weak Bearish
Gold (XAU)
Key news events today
FOMC Meeting Minutes (6:00 pm GMT)
What can we expect from Gold today?
After reducing the Fed Funds Rate by 50 basis points in September, the minutes will provide further insights into the deliberations that took place during that FOMC meeting that led the Federal Reserve to move ahead with this jumbo cut. Any further dovish information gleaned from the minutes could cap the recent gains in the dollar which has seen a renewed surge in demand following last Friday’s non-farm payrolls report, a move that could lift gold prices higher.
Next 24 Hours Bias
Weak Bearish
The Australian Dollar (AUD)
Key news events today
No major news events.
What can we expect from AUD today?
With no major news overnight, the Aussie stabilized around 0.6720 on Tuesday. This currency pair was trading around 0.6740 as Asian markets came online – these are the support and resistance levels for today.
Support: 0.6730
Resistance: 0.6770
Central Bank Notes:
The RBA kept the cash rate target unchanged at 4.35% on 24th September, marking the seventh consecutive pause.
Inflation has fallen substantially since its peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance but it is still some way above the midpoint of the 2 to 3% target range.
The trimmed-mean CPI was 3.9% YoY in the June quarter, broadly as forecast in the May Statement on Monetary Policy (SMP) while headline inflation declined in July as measured by the monthly CPI indicator.
Headline inflation is expected to fall further temporarily but current forecasts do not see inflation returning sustainably to target until 2026.
GDP data for the June quarter have confirmed that growth has been weak but growth in aggregate consumer demand, which includes spending by temporary residents such as students and tourists, remained more resilient.
Broader indicators suggest that labour market conditions remain tight, despite some signs of gradual easing while wage pressures have eased somewhat.
Data since then have reinforced the need to remain vigilant to upside risks to inflation and the Board is not ruling anything in or out while agreeing that policy will need to be sufficiently restrictive until the Board is confident that inflation is moving sustainably towards the target range.
The Board will continue to rely upon the data and the evolving assessment of risks to guide its decisions and will pay close attention to developments in the global economy and financial markets, trends in domestic demand, and the outlook for inflation and the labour market.
Next meeting is on 5 November 2024.
Next 24 Hours Bias
Weak Bullish
The Kiwi Dollar (NZD)
Key news events today
RBNZ Monetary Policy Statement (1:00 am GMT)
What can we expect from NZD today?
After reducing its Official Cash Rate (OCR) by 25 basis points (bps) in August, the Reserve Bank of New Zealand (RBNZ) moved ahead with a jumbo rate cut of 50 bps this morning as widely anticipated. The OCR now stands at 4.75% reducing the monetary restraint as inflation falls within the RBNZ’s target range of 1 to 3% and converges towards the 2% mid-point. Economic activity in New Zealand is subdued, in part due to restrictive monetary policy while business investment and consumer spending have been weak, and employment conditions continue to soften.
The Committee agreed that excess capacity has dampened inflation expectations, and price and wage changes are now more consistent with a low-inflation environment. Selling pressures for the Kiwi intensified following this rate cut announcement causing it to dive under the 0.6100- threshold with ease. This currency pair was trading around 0.6085 by midday Asia and is likely to slide lower as the day progresses.
Central Bank Notes:
The Monetary Policy Committee agreed to reduce the OCR by 50 basis points, bringing it down to 4.75% in October as inflation converges to target.
The Committee assesses that annual consumer price inflation is within its 1 to 3% inflation target range and converging on the 2% midpoint.
Economic activity in New Zealand is subdued, in part due to restrictive monetary policy while business investment and consumer spending have been weak, and employment conditions continue to soften.
The economy is now in a position of excess capacity, encouraging price- and wage-setting to adjust to a low-inflation economy; lower import prices have assisted the disinflation.
High-frequency indicators point to continued subdued growth in the near term, mostly due to weak consumer spending and business investment while labour market conditions are expected to ease further, with filled jobs and advertised vacancy rates continuing to decline.
The Committee confirmed that future changes to the OCR would depend on its evolving assessment of the economy.
Next meeting is on 27 November 2024.
Next 24 Hours Bias
Medium Bearish
The Japanese Yen (JPY)
Key news events today
No major news events.
What can we expect from JPY today?
Demand for the dollar remains strong keeping USD/JPY elevated. This currency pair climbed above 148 overnight and was rising towards 148.50 as Asian markets came online – these are the support and resistance levels for today.
Support: 147.10
Resistance: 149.40
Central Bank Notes:
The Policy Board of the Bank of Japan decided, by a unanimous vote, to set the following guideline for money market operations for the intermeeting period:
The Bank will encourage the uncollateralized overnight call rate to remain at around 0.25%
The Bank will embark on a plan to reduce the amount of its monthly outright purchases of JGBs so that it will be about 3 trillion yen in January-March 2026; the amount will be cut down by about 400 billion yen each calendar quarter in principle.
The year-on-year rate of increase in the consumer price index (CPI, all items less fresh food) has been in the range of 2.5 to 3.0% recently, as services prices have continued to rise moderately, reflecting factors such as wage increases, although the effects of a passthrough to consumer prices of cost increases led by the past rise in import prices have waned.
Meanwhile, underlying CPI inflation is expected to increase gradually, since it is projected that the output gap will improve and that medium- to long-term inflation expectations will rise with a virtuous cycle between wages and prices continuing to intensify.
In the second half of the projection period of the July 2024 Outlook for Economic Activity and Prices, it is likely to be at a level that is generally consistent with the price stability target.
Japan’s economy has recovered moderately, although some weakness has been seen in part, but it is likely to keep growing at a pace above its potential growth rate, with overseas economies continuing to grow moderately and as a virtuous cycle from income to spending gradually intensifies against the background of factors such as accommodative financial conditions.
Next meeting is on 31 October 2024.
Next 24 Hours Bias
Weak Bearish
The Euro (EUR)
Key news events today
Germany Trade Balance (6:00 am GMT)
What can we expect from EUR today?
Germany’s trade surplus narrowed sharply in July, falling from €20.4B in the previous month to €16.8B as exports to China, the U.K. and the U.S. all shrank with shipments bound for China tumbling 8% MoM – July’s figures also marked the smallest trade surplus for Europe’s powerhouse economy. However, the estimate for August points to an improvement with surplus expected to wide to €18.9B which could provide a much-needed lift for the Euro before the start of the European trading hours.
Central Bank Notes:
The Governing Council today decided to reduce the three key ECB interest rates on 12th September, after holding rates steady in July.
Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will be decreased to 3.65%, 3.90% and 3.50% respectively.
Recent inflation data have come in broadly as expected, and the latest ECB staff projections see headline inflation averaging 2.5% in 2024, 2.2% in 2025 and 1.9% in 2026.
For core inflation, the projections for 2024 and 2025 have been revised up slightly, as services inflation has been higher than expected. At the same time, staff continue to expect a rapid decline in core inflation, from 2.9% this year to 2.3% in 2025 and 2.0% in 2026.
ECB staff projections forecast that the economy will grow by 0.8% in 2024, rising to 1.3% in 2025 and 1.5% in 2026 which is a slight downward revision compared with the June projections, mainly owing to a weaker contribution from domestic demand over the next few quarters.
The Eurosystem no longer reinvests all of the principal payments from maturing securities purchased under the pandemic emergency purchase programme (PEPP), reducing the PEPP portfolio by €7.5 billion per month on average and the Governing Council intends to discontinue reinvestments under the PEPP at the end of 2024.
The Council is determined to ensure that inflation returns to its 2% medium-term target in a timely manner and will keep policy rates sufficiently restrictive for as long as necessary to achieve this aim and is not pre-committing to a particular rate path.
Next meeting is on 17 October 2024.
Next 24 Hours Bias
Weak Bullish
The Swiss Franc (CHF)
Key news events today
No major news events.
What can we expect from CHF today?
Demand for the dollar remains intact keeping USD/CHF elevated. This currency pair climbed above 0.8550 and was rising towards 0.8580 at the beginning of the Asis session – these are the support and resistance levels for today.
Support: 0.8510
Resistance: 0.8630
Central Bank Notes:
The SNB eased monetary policy by lowering its key policy rate by 25 basis points for the third consecutive meeting, going from 1.25% to 1.00% in September.
Inflationary pressure has again decreased significantly compared to the previous quarter, reflecting the appreciation of the Swiss franc over the last three months.
Inflation in the period since the last monetary policy assessment was lower than expected, standing at 1.1% in August compared to 1.4% in May.
The new conditional inflation forecast is significantly lower than that of June: 1.2% for 2024, 0.6% for 2025 and 0.7% for 2026, based on the assumption that the SNB policy rate is 1.0% over the entire forecast horizon.
Swiss GDP growth was solid in the second quarter of 2024 as momentum in the chemicals/pharmaceuticals industry was particularly strong.
However, growth is likely to remain rather modest in the coming quarters due to the recent appreciation of the Swiss franc and the moderate development of the global economy.
The SNB anticipates GDP growth of around 1% this year while currently expecting growth of around 1.5% for 2025.
Further cuts in the SNB policy rate may become necessary in the coming quarters to ensure price stability over the medium term.
Next meeting is on 12 December 2024.
Next 24 Hours Bias
Weak Bullish
The Pound (GBP)
Key news events today
No major news events.
What can we expect from GBP today?
Cable was relatively unmoved as it hovered around 1.3090 for most parts of the U.S. session. This currency pair was attempting to rise above 1.3100 at the beginning of the Asia session and could continue its ascent as the day progresses – these are the support and resistance levels for today.
Support: 1.3030
Resistance: 1.3230
Central Bank Notes:
The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 8 to 1 to maintain Bank Rate at 5.0% while one member preferred to reduce Bank Rate by 25 basis points to 4.75%, on19th September 2024.
The MPC also voted unanimously to reduce the stock of UK government bond purchases held for monetary policy purposes, and financed by the issuance of central bank reserves, by £100B over the next 12 months to a total of £558B.
Twelve-month CPI inflation had been 2.2% in August and July, slightly lower than August Report expectations. Consumer core goods and food price inflation had remained subdued as the cost pressures from previous global shocks had unwound further, and producer price levels had been broadly flat while energy prices had continued to drag on CPI inflation.
Services price inflation had increased to 5.6% in August compared to 5.2% in July and 5.7% in June. This was slightly lower in August than had been expected at the time of the August Report. There had been volatility in a number of services sub-components in the July and August outturns, including accommodation and catering prices and airfares.
GDP had increased by 0.6% in 2024 Q2, 0.1 percentage points lower than had been expected in the August Monetary Policy Report. That had followed 0.7% growth in Q1, but Bank staff judged that the underlying pace of growth had been somewhat weaker during the first half of the year.
Headline GDP growth was expected to return to its underlying pace of around 0.3% per quarter in the second half of the year. Based on a broad set of indicators, the MPC judged that the labour market continued to loosen but that it remained tight by historical standards.
Monetary policy decisions have been guided by the need to squeeze persistent inflationary pressures out of the system so as to return CPI inflation to the 2% target both in a timely manner and on a lasting basis; policy has been acting to ensure that inflation expectations remain well anchored.
In the absence of material developments, a gradual approach to removing policy restraint remains appropriate while monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further.
The Committee continues to monitor closely the risks of inflation persistence and will decide the appropriate degree of monetary policy restrictiveness at each meeting.
Next meeting is on 7 November 2024.
Next 24 Hours Bias
Weak Bullish
The Canadian Dollar (CAD)
Key news events today
No major news events.
What can we expect from CAD today?
With oil prices plunging on Tuesday, demand for the Loonie waned significantly to propel USD/CAD to an overnight high of 1.3675. This currency pair pulled back towards 1.3650 as Asian markets came online – these are the support and resistance levels for today.
Support: 1.3635
Resistance: 1.3730
Central Bank Notes:
The Bank of Canada reduced its target for the overnight rate by 25 basis points for the third consecutive meeting to 4.25% while continuing its policy of balance sheet normalization on 4th September.
Canada’s economy grew 2.1% in the second quarter of 2024, led by government spending and business investment.
This second quarter GDP growth was slightly stronger than forecast in July, but preliminary indicators suggest that economic activity was soft through June and July.
As expected, inflation slowed further to 2.5% in July. The Bank’s preferred measures of core inflation averaged around 2.5% and the share of components of the consumer price index growing above 3% is roughly at its historical norm.
High shelter price inflation is still the biggest contributor to total inflation but is starting to slow while inflation also remains elevated in some other services.
The labour market continues to slow, with little change in employment in recent months. Wage growth, however, remains elevated relative to productivity.
The Governing Council is carefully assessing these opposing forces on inflation and monetary policy decisions will be guided by incoming information and our assessment of their implications for the inflation outlook.
The Bank remains resolute in its commitment to restoring price stability for Canadians.
Next meeting is on 23 October 2024.
Next 24 Hours Bias
Medium Bullish
Oil
Key news events today
EIA Crude Oil Inventories (2:30 pm GMT)
What can we expect from Oil today?
News on a possible ceasefire between Hezbollah and Israel saw oil prices tumble 4.2% as WTI oil slid from $75.60 to an overnight low of $72.69 per barrel on Tuesday. This benchmark retraced off yesterday’s lows to climb above $74 per barrel as Asian markets came online. Tensions continue to remain elevated in the Middle East but this latest headline has somewhat eased the risk premium on crude oil. Combined with a large build in the API stockpiles, prices have come under pressure – 10.9M barrels of crude were added to inventories which was significantly higher than the forecast of 1.95M barrels. After drawing down more than anticipated in the second half of September, the EIA inventories experienced a surprise build of 3.9M barrels of crude last week. However, this week’s forecast points to another build of 1.9M barrels which would increase the overhead pressures on oil once more.
Next 24 Hours Bias
Weak BearishTuesday 8th October 2024: Asian Markets Lose Steam as Chinese Rally Fades
By IC Markets
Asian Markets Lose Steam as Chinese Rally Fades
Trade the Aussie Dollar on the US ADP Employment Data Release
By IC Markets
IC Markets Global • Oct 2, 2024
General Market Analysis
By IC Markets
General Market Analysis – 16/09/24
US Stocks Surge Higher Over the Weekend – Dow up 0.7%
US stock markets pushed higher again on Friday as expectations for a 50-basis-point cut from the Fed this week increased. The Dow rose 0.72%, the S&P 500 climbed 0.54%, and the tech-heavy Nasdaq jumped another 0.65%. The S&P is now just 1% off all-time highs heading into the crucial week ahead. US Treasury yields pulled back in line with these expectations, with the 2-year dropping 5.9 basis points to 3.580% and the benchmark 10-year falling 2.1 basis points to 3.659%. The dollar drifted lower, with the index now sitting near a 9-month low as the fresh week approaches. Oil prices fell in late trading as US output in the Gulf of Mexico resumed following Hurricane Francine, with Brent down 0.5% to $71.61 a barrel and WTI off 0.5% to $68.65 a barrel. Gold stood out again, powering to fresh record highs for the second day in a row, adding another 0.8% to close at $2,576 after hitting a high of $2,585.99.
Fed Rate Cut Expectations Surge
Futures markets are now pricing in a 47% chance of a larger cut from the FOMC this week, up significantly from the 28% chance priced in on Thursday. This move was supported by hawkish comments from former New York Fed President Bill Dudley on Friday, though not by recent data updates. Some investors are questioning the speed and size of market adjustments, as both headline CPI and PPI numbers came in slightly higher than expected this week. With US stock indices still powering ahead, and the S&P sitting just 1% off all-time highs, there is concern the market may have overreacted. If expectations remain near these levels heading into Wednesday’s Fed meeting, a 25-basis-point cut could lead to significant market corrections.
Calm Before the Market Storm
The macroeconomic calendar looks sparse tomorrow, ahead of what could be one of the most pivotal weeks in the trading year. Traders are expecting positive moves at the Asian open on Monday, following another strong day on Wall Street on Friday. Liquidity could be limited early in the day, as both China and Japan enjoy long weekends. While there is little of note on the calendar during the Asian and European sessions, traders are anticipating increased volatility due to the major updates scheduled for later in the week.
The New York open will see the release of the Empire State Manufacturing Index, with the market pricing in a 4.1 decrease. However, expect more volatility from any updates on Fed rate cut expectations.Monday 9th September 2024: Asia-Pacific Markets Fall on Weak U.S. Jobs Report, Slower China Inflatio
By IC Markets
Global Markets:
Asian Stock Markets : Nikkei down 0.72%, Shanghai Composite down 1.05%, Hang Seng down 2.05% ASX down 0.32%
Commodities : Gold at $2518.35 (0.29%), Silver at $28.3 (0.91%), Brent Oil at $71.90 (1.39%), WTI Oil at $68.6 (1.38%)
Rates : US 10-year yield at 3.740, UK 10-year yield at 3.967, Germany 10-year yield at 2.219
News & Data:
(CAD) Employment Change 22.1k vs 23.7K expected
(CAD) Unemployment Rate 6.6% vs 6.5% expected
(USD) Average Hourly Earnings m/m 0.4% vs 0.3% expected
(USD) Non-Farm Employment Change 142K vs 164K expected
(USD) Unemployment Rate 4.2% vs 4.2% expected
Markets Update:
Asia-Pacific markets declined on Monday, with Hong Kong’s Hang Seng Index leading the region’s losses. This followed a weaker-than-expected U.S. jobs report released on Friday.
China’s inflation rate grew 0.6% year-over-year, below the 0.7% predicted by economists polled by Reuters. On a month-to-month basis, China’s Consumer Price Index (CPI) rose 0.4%, also falling short of the 0.5% expectation. Hong Kong’s Hang Seng Index dropped by 2.08%, while mainland China’s CSI 300 decreased by 1.41%.
In corporate news, Chinese electrical appliance maker Midea Group announced plans to list 492.1 million shares in Hong Kong, priced between HK$52 and HK$54.80 per share. At the top of that range, the listing would be valued at HK$26.97 billion ($3.46 billion), making it the largest IPO in the city in over three years.
Japan’s second-quarter GDP grew by 2.9% on an annualized basis, below the 3.2% expected. This softer growth could limit the Bank of Japan’s ability to raise interest rates. The Nikkei 225 fell by 0.48%, and the Topix dropped 0.68%. The Japanese yen weakened 0.4% against the U.S. dollar. South Korea’s Kospi fell 0.33%, while Australia’s S&P/ASX 200 dipped 0.32%.
On Friday, U.S. nonfarm payrolls rose by 142,000, missing the estimated 161,000 gain, while the unemployment rate matched expectations at 4.2%. The S&P 500 and Nasdaq both recorded their worst weeks since March.
Upcoming Events:
2:00 PM GMT – USD Final Wholesale Inventories m/m
7:00 PM GMT – USD Consumer Credit m/mFriday 6th September 2024: Asia-Pacific Markets Decline Amid U.S. Jobs Report Anticipation
By IC Markets
Global Markets:
- Asian Stock Markets : Nikkei down 0.63%, Shanghai Composite down 0.55%, Hang Seng down 0.08% ASX up 0.4%
- Commodities : Gold at $2550.35 (0.39%), Silver at $29.2 (0.31%), Brent Oil at $72.90 (0.39%), WTI Oil at $69.3 (0.38%)
- Rates : US 10-year yield at 3.704, UK 10-year yield at 3.916, Germany 10-year yield at 2.2183
News & Data:
(CAD) Labor Productivity q/q -0.2% vs -0.1% expected
(USD) ADP Non-Farm Employment Change 99K vs 144K expected
(USD) Unemployment Claims 227K vs 231K expected
Markets Update:
Asia-Pacific markets largely declined on Friday as investors anticipated a key U.S. jobs report and absorbed Japan’s household spending data. Japan’s household spending for July grew by only 0.1% year-on-year, significantly below the 1.2% increase expected by economists. This was a turnaround from June’s 1.4% decline. According to Japan’s statistics bureau, average household spending for July 2024 was 290,931 yen ($2,031.35), a 3.3% rise in nominal terms. Meanwhile, household income surged to 694,483 yen, up 8.9% nominally and 5.5% in real terms.
The weaker spending data could limit the Bank of Japan’s ability to raise interest rates, though strong wage growth figures from Thursday might provide some balance. Japan’s Nikkei 225 fell by 0.6%, while the Topix dropped by 0.97%. Seven & i Holdings, the parent company of 7-Eleven, lost 1.73% after rejecting a takeover offer from Alimentation Couche-Tard.
South Korea’s Kospi was down 0.87%, and the Kosdaq dropped 2.31%. Conversely, Australia’s S&P/ASX 200 rose by 0.4%.
In Hong Kong, markets remained closed due to Super Typhoon Yagi. The Hong Kong Observatory expected to lower the storm signal by 12:40 p.m., though trading would stay halted for the day if downgraded after noon.
Mainland China’s CSI 300 slipped 0.27%. In the U.S., all major indexes dropped, with the S&P 500 losing 0.3% and the Dow Jones falling 0.54%. However, the Nasdaq Composite gained 0.25%.
Upcoming Events:
12:30 PM GMT – CAD Employment Change
12:30 PM GMT – CAD Unemployment Rate
12:30 PM GMT – USD Average Hourly Earnings m/m
12:30 PM GMT – USD Non-Farm Employment Change
12:30 PM GMT – USD Unemployment RateIC Markets Europe Fundamental Forecast | 5 September 2024
By IC Markets
What happened in the Asia session?
During her speech at the Anika Foundation in Sydney this morning, Reserve Bank of Australia (RBA) Governor Michele Bullock reiterated that it was premature to contemplate interest rate cuts in the near future as inflation remained too high – headline CPI sits well above the RBA’s inflation target band of 2 to 3% on both a monthly and quarterly basis. Governor Bullock continues to maintain a hawkish stance even as recent data showed the economy struggling over the last few quarters. Despite Governor Bullock’s hawkish rhetoric, the Aussie failed to climb higher as it fizzled out around 0.6730 by Asia midday but with the U.S. dollar facing strong headwinds, the Aussie could once again resume its recent uptrend in the latter half of today.
What does it mean for the Europe & US sessions?
Factory orders in Germany rebounded strongly in June rising 3.9% MoM to buck the five-month downtrend. However, July’s estimate points to a decline of 1.6% highlighting the ongoing weakness for this sector. Should we see orders decline more than anticipated. it could create headwinds for the Euro before the start of the European session.
Construction activity has rebounded strongly in 2024 with the Construction PMI returning to expansion in March. July saw a strong jump with a reading of 55.3 as the housing, commercial and civil engineering sectors all saw solid increases. The estimate of 54.6 for August points to a sixth consecutive month of expansion and could serve as a potential bullish catalyst for the Pound.
The Dollar Index (DXY)
Key news events today
ADP Employment Report (12:15 pm GMT)
Unemployment Claims (12:30 pm GMT)
ISM Services PMI (2:00 pm GMT)
What can we expect from DXY today?
Job creation has slowed significantly since May as reported by the ADP report with July’s reading of 122K coming in much lower than the 12-month average of 147K. The estimate of 143K for the month of August points to a slight uptick in employment growth but should the result miss market expectations once again, the dollar sell-off could resume later today.
Unemployment claims have trended lower over the past four weeks to signal resilience in the labour market following an increase from mid-May to end-July. The latest forecast of 231K points to an unchanged figure from last week and it appears that claims have stabilized for now.
Finally, the ISM Services PMI report for the month of August is anticipated to expand for the second month in a row with a reading of 51.3, a somewhat unchanged figure from 51.4 in July. The services sector continues to pull up overall PMI activity in the U.S. but should the latest result fall short of market expectations, it could function as an additional bearish catalyst for the greenback.
Central Bank Notes:
The Federal Funds Rate target range remained unchanged at 5.25% to 5.50% for the eighth meeting in a row.
The Committee seeks to achieve maximum employment and inflation at the rate of 2% over the longer run and judges that the risks to achieving its employment and inflation goals continue to move into better balance.
The economic outlook is uncertain, and the Committee is attentive to the risks to both sides of its dual mandate.
Recent indicators suggest that economic activity has continued to expand at a solid pace while job gains have moderated, and the unemployment rate has moved up but remains low.
In considering any adjustments to the target range for the federal funds rate, the Committee will carefully assess incoming data, the evolving outlook, and the balance of risks and does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2%.
In assessing the appropriate stance of monetary policy, the Committee will continue to monitor the implications of incoming information for the economic outlook and would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.
In addition, the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage-backed securities. Beginning in June, the Committee slowed the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $60 billion to $25 billion.
The Committee will maintain the monthly redemption cap on agency debt and agency mortgage-backed securities at $35 billion and will reinvest any principal payments in excess of this cap into Treasury securities.
Next meeting runs from 17 to 18 September 2024.
Next 24 Hours Bias
Medium Bearish
Gold (XAU)
Key news events today
ADP Employment Report (12:15 pm GMT)
Unemployment Claims (12:30 pm GMT)
ISM Services PMI (2:00 pm GMT)
What can we expect from Gold today?
Job creation has slowed significantly since May as reported by the ADP report with July’s reading of 122K coming in much lower than the 12-month average of 147K. The estimate of 143K for the month of August points to a slight uptick in employment growth but should the result miss market expectations once again, the dollar sell-off could resume later today.
Unemployment claims have trended lower over the past four weeks to signal resilience in the labour market following an increase from mid-May to end-July. The latest forecast of 231K points to an unchanged figure from last week and it appears that claims have stabilized for now.
Finally, the ISM Services PMI report for the month of August is anticipated to expand for the second month in a row with a reading of 51.3, a somewhat unchanged figure from 51.4 in July. The services sector continues to pull up overall PMI activity in the U.S. but should the latest result fall short of market expectations, it could function as an additional bearish catalyst for the greenback. Whatever the outcome, it is bound to be a volatile period for gold.
Next 24 Hours Bias
Medium Bullish
The Australian Dollar (AUD)
Key news events today
RBA Gov Bullock Speaks (2:00 am GMT)
What can we expect from AUD today?
During her speech at the Anika Foundation in Sydney this morning, Reserve Bank of Australia (RBA) Governor Michele Bullock reiterated that it was premature to contemplate interest rate cuts in the near future as inflation remained too high – headline CPI sits well above the RBA’s inflation target band of 2 to 3% on both a monthly and quarterly basis. Governor Bullock continues to maintain a hawkish stance even as recent data showed the economy struggling over the last few quarters. Despite Governor Bullock’s hawkish rhetoric, the Aussie failed to climb higher as it fizzled out around 0.6730 by Asia midday but with the U.S. dollar facing strong headwinds, the Aussie could once again resume its recent uptrend in the latter half of today.
Central Bank Notes:
The RBA kept the cash rate target unchanged at 4.35% on 6th August, marking the sixth consecutive pause.
Inflation has fallen substantially since its peak in 2022, as higher interest rates have been working to bring aggregate demand and supply closer towards balance but it still remains above the midpoint of the 2 to 3% target range.
The CPI rose by 3.9% over the year to the June quarter, demonstrating that inflation is proving persistent. In year-ended terms, underlying inflation has now been above the midpoint of the target for 11 consecutive quarters while quarterly underlying CPI inflation has fallen very little over the past year.
The central forecasts set out in the latest SMP are for inflation to return to the target range of 2 to 3% in late 2025 and approach the midpoint in 2026. This represents a slightly slower return to target than forecast in May, based on estimates that the gap between aggregate demand and supply in the economy is larger than previously thought.
Momentum in economic activity has been weak, as evidenced by slow growth in GDP, a rise in the unemployment rate and reports that many businesses are under pressure. In addition, there is a risk that household consumption picks up more slowly than expected, resulting in continued subdued output growth and a noticeable deterioration in the labour market.
Inflation in underlying terms remains too high, and the latest projections show that it will be some time yet before inflation is sustainably in the target range while recent data have reinforced the need to remain vigilant to upside risks to inflation and the Board is not ruling anything in or out.
Policy will need to be sufficiently restrictive until the Board is confident that inflation is moving sustainably towards the target range and will rely upon the incoming data and the evolving assessment of risks to guide its decisions.
Next meeting is on 5 November 2024.
Next 24 Hours Bias
Medium Bullish
The Kiwi Dollar (NZD)
Key news events today
No major news events.
What can we expect from NZD today?
Demand for the dollar waned overnight pushing the Kiwi above the 0.6200-threshold but the move was not sustained. This currency pair pulled back towards 0.6180 but it began to rise strongly upwards at the beginning of the Asia session – these are the support and resistance levels for today.
Support: 0.6125
Resistance: 0.6250
Central Bank Notes:
The Monetary Policy Committee agreed to reduce the OCR by 25 basis points, bringing it down to 5.25% in August as inflation converges on target.
The Committee is confident that inflation is returning to within its 1-3% target band as surveyed inflation expectations, firms’ pricing behaviour, headline inflation, and a variety of core inflation measures are moving consistent with low and stable inflation.
Economic growth remains below trend and inflation is declining across advanced economies – imported inflation into New Zealand has declined to be more consistent with pre-pandemic levels.
Services inflation remains elevated but is also expected to continue to decline, both at home and abroad, in line with increased spare economic capacity.
Consumer price inflation in New Zealand is expected to remain near the target mid-point over the foreseeable future.
A broad range of high-frequency indicators point to a material weakening in domestic economic activity in recent months – these include various survey measures of business activity, electronic card transactions, vehicle traffic, house sales, filled jobs, and job vacancies; these indicators collectively provide a consistent signal that the economy contracted in recent months.
The pace of further easing will depend on the Committee’s confidence that pricing behaviour remains consistent with a low inflation environment, and that inflation expectations are anchored around the 2% target.
Next meeting is on 9 October 2024.
Next 24 Hours Bias
Medium Bullish
The Japanese Yen (JPY)
Key news events today
No major news events.
What can we expect from JPY today?
Comments made by Bank of Japan (BoJ) Governor Kazuo Ueda on Tuesday continue to reverberate in markets as demand for the yen remained strong on Wednesday driving USD/JPY under 144. This currency pair tumbled as low 143.18 overnight before stabilizing to retrace higher towards 143.90 as Asian markets came online – these are the support and resistance levels for today.
Support: 143.50
Resistance: 145.50
Central Bank Notes:
The Policy Board of the Bank of Japan decided, by a 7-2 majority vote, to set the following guideline for money market operations for the intermeeting period and decided on the following measures:
The Bank will encourage the uncollateralized overnight call rate to remain at around 0.25% while reducing its purchase amount of Japanese government bonds (JGB) by a unanimous vote.
The Bank decided, by a unanimous vote, on a plan to reduce the amount of its monthly outright purchases of JGBs so that it will be about 3 trillion yen in January-March 2026; the amount will be cut down by about 400 billion yen each calendar quarter in principle.
The year-on-year rate of increase in the CPI (all items less fresh food) is likely to be at around 2.5% for fiscal 2024 and then be at around 2% for fiscal 2025 and 2026.
Meanwhile, underlying CPI inflation is expected to increase gradually, since it is projected that the output gap will improve and that medium- to long-term inflation expectations will rise with a virtuous cycle between wages and prices continuing to intensify.
In the second half of the projection period, it is likely to be at a level that is generally consistent with the price stability target of 2%.
Japan’s economy is likely to keep growing at a pace above its potential growth rate, with overseas economies continuing to grow moderately and as a virtuous cycle from income to spending gradually intensifies against the background of factors such as accommodative financial conditions.
Next meeting is on 20 September 2024.
Next 24 Hours Bias
Medium Bearish
The Euro (EUR)
Key news events today
Germany Factory Orders (6:00 am GMT)
What can we expect from EUR today?
Factory orders in Germany rebounded strongly in June rising 3.9% MoM to buck the five-month downtrend. However, July’s estimate points to a decline of 1.6% highlighting the ongoing weakness for this sector. Should we see orders decline more than anticipated. it could create headwinds for the Euro before the start of the European session.
Central Bank Notes:
The Governing Council today decided to keep the three key ECB interest rates unchanged in July, following a 25 basis points cut in June.
Accordingly, the interest rate on the main refinancing operations and the interest rates on the marginal lending facility and the deposit facility will remain unchanged at 4.25%, 4.50% and 3.75% respectively.
Monetary policy is keeping financing conditions restrictive but at the same time, domestic price pressures are still high, services inflation is elevated and headline inflation is likely to remain above the target well into next year.
While some measures of underlying inflation ticked up in May owing to one-off factors, most measures were either stable or edged down in June.
The incoming information indicates that the euro area economy grew in the second quarter, but likely at a slower pace than in the first quarter.
Services continue to lead the recovery, while industrial production and goods exports have been weak – investment indicators point to muted growth in 2024, amid heightened uncertainty.
The Eurosystem no longer reinvests all of the principal payments from maturing securities purchased under the pandemic emergency purchase programme (PEPP), reducing the PEPP portfolio by €7.5 billion per month on average and the Governing Council intends to discontinue reinvestments under the PEPP at the end of 2024.
The Council is determined to ensure that inflation returns to its 2% medium-term target in a timely manner and will keep policy rates sufficiently restrictive for as long as necessary to achieve this aim and is not pre-committing to a particular rate path.
Next meeting is on 12 September 2024.
Next 24 Hours Bias
Medium Bullish
The Swiss Franc (CHF)
Key news events today
No major news events.
What can we expect from CHF today?
Softer JOLTS data from the U.S. created headwinds for USD/CHF as it fell under 0.8500 overnight. This currency pair fell as low as 0.8455 but was retracing higher as Asian markets came online – these are the support and resistance levels for today.
Support: 0.8400
Resistance: 0.8560
Central Bank Notes:
The SNB eased monetary policy by lowering its key policy rate by 25 basis points for the second consecutive meeting, going from 1.50% to 1.25% in June.
The underlying inflationary pressure has decreased again compared to the previous quarter but inflation had risen slightly since the last monetary policy assessment, and stood at 1.4% in May.
The inflation forecast puts average annual inflation at 1.3% for 2024, 1.1% for 2025 and 1.0% for 2026, based on the assumption that the SNB policy rate is 1.25% over the entire forecast horizon.
Swiss GDP growth was moderate in the first quarter of 2024 with the services sector continuing to expand, while manufacturing stagnated.
Growth is likely to remain moderate in Switzerland in the coming quarters as the SNB anticipates GDP growth of around 1% this year while currently expecting growth of around 1.5% for 2025.
Next meeting is on 26 September 2024.
Next 24 Hours Bias
Weak Bearish
The Pound (GBP)
Key news events today
Construction PMI (8:30 am GMT)
What can we expect from GBP today?
Construction activity has rebounded strongly in 2024 with the Construction PMI returning to expansion in March. July saw a strong jump with a reading of 55.3 as the housing, commercial and civil engineering sectors all saw solid increases. The estimate of 54.6 for August points to a sixth consecutive month of expansion and could serve as a potential bullish catalyst for the Pound.
Central Bank Notes:
The Bank of England’s Monetary Policy Committee (MPC) voted by a majority of 5-to-4 to reduce its Official Bank Rate by 25 basis points to 5.00% on 1st August 2024.
Five members preferred to reduce the Bank Rate by 25 basis points to 5%, an increase of two from the previous meeting while four members preferred to maintain the Bank Rate at 5.25%.
Twelve-month CPI inflation was at the MPC’s 2% target in both May and June but it is expected to increase to around 2.75% in the second half of this year as declines in energy prices last year fall out of the annual comparison, revealing more clearly the prevailing persistence of domestic inflationary pressures. Private sector regular average weekly earnings growth has fallen to 5.6% in the three months to May, and services consumer price inflation has declined to 5.7% in June.
GDP has picked up quite sharply so far this year, but underlying momentum appears weaker. GDP had grown by 0.7% in 2024 Q1, with that strength appearing to have continued into Q2. Growth in the first half of the year had been stronger than expected at the time of the May Report.
Business surveys had continued to point to underlying growth of around 0.3% per quarter, somewhat weaker than headline GDP growth. A margin of slack should emerge in the economy as GDP falls below potential and the labour market eases further.
The Committee noted that it is now appropriate to reduce slightly the degree of policy restrictiveness but monetary policy will need to continue to remain restrictive for sufficiently long until the risks to inflation returning sustainably to the 2% target in the medium term have dissipated further.
The Committee continues to monitor closely the risks of inflation persistence and will decide the appropriate degree of monetary policy restrictiveness at each meeting.
Next meeting is on 19 September 2024.
Next 24 Hours Bias
Medium Bullish
The Canadian Dollar (CAD)
Key news events today
No major news events.
What can we expect from CAD today?
As widely expected, the Bank of Canada (BoC) moved ahead with its third consecutive 25 basis points cut on Wednesday to reduce the overnight rate from 4.5% down to 4.25%. This central bank noted that the extension of its cutting cycle was warranted as excess supply in the Canadian economy continued to put downward pressure on inflation while reiterating concerns about undershooting inflation targets, adding to their worries of potential overtightening. Policymakers recognised that the labour market continued to slow in recent months but wage growth remained elevated. In addition, they remain cognizant that inflation is elevated for the shelter and selected services categories and that upside risks to price growth are present. Despite the rate cut, the Loonie strengthened causing USD/CAD to reverse from 1.3550 and tumble as low as 1.3500 following the interest rate decision – this move could be attributed to the weaker-than-expected JOLTS data out of the U.S. which triggered a sharp sell-off in the greenback.
Central Bank Notes:
The Bank of Canada reduced its target for the overnight rate by 25 basis points for the third consecutive meeting to 4.25% while continuing its policy of balance sheet normalization on 4th September.
Canada’s economy grew 2.1% in the second quarter of 2024, led by government spending and business investment.
This second quarter GDP growth was slightly stronger than forecast in July, but preliminary indicators suggest that economic activity was soft through June and July.
As expected, inflation slowed further to 2.5% in July. The Bank’s preferred measures of core inflation averaged around 2.5% and the share of components of the consumer price index growing above 3% is roughly at its historical norm.
High shelter price inflation is still the biggest contributor to total inflation but is starting to slow while inflation also remains elevated in some other services.
The labour market continues to slow, with little change in employment in recent months. Wage growth, however, remains elevated relative to productivity.
The Governing Council is carefully assessing these opposing forces on inflation and monetary policy decisions will be guided by incoming information and our assessment of their implications for the inflation outlook.
The Bank remains resolute in its commitment to restoring price stability for Canadians.
Next meeting is on 23 October 2024.
Next 24 Hours Bias
Weak Bearish
Oil
Key news events today
EIA Crude Oil Inventories (3:00 pm GMT)
What can we expect from Oil today?
Oil prices stabilized overnight as traders weigh a potential delay to the increase in production levels by OPEC+ which is scheduled to start in October. Demand concerns remain as China’s factory activity contracted for a fourth consecutive month while export disruptions in Libya continue to inject higher volatility for prices.
Moving over the U.S. inventory levels, the API stockpiles saw a large drawdown of 7.4M barrels of crude to mark the highest decline in almost nine weeks which also helped to support prices – WTI oil stabilized around $69.30 per barrel overnight before retracing higher towards the $70-mark as Asian markets came online.
Next 24 Hours Bias
Medium BearishIC Markets Europe Fundamental Forecast | 3 September 2024
By IC Markets
IC Markets Europe Fundamental Forecast | 3 September 2024
Tuesday 3rd September 2024: Asia-Pacific Markets Dip as Investors Digest South Korea’s Inflation Dat
By IC Markets
Global Markets:
- Asian Stock Markets : Nikkei down 0.15%, Shanghai Composite down 0.47%, Hang Seng down 0.54% ASX up 0.16%
- Commodities : Gold at $2524.35 (-0.29%), Silver at $28.75 (-0.71%), Brent Oil at $77.30 (-0.29%), WTI Oil at $74.12 (-0.18%)
- Rates : US 10-year yield at 3.917, UK 10-year yield at 4.055, Germany 10-year yield at 2.3325
News & Data:
- (GBP) BRC Retail Sales Monitor y/y 0.8% vs 0.3% expected
Markets Update:
Asia-Pacific markets mostly declined on Tuesday as investors evaluated South Korea’s inflation data for August, which showed the lowest year-on-year increase since March 2021. The country’s consumer price index (CPI) rose by 2% compared to the previous year, down from July’s 2.6% and matching the expectations of a Reuters poll of economists. On a month-on-month basis, the CPI increased by 0.4%, slightly above the 0.3% forecasted.
In Japan, the Nikkei 225 dipped by 0.15% in afternoon trading, while the Topix index rose by 0.42%. South Korea’s Kospi index fell by 0.34%, and the smaller Kosdaq index dropped by 0.66%. Australia’s S&P/ASX 200 also edged down by 0.16%.
Mainland China’s CSI 300 saw a slight gain as it attempted to recover from a seven-month low reached on Monday, while Hong Kong’s Hang Seng index declined by 0.37%.
Meanwhile, U.S. markets were closed on Monday due to the Labor Day holiday. However, futures tied to the major U.S. indexes were down ahead of Tuesday’s session. The Dow Jones Industrial Average futures slipped by 57 points, or 0.14%, while S&P 500 futures decreased by 0.12%, and Nasdaq-100 futures fell by 0.26%.
Upcoming Events:
- 2:00 PM GMT – USD ISM Manufacturing PMI
- 2:00 PM GMT – USD ISM Manufacturing Prices
- 2:00 PM GMT – USD Construction Spending m/mThursday 1st August 2024: Asia-Pacific Markets Mixed Amid Fed and Regional Data
By IC Markets
IC Markets Global • Aug 1, 2024
Tuesday 23rd April 2024: Technical Outlook and Review
By IC Markets
EUR/USD:
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Price could potentially make a bearish reaction off pivot and drop to the 1st support.
PIvot: 1.0699
Supporting reasons: Pullback resistance at the 38.20% Fibonacci Retracement level, indicating a significant level where selling pressure might intensify, potentially leading to a reversal or continuation of the bearish momentum.
1st support: 1.0615
Supporting reasons: Multi-swing low support, suggesting a level where buyers have previously intervened to support the price, potentially acting as a foundation for a bounce or temporary halt in the bearish momentum.
1st resistance: 1.0680
Supporting reasons: Pullback resistance, representing a level where selling pressure might increase, potentially acting as a barrier to further upward movement.
EUR/JPY:
Potential Direction: Neutral
Overall momentum of the chart: Neutral
Price could potentially make a fluctuation between the 1st resistance and 1st support level.
1st support: 162.64
Supporting reasons: Multi-swing low support, indicating a level where buyers have previously intervened to support the price, potentially acting as a foundation for a bounce or temporary halt in the momentum.
1st resistance: 154.15
Supporting reasons: Multi-swing high resistance, representing a level where selling pressure might increase, potentially acting as a barrier to further upward movement.
EUR/GBP:
Potential Direction: Bullish
Overall momentum of the chart: Bullish
Price could potentially make a bullish bounce off the pivot and head towards the 1st resistance.
PIvot: 0.8603
Supporting reasons: Pullback support, indicating a level where buyers might step in to support the price, potentially providing a foundation for a bounce.
1st support: 0.8582
Supporting reasons: Pullback support, suggesting a level where buyers have previously intervened to support the price.
1st resistance: 0.8650
Supporting reasons: Pullback resistance, representing a level where selling pressure might intensify, potentially acting as a barrier to further upward movement.
GBP/USD:
Potential Direction: Bullish
Overall momentum of the chart: Bearish
Price could potentially make a bullish bounce off the pivot and head towards the 1st resistance.
PIvot: 1.2319
Supporting reasons: An Overlap support, indicating a significant level where buyers might step in to support the price.
1st support: 1.2198
Supporting reasons: An Overlap support, suggesting a level where buyers have previously intervened to support the price.
1st resistance: 1.2429
Supporting reasons: Pullback resistance, representing a level where selling pressure might intensify, potentially acting as a barrier to further upward movement.
GBP/JPY:
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Price could potentially make a bearish continuation towards the 1st support.
PIvot: 191.74
Supporting reasons: An Overlap resistance, indicating a significant level where selling pressure might increase.
1st support: 190.30
Supporting reasons: Multi-swing low support, suggesting a level where buyers have previously intervened to support the price.
1st resistance: 192.79
Supporting reasons: Multi-swing high resistance, representing a level where selling pressure might intensify, potentially acting as a barrier to further upward movement.
USD/CHF:
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Price could potentially make a bearish reaction off pivot and drop to 1st support.
PIvot: 0.9145
Supporting reasons: Multi-swing high resistance, indicating a level where selling pressure might intensify, potentially leading to a reversal or continuation of the bearish momentum.
1st support: 0.9057
Supporting reasons: An Overlap support, suggesting a level where buyers might step in to support the price, potentially providing a foundation for a bounce or temporary halt in the bearish momentum.
1st resistance: 0.9191
Supporting reasons: 127.20% Fibonacci Extension, representing a level where selling pressure might increase, potentially acting as a barrier to further downside movement.
USD/JPY:
Potential Direction: Bearish
Overall momentum of the chart: Bullish
Price could potentially make a bearish reaction off pivot and drop to 1st support.
PIvot: 154.77
Supporting reasons: Multi-swing high resistance, indicating a level where selling pressure might intensify, potentially leading to a reversal or continuation of the bullish momentum.
1st support: 153.36
Supporting reasons: Pullback support, suggesting a level where buyers might step in to support the price, potentially providing a foundation for a bounce or temporary halt in the bullish momentum.
1st resistance: 155.46
Supporting reasons: 161.80% Fibonacci Extension, representing a level where selling pressure might increase, potentially acting as a barrier to further upside movement. Additionally, RSI is also displaying bearish divergence versus price, suggesting that a reversal might occur soon.
USD/CAD:
Potential Direction: Bullish
Overall momentum of the chart: Bearish
Price could fall towards the pivot and potentially make a bullish bounce off this level to rise towards the 1st resistance
Pivot: 1.3668
Supporting reasons: Acts as a pullback support that aligns with a 61.8% Fibonacci retracement level, suggesting a significant area where price could find a solid foundation for potential price stabilization or a rebound.
1st support: 1.3628
Supporting reasons: Identified as a pullback support that aligns close to a 61.8% Fibonacci retracement level, suggesting an area where price has previously found strong buying interest to potentially halt any further downward movement.
1st resistance: 1.3741
Supporting reasons: Identified as an overlap resistance that aligns with a 38.2% Fibonacci retracement level, marking a significant barrier that could cap further upward movements.
AUD/USD:
Potential Direction: Bearish
Overall momentum of the chart: Neutral
Price could rise towards the pivot and potentially make a bearish reaction off this level to drop towards the 1st support
Pivot: 0.6486
Supporting reasons: Acts as a pullback resistance, suggesting a significant area where price has previously faced strong selling pressures and could stall around this level before reversing to drop lower.
1st support: 0.6397
Supporting reasons: Acts as a pullback support, suggesting a significant area where price has previously found strong support and could provide a basis to halt further downward movement.
1st resistance: 0.6545
Supporting reasons: Identified as a pullback resistance that aligns close to a 61.8% Fibonacci retracement level, marking a barrier that has previously capped upward movements.
NZD/USD:
Potential Direction: Bearish
Overall momentum of the chart: Neutral
Price could rise towards the pivot and potentially make a bearish reaction off this level to drop towards the 1st support
Pivot: 0.5930
Supporting reasons: Acts as a pullback resistance that aligns close to a 38.2% Fibonacci retracement level, suggesting a significant area where price has previously faced strong selling pressures and could stall around this level before reversing to drop lower.
1st support: 0.5873
Supporting reasons: Acts as a pullback support, suggesting a potential area for price stabilization or a minor rebound within the bearish context.
1st resistance: 0.5974
Supporting reasons: Identified as a pullback resistance that aligns close to a 50% Fibonacci retracement level, marking a barrier that has previously capped upward movements.
US30 (DJIA):
Potential Direction: Bearish
Overall momentum of the chart: Neutral
Price could rise towards the pivot and potentially make a bearish reaction off this level to drop towards the 1st support
Pivot: 38,546.69
Supporting reasons: Acts as an overlap resistance that aligns with a 50% Fibonacci retracement level, suggesting a significant area where price has previously faced strong selling pressures and could stall around this level before reversing to drop lower.
1st support: 38,025.73
Supporting reasons: Identified as an overlap support that aligns with a 38.2% Fibonacci retracement level, suggesting a significant area where price has previously found strong buying interest and could provide a solid foundation to halt further downward movement.
1st resistance: 39,042.57
Supporting reasons: Identified as an overlap resistance that aligns with a 61.8% Fibonacci retracement level, indicating a potential barrier that could cap any upward movements.
DE40 (DAX):
Potential Direction: Bearish
Overall momentum of the chart: Neutral
Price could rise towards the pivot and potentially make a bearish reaction off this level to drop towards the 1st support
Pivot: 18,152.00
Supporting reasons: Acts as a pullback support that aligns with a 61.8% Fibonacci retracement level, suggesting a significant area where price has previously faced strong selling pressures and could stall around this level before reversing to drop lower.
1st support: 17,712.10
Supporting reasons: Acts as a pullback support, suggesting a significant area where price has previously found strong buying interest and could provide a solid foundation to halt further downward movement.
1st resistance: 18,315.80
Supporting reasons: Identified as a pullback resistance that aligns with a 78.6% Fibonacci retracement level, potentially functioning as a barrier that could cap any upward movements.
US500 (S&P 500):
Potential Direction: Bearish
Overall momentum of the chart: Neutral
Price could rise towards the pivot and potentially make a bearish reaction off this level to drop towards the 1st support
Pivot: 5,069.96
Supporting reasons: Acts as a pullback support that aligns close to a 38.2% Fibonacci retracement level, suggesting a significant area where price has previously faced strong selling pressures and could stall around this level before reversing to drop lower.
1st support: 4,963.35
Supporting reasons: Acts as a pullback support, suggesting a significant area where price has previously found strong buying interest and could provide a solid foundation to halt further downward movement.
1st resistance: 5,117.20
Supporting reasons: Marked by a pullback resistance that aligns close to a 50% Fibonacci retracement level, which could function as a potential barrier and cap any upward movements.
BTC/USD (Bitcoin):
Potential Direction: Bearish
Overall momentum of the chart: Neutral
Price could rise towards the pivot and potentially make a bearish reaction off this level to drop towards the 1st support
Pivot: 67,959.86
Supporting reasons: Acts as a pullback support that aligns with a 61.8% Fibonacci retracement level, suggesting a significant area where price could face strong selling pressures and potentially stall around this level before reversing to drop lower.
1st support: 64,549.56
Supporting reasons: Acts as an overlap support, suggesting a significant area where price has previously found support and could provide a strong foundation to halt further downward movements.
1st resistance: 71,123.59
Supporting reasons: Marked by a pullback resistance, indicating a significant barrier that could cap further upward movements.
ETH/USD (Ethereum):
Potential Direction: Bearish
Overall momentum of the chart: Neutral
Price could rise towards the pivot and potentially make a bearish reaction off this level to drop towards the 1st support
Pivot: 3,256.52
Supporting reasons: Acts as a pullback support that aligns close to a 50% Fibonacci retracement level, suggesting a significant area where price could face strong selling pressures and potentially stall around this level before reversing to drop lower.
1st support: 2,945.02
Supporting reasons: Identified as a pullback support, suggesting a significant area where price has previously found support and could provide a strong foundation to halt further downward movements.
1st resistance: 3,436.46
Supporting reasons: Identified as an overlap resistance that aligns close to a 61.8% Fibonacci retracement level, marking a significant barrier that could cap further upward movements.
WTI/USD (Oil):
Potential Direction: Bullish
Overall momentum of the chart: Neutral
Price has made a bullish reaction off the pivot and could potentially rise towards the 1st resistance
Pivot: 81.86
Supporting reasons: Acts as a pullback support, suggesting a significant area where price has previously found support to provide a strong foundation for a potential rebound.
1st support: 80.62
Supporting reasons: Identified as a pullback support that aligns close to a 61.8% Fibonacci retracement level, suggesting a significant area where price has previously found strong buying interest and could provide a solid foundation to halt further downward movements.
1st resistance: 85.42
Supporting reasons: Identified as a pullback resistance that aligns with a 61.8% Fibonacci retracement level, marking a significant barrier that could cap further upward movements.
XAU/USD (GOLD):
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Price could potentially make a bearish reaction off pivot and drop to 1st support.
PIvot: 2320.00
Supporting reasons: Pullback support, indicating a level where buyers might intervene to support the price, potentially providing a foundation for a bounce or temporary halt in the bearish momentum.
1st support: 2266.00
Supporting reasons: An Overlap support, suggesting a significant level where buyers have previously stepped in to support the price, potentially acting as a strong support zone.
1st resistance: 2363.00
Supporting reasons: Pullback resistance, representing a level where selling pressure might intensify, potentially acting as a barrier to further upward movement within the context of the overall bearish trend.
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By IC Markets
EUR/USD:
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Factors contributing to the momentum is that price is: Below the bearish Ichimoku cloud
Price could potentially make a: Bearish break off pivot and drop towards 1st support
Pivot: 1.0610
Supporting reasons: Pullback resistance, indicating a significant level where selling pressure might intensify, potentially leading to a reversal or temporary halt in the bearish momentum.
1st support: 1.0550
Supporting reasons: 161.80% Fibonacci Extension, representing a level where buyers might step in to support the price, potentially providing a foundation for a bounce or temporary halt in the bearish momentum.
1st resistance: 1.0689
Supporting reasons: Swing high resistance, representing a level where selling pressure might increase, potentially acting as a barrier to further upside movement within the context of the overall bearish trend.
EUR/JPY:
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Price could potentially make a: Bearish break off pivot and drop towards 1st support
PIvot: 163.57
Supporting reasons: Pullback resistance, indicating a significant level where selling pressure might intensify, potentially leading to a reversal or temporary halt in the bearish momentum.
1st support: 162.53
Supporting reasons: An Overlap support, suggesting a level where buyers might step in to support the price, potentially providing a foundation for a bounce or temporary halt in the bearish momentum.
1st resistance: 165.14
Supporting reasons: Swing high resistance, representing a level where selling pressure might increase, potentially acting as a barrier to further upside movement within the context of the overall bearish trend.
EUR/GBP:
Potential Direction: Bullish
Overall momentum of the chart: Bullish
Price could potentially make a: Bullish continuation towards 1st resistance
Pivot: 0.8549
Supporting reasons: An Overlap support combined with a 38.20% Fibonacci Retracement, indicating a significant level where buying interest might be present, potentially providing a foundation for further upside movement.
1st support: 0.8531
Supporting reasons: Multi-swing low support, suggesting a level where buyers might step in to support the price, potentially providing a foundation for a bounce or temporary halt in the bullish momentum.
1st resistance: 0.8582
Supporting reasons: Multi-swing high resistance, representing a level where selling pressure might increase, potentially acting as a barrier to further upside movement within the context of the overall bullish trend.
GBP/USD:
Instrument: GBP/USD
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Price could potentially make a: Bearish break off pivot and drop towards 1st support
Pivot: 1.2424
Supporting reasons: Pullback resistance, indicating a significant level where selling pressure might intensify, potentially leading to a reversal or temporary halt in the bearish momentum.
1st support: 1.2338
Supporting reasons: Multi-swing low support combined with a 161.80% Fibonacci Extension, suggesting a level where buyers might step in to support the price, potentially providing a foundation for a bounce or temporary halt in the bearish momentum.
1st resistance: 1.2484
Supporting reasons: Multi-swing high resistance, representing a level where selling pressure might increase, potentially acting as a barrier to further upside movement within the context of the overall bearish trend.
GBP/JPY:
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Price could potentially make a: Bearish break off pivot and drop towards 1st support
Pivot: 191.58
Supporting reasons: Pullback resistance, indicating a significant level where selling pressure might intensify, potentially leading to a reversal or temporary halt in the bearish momentum.
1st support: 190.08
Supporting reasons: An Overlap support, suggesting a level where buyers might step in to support the price, potentially providing a foundation for a bounce or temporary halt in the bearish momentum.
1st resistance: 192.79
Supporting reasons: Multi-swing high resistance, representing a level where selling pressure might increase, potentially acting as a barrier to further upside movement within the context of the overall bearish trend.
USD/CHF:
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Price could potentially make a: Bearish break off pivot and drop towards 1st support
Pivot: 0.9089
Supporting reasons: Pullback resistance, indicating a significant level where selling pressure might intensify, potentially leading to a reversal or temporary halt in the bearish momentum.
1st support: 0.9024
Supporting reasons: An Overlap support, suggesting a level where buyers might step in to support the price, potentially providing a foundation for a bounce or temporary halt in the bearish momentum.
1st resistance: 0.9148
Supporting reasons: Multi-swing high resistance, representing a level where selling pressure might increase, potentially acting as a barrier to further upside movement within the context of the overall bearish trend.
USD/JPY:
Potential Direction: Bearish
Overall momentum of the chart: Bullish
Price could potentially make a: Bearish continuation towards 1st support
Pivot: 154.81
Supporting reasons: Multi-swing high resistance, indicating a level where selling pressure might intensify, potentially leading to a reversal or temporary halt in the bullish momentum, supported by the 78.60% Fibonacci Projection.
1st support: 151.93
Supporting reasons: Pullback support, suggesting a level where buyers might step in to support the price, potentially providing a foundation for a bounce or temporary halt in the bearish momentum.
1st resistance: 157.04
Supporting reasons: 100% Fibonacci Projection, representing a level where selling pressure might increase, potentially acting as a barrier to further upside movement within the context of the overall bullish trend.
USD/CAD:
Potential Direction: Bearish
Overall momentum of the chart: Bullish
Price could rise towards the pivot and potentially make a bearish reaction off this level to drop towards the 1st support
Pivot: 1.3828
Supporting reasons: Acts as a pullback resistance that aligns close to a 78.6% Fibonacci projection level, suggesting an area where price could potentially stall and pull back before resuming the uptrend.
1st support: 1.3753
Supporting reasons: Identified as a pullback support, suggesting an area where price could find strong buying interest to provide a foundation for potential price stabilization.
1st resistance: 1.3888
Supporting reasons: Identified as a swing-high resistance that aligns close to a 127.2% Fibonacci extension level, marking a significant barrier that could cap further upward movements.
AUD/USD:
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Price has broken below the pivot and could potentially drop towards the 1st support
Pivot: 0.6397
Supporting reasons: Previously functioned as a pullback support which now has been broken due to the strong bearish momentum.
1st support: 0.6348
Supporting reasons: Acts as a swing-low support, suggesting a significant area where price has previously found strong support and could provide a basis to halt further downward movement.
1st resistance: 0.6447
Supporting reasons: Identified as a pullback resistance, marking a barrier that has previously capped upward movements.
NZD/USD
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Price has broken below the pivot and could potentially drop towards the 1st support
Pivot: 0.5863
Supporting reasons: Previously functioned as a pullback support which now has been broken due to the strong bearish momentum.
1st support: 0.5779
Supporting reasons: Acts as a swing-low support, suggesting a potential area for price stabilization or a minor rebound within the bearish context.
1st resistance: 0.5930
Supporting reasons: Identified as a pullback resistance, marking a barrier that has previously capped upward movements.
US30 (DJIA):
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Price has broken below the pivot and could potentially drop towards the 1st support
Pivot: 37,672.13
Supporting reasons: Previously functioned as a pullback support which now has been broken due to the strong bearish momentum.
1st support: 37,164.30
Supporting reasons: Identified as a pullback support, suggesting a significant area where price has previously found strong buying interest and could provide a solid foundation to halt further downward movement.
1st resistance: 38,025.73
Supporting reasons: Identified as a pullback resistance, indicating a potential barrier that could cap any upward movements.
DE40 (DAX):
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Price has broken below the pivot and could potentially drop towards the 1st support
Pivot: 17,666.40
Supporting reasons: Previously functioned as a pullback support which now has been broken due to the strong bearish momentum.
1st support: 17,431.30
Supporting reasons: Acts as a pullback support that aligns with a 61.8% Fibonacci retracement level, suggesting a significant area where price has previously found strong buying interest and could provide a solid foundation to halt further downward movement.
1st resistance: 17,901.10
Supporting reasons: Identified as a pullback resistance that aligns with 23.6% Fibonacci retracement level, potentially functioning as a barrier that could cap any upward movements.
US500 (S&P 500):
Potential Direction: Bearish
Overall momentum of the chart: Bearish
Price has broken below the pivot and could potentially drop towards the 1st support
Pivot: 4,953.70
Supporting reasons: Previously functioned as a pullback support which now has been broken due to the strong bearish momentum.
1st support: 4,848.25
Supporting reasons: Acts as a pullback support suggesting a significant area where price has previously found strong buying interest, providing a solid foundation to halt further downward movement.
1st resistance: 5,006.20
Supporting reasons: Marked by a pullback resistance, which could function as a potential barrier and cap any upward movements.
BTC/USD (Bitcoin):
Potential Direction: Bullish
Overall momentum of the chart: Neutral
Price could potentially make a bullish reaction off the pivot and rise towards the 1st resistance
Pivot: 59,525.62
Supporting reasons: Acts as a pullback support that aligns with the 61.8% Fibonacci retracement and the 161.8% Fibonacci extension levels, suggesting a significant area where price has previously found strong buying interest and could provide a solid foundation for potential price stabilization or a rebound
1st support: 52,866.49
Supporting reasons: Acts as a pullback support, suggesting a significant area where price has previously found strong buying interest and could provide a solid foundation for potential price stabilization or a rebound.
1st resistance: 64,275.47
Supporting reasons: Marked by a pullback resistance that aligns close to a 38.2% Fibonacci retracement, indicating a significant barrier that could cap further upward movements.
ETH/USD (Ethereum):
Potential Direction: Bullish
Overall momentum of the chart: Neutral
Price could potentially make a bullish reaction off the pivot and rise towards the 1st resistance
Pivot: 2,847.25
Supporting reasons: Identified as an overlap support that aligns close to a 61.8% Fibonacci retracement level suggesting a significant area where price has previously found support, providing a strong foundation for a potential rebound.
1st support: 2,685.96
Supporting reasons: Identified as an overlap support that aligns close to a 78.6% Fibonacci retracement level suggesting a significant area where price has previously found support, providing a strong foundation to halt further downward movements.
1st resistance: 3,111.04
Supporting reasons: Identified as an overlap resistance, marking a significant barrier that could cap further upward movements.
WTI/USD (Oil):
Potential Direction: Bullish
Overall momentum of the chart: Bullish
Price has made a bullish reaction through the pivot and could potentially rise towards the 1st resistance
Pivot: 82.68
Supporting reasons: Previously functioned as an overlap resistance which now has been broken due to the strong bullish momentum.
1st support: 81.01
Supporting reasons: Identified as a pullback support that aligns with a 61.8% Fibonacci retracement level, suggesting a significant area where price has previously found strong buying interest and could provide a solid foundation to halt further downward movements.
1st resistance: 87.77
Supporting reasons: Identified as a pullback resistance, marking a significant barrier that could cap further upward movements.
XAU/USD (GOLD):
Potential Direction: Bullish
Overall momentum of the chart: Bullish
Price could potentially make a: Bullish bounce off pivot and heads towards 1st resistance
Pivot: 2404.73
Supporting reasons: Pullback resistance, indicating a level where selling pressure might intensify, potentially providing a barrier to further upside movement.
1st support: 2363.29
Supporting reasons: An Overlap support, suggesting a level where buyers might step in to support the price, potentially providing a foundation for a bounce or temporary halt in the bullish momentum.
1st resistance: 2431.00
Supporting reasons: Swing high resistance, representing a level where selling pressure might increase, potentially acting as a barrier to further upside movement.
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By IC Markets
Powell and the FOMC are poised to maintain current rates in March. With a focus on 2024's rate cuts and the dollar's fate, explore how Fed decisions could shape economic landscapes and forex markets.
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