A technical look at the major currency pairs for the week starting February 19, 2024:

EURUSD:

USDJPY:

GBPUSD:

USDCHF:

USDCAD:

AUDUSD:

NZDUSD:

This article was written by Greg Michalowski at www.forexlive.com.

The following video shows my opion and bitcoin price forecast with some trade ideas

• Current Position: Bitcoin hovers around $51,615, facing double resistance. 🚫📈
• Market Movement: Recent break from a bullish pattern, now at a pivotal bearish juncture. 📉🐻
• Trade Strategy: Bearish bias with a stop-loss above $54,300 for risk management. 🛑💡
• Position Sizing: Adjust size for an optimal reward-to-risk ratio; aim for meaningful profits. ⚖️💼
• Profit Targets: First partial profit at a cautious 1.32 reward-to-risk, with a long-term aim below $50,000. 🎯💵
• Adjustments: Refine stop-loss and targets for a potential average ratio of 1.65, enhancing trade viability. 🔧📊
• Risk Mitigation: For non-traders, consider reducing exposure to mitigate risk at this uncertain juncture. 🛡️👀

This snapshot provides a strategic outlook for navigating Bitcoin’s volatility. Remember, trade wisely and at your own risk. For more detailed guidance and updates, as well as other views, follow ForexLive.com. 🌐💡

This article was written by Itai Levitan at www.forexlive.com.

• US January PPI +0.9% vs +0.6% expected
• US February UMich prelim consumer sentiment 79.6 vs 80.0 expected
• US January housing starts 1.331 million versus 1.460 million estimate
• SF Fed Pres.Mary Daly: More work to do on inflation
• Daly Q&A: None of the recent data was surprising
• BOE’s Pill: Getting to the point of reducing Bank Rates „still some way off“
• Joe Manchin won’t run for President – report
• Trump fined $364 million in fraud case
• Fed’s Bostic says he was a little surprised by CPI report
• Baker Hughes rig count -2 in the current week.
• Fed’s Barr: Supervisors closely focused on commercial real estate risks
• Fed’s Barkin: January economic data has been messy, not that good
• Canada December wholesale sales +0.3% vs +0.8% expected

Markets:

• Gold up $9 to $2013
• US 10-year yields up 4.3 bps to 4.28%
• WTI crude oil up $1.20 to $79.23
• S&P 500 down 0.5%
• NZD leads, JPY lags

The hot PPI reading initially looked like it would kick off something like CPI did earlier in the week, albeit at a smaller scale. The dollar initially sold off, stocks fell and yields popped but it didn’t last. The dollar highs for the day were immediately after the release and then the questions started.

As I highlighted before the release, there might be seasonal adjustment factors at play in January BLS inflation data. CPI and import/export prices were both surprisingly high and now PPI has joined in to complete the trio. Those are three different data sets but all are seasonally adjusted so maybe there is something going on? January is particularly hard to adjust for because of turn-of-the-year price resets.

Or maybe I’m overthinking it. Fed officials today again brushed off the high inflation numbers, highlighting instead that the trend remains down. The big turn in the markets this week came after the Powell leak on Tuesday and that has grown into the consensus.

In any case, the dollar gave back all its PPI gains in about 90 minutes and then continued even lower against the euro, pound and Australian dollar. However those overshoots were later faded as stocks were hit by late selling. I’m not sure if those late moves in stocks were on options expiration, Middle East worries or the long weekend but the moves accelerated late. The air also came out of SMCI so maybe that’s a sign that the bubble is deflating in AI (though I doubt it’s bursting).

Ultimately, most FX levels finished close to flat. I’ll be watching on Sunday for news out of the PBOC on rates and I suspect some of the buying in Chinese stocks, copper and antipodeans on Friday were related to rate cut hopes/signals, or some other kind of stimulus.

Commodities were notable outperformers across the board with gold quickly rebounding from the PPI number and oil bouncing around before finishing just below the January high That will be an interesting spot to watch in the week ahead.

Enjoy the long weekend.

This article was written by Adam Button at www.forexlive.com.

The major US stock indices are closing lower on the day and for the trading week. The declines for the weeks snap a 5-week winning streak. The declines on the day come after two days of higher closes. The NASDAQ and the Russell 2000 were the biggest losers as rates moved higher, and some of the high flyers saw profit-taking.

The final numbers are showing:

• Dow industrial average fell -145.15 points or -0.37% at 38627.98
• S&P index fell -24.16 points or -0.48% at 5005.56
• NASDAQ index fell -130.53 points or -0.82% at 15775.64

For the Russell 2000 it fell -28.73 points or -1.39% at 2032.74

For the trading week:

• Dow Industrial Average fell -0.11%
• S&P index fell -0.42%
• NASDAQ index fell -1.34%

For the Russell 2000 and actually rose 1.132% this week.

Looking at some of the big movers:

• Super Micro Computers after extending up to a high $1077, tumbled and closed at $803 down $201 or -20.02%.. Despite the tumbled the shares still rose 8.51% this week
• Adobe tumbled $-43.78 or -7.41% to $546.66. Shares of Adobe fell -12.84% this week.
• Meta fell $-10.70 or -2.21% at $473.33. For the week who rose 1.11%
• Alphabet fell $-2.25 or -1.58% at $140.52. For the week shares tumbled -5.69%
• Microsoft fell $-2.50 or -0.61% at $404.06. For the week the shares fell -3.92%
• Arm Holdings fell $-5.34 or -3.99% at $128.34. For the week, the shares still rose 11.4%.
• Broadcom fell $-19.59 or -1.55% at 1245.48. For the week, the shares fell -2.96%
• Micron fell $-2.13 or -2.61% at $79.50. For the week, the shares fell -7.08%
• Apple fell $-1.56 or -0.85% at $182.24. For the week, shares-5.69%
• Nvidia shares fell $-0.45 or -0.06% at $726.13. For the week, shares rose 0.66%. Nvidia reports its earnings next week.

This article was written by Greg Michalowski at www.forexlive.com.

Here’s the latest from the New York Times:

Israel carried out covert attacks on two major gas pipelines inside Iran
this week, disrupting the flow of heat and cooking gas to provinces
with millions of people, according to two Western officials and a
military strategist affiliated with Iran’s Revolutionary Guards Corps.

Now I don’t know if that’s true or false. Earlier blame was placed groups in Saudi Arabia and other enemies in Iran. A chemical factory explosion was also done by Israel, according to the report.

What I can’t figure out is why this was leaked. To be clear, there are no ‚old fashioned‘ leaks on stuff like this except in extraordinary cases like Edward Snowden. When leaks like this happen — especially to the New York Times — it’s deliberate.

The ‚two Western officials‘ is vague but rules out Iran but it’s an odd thing for US officials to leak because it would seemingly escalate things towards a war that they seem to be trying to avoid.

Maybe this is a clue:

One Western official called it a major symbolic strike that was fairly
easy for Iran to repair and caused relatively little harm to civilians.
But, the official said, it sent a stark warning of the damage that
Israel could inflict, as conflict spreads across the Middle East and
tensions rise between Iran and its adversaries, notably Israel and the
United States

For me, that doesn’t add up because Iran would obviously know Israel is capable of sabotaging a pipeline, which is a trivial thing to do at the state level. Israel has sabotaged nuclear facilities in Iran and killed people, which are obviously tougher tasks.

Your guess is as good as mine as to what’s going on here. These are the three reporters behind the story:

This article was written by Adam Button at www.forexlive.com.

Likely Republican Presidential candidate Donald Trump will have to write another big check after he lost a civil fraud case in New York. A judge fined him $364 million and barred him from running any business in the state for three years.

During the three-month trial he was accused of inflating asset values in order to get better terms on loans.

“In order to borrow more and at lower rates, defendants submitted
blatantly false financial data to the accountants, resulting in
fraudulent financial statements,” presiding judge Arthur Engoron wrote. “When confronted at
trial with the statements, defendants’ fact and expert witnesses simply
denied reality, and defendants failed to accept responsibility or to
impose internal controls to prevent future recurrences.”

The case was littered with legal mistakes from Trump’s team.

He will surely appeal but under New York law he will be required to put up a large chunk of the damages in escrow.

In a separate case last year of sexual assault and defamation he lost and was fined $88.3 million.

He remains the betting favourite to be in the White House at this time next year.

This article was written by Adam Button at www.forexlive.com.

It’s been a fairly quiet session so far, underscored by some mixed signals in broader markets after yesterday’s action. The dollar is keeping steadier on the day, finding little conviction in European trading. That is somewhat understandable as we await more US data to come later today.

USD/JPY is up slightly by 0.2% with 10-year yields also slightly higher by 2 bps to 4.26%. That’s not much but at least the pair is holding back above 150.00 for now.

Meanwhile, other dollar pairs are even more lethargic today. EUR/USD is flattish around 1.0774 with large option expiries keeping price action in check. GBP/USD is also lightly changed after the UK retail sales report, holding just below 1.2600. Elsewhere, commodity currencies are also muted after the back and forth action against the dollar this week.

US futures are slightly higher but that’s not really translating to anything in FX at the moment. I mean, stocks are in a world of their own so that isn’t the most surprising thing.

It looks like we’re gearing towards the next set of US data to decide what comes next before the weekend. Coming up later, we’ll be getting US producer prices and the University of Michigan consumer sentiment and inflation expectations. Those might offer something for traders to work with as we look to wrap up the week.

This article was written by Justin Low at www.forexlive.com.

USD

• The Fed left interest rates unchanged as
  expected while dropping the tightening bias in the statement but adding a
  slight pushback against a March rate
  cut.
• Fed Chair Powell stressed
  that they want to see more evidence of inflation falling back to target and
  that a rate cut in March is not their base case.
• The US CPI beat
  expectations for the second consecutive month with the disinflationary trend
  reversing.
• The US Initial Claims beat
  expectations while Continuing Claims missed. Overall, the data remains steady.
• The ISM Manufacturing
  PMI
  surprised to the upside with the new orders index, which is considered a
  leading indicator, jumping back into expansion. Similarly, the ISM Services PMI beat
  expectations across the board with the employment sub-index erasing the prior
  drop and prices paid jumping above 60.
• The US Retail Sales missed
  expectations across the board by a big margin.
• The market now expects the first rate cut in June.

CAD

• The BoC left interest rates unchanged at
  5.00% as expected and dropped the language about being prepared to hike if
  needed.
• The latest Canadian CPI beat expectations across the board with
  the underlying inflation measures remaining elevated.
• On the labour market side, the latest report beat
  expectations but we saw a contraction in full-time employment and a fall in
  wage growth.
• The Canadian PMIs improved in
  January although they remain both in contractionary territory.
• The market expects the first rate
  cut in June.

USDCAD Technical Analysis –
Daily Timeframe

On the daily chart, we can see that USDCAD recently
broke out of the 1.3540 resistance
following the hot US CPI report but failed to sustain the rally as the pair
eventually erased all the gains. The price though made a new higher high so we
have a trendline now
where the buyers will likely step in with a defined risk below it to position
for a rally into the 1.3620 level. The sellers, on the other hand, will want to
see the price breaking lower to invalidate the bullish setup and increase the
bearish bets into the 1.3364 level.

USDCAD Technical Analysis –
4 hour Timeframe

On the 4 hour chart, we can see more closely the
pop and fade after the US CPI release. There’s not much to do here other than
waiting for the price to reach the trendline where the buyers will look for a
reversal and the sellers for a breakout.

USDCAD Technical Analysis –
1 hour Timeframe

On the 1 hour chart, we can see that if we
get a pullback from here, the sellers will likely lean on the downward
trendline where they will also find the confluence with
the 61.8% Fibonacci
retracement level. The buyers, on the other hand,
will want to see the price breaking higher to pile in and target a new high.

Upcoming Events

Today we get the US PPI data and the University of
Michigan Consumer Sentiment survey.

This article was written by FL Contributors at www.forexlive.com.

Tech shares are the ones leading the charge once again, with Nasdaq futures up 0.6% on the day. Dow futures are down slightly by 0.1%, so S&P 500 futures are up 0.2% at the balance currently.

It has been quite a breathtaking and unrelenting run in stocks since the end of October last year. And it doesn’t look like we’re stopping just yet.

The S&P 500 looks poised to retest record highs at the open later and the Nasdaq is getting ever closer to its own record highs. At the close yesterday, the latter is less than 2% shy of achieving just that.

This article was written by Justin Low at www.forexlive.com.

Cocoa is
currently experiencing unprecedented popularity, reaching an all-time high in
price on the New York exchange, hitting the $5800 mark by mid-February. The
price gained more than 30%, which is an all-time high. Let’s delve into the
factors driving this surge in the cocoa market and explore its potential
impacts on both markets and daily life.

To
begin, let’s take a look at the chart demonstrating cocoa price movements since
the beginning of 2024. The line is pretty straight. Additionally, as judged by the
volume indicator, the volume points are also high.

Over 30%
since the start of the year is massive, especially considering the relatively
short time frame of a month and a half. However, the following chart
illustrates even more remarkable growth. It began in 2023, with prices
skyrocketing by over 100%. Over the past five years, the increase has surpassed
150%.

However,
the critical change in the trend occurred not long ago – in 2023. There are two
factors affecting the industry that are tied to West African countries, Cote
d’Ivoire and Ghana, which are leaders in cocoa bean production.

The
first factor is the El Niño weather phenomenon, resulting in
warmer surface waters in the Pacific and subsequently causing hotter and drier
weather in the region. Such conditions lead to a decrease in harvest yields.

Simultaneously,
the cocoa trees are afflicted by the cacao swollen shoot virus, which has
plagued African farmers for the past few years. What’s more, they can’t replant
trees on the affected land for five years following the onset of the virus.
Earlier, farmers relocated to other forests to plant cocoa trees, but this
practice is restricted to preserve forests. With no cure for this disease, many
producers have opted to switch to alternative agricultural ventures.

Both of
these factors have significantly reduced cocoa supply, a trend that continues
to persist. Additionally, global tensions, such as those in the Red Sea, further exacerbate
concerns surrounding trade routes.

The
growth of cocoa prices naturally impacts both chocolate producers and
chocoholics. Higher prices may lead to increased costs for chocolate products,
potentially resulting in decreased sales volumes as consumers seek to
economize. However, the immediate effects of these changes may not be readily
apparent, as candy makers may choose to maintain prices to retain their
customer base.

This article was written by FL Contributors at www.forexlive.com.