ECB’s Holzmann: A rate cut is in preparation 0 (0)

  • But the timing of the rate cut is unclear
  • We are data dependent
  • There are many who believe that developments in June will be such that we can cut at the time
  • My view is that inflation is stickier than those people believe, which is why I am waiting for June data

Hmm, is he alluding to a move in July instead? For now, he seems to be the only one with a bit of vagueness in his remarks. Most of the other policymakers at the ECB are leaning towards June. And unless the data suggests otherwise, markets will continue to price in the first move for June as well.

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

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UK March CBI trends total orders -18 vs -20 prior 0 (0)

The monthly order book balance shows just a marginal improvement in March. But the standout detail is perhaps that manufacturers are looking to increase selling prices by the most since last May. This owes to continued disruptions in the Red Sea, hurting supply chains. That might be a risk factor for the BOE to watch out for in the months ahead.

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

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Nasdaq Composite Technical Analysis 0 (0)

Yesterday, the Nasdaq Composite closed the day
negative as the price retreated from overstretched levels reached after the Fed
decision. We also got another slate of strong US data yesterday with the US Jobless Claims beating
expectations and the US Manufacturing PMI
increasing further into expansion. The comments in the PMI report were a bit
worrying as there were mentions of steep rise in costs and strengthened
pricing power amid the recent upturn in demand. This pushed the overall
selling price inflation for goods and services up to the highest levels for
nearly a year. The next inflation report will be crucial for the market as
another beat will likely be taken as very bad news at this point.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq
Composite yesterday retreated from the all-time high as the market pulled back
from the overstretched rally triggered by the FOMC decision. There’s not much
we can glean from this timeframe, so we need to zoom in to see some more
details.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that
the price has been diverging with
the MACD for a
long time. This is generally a sign of weakening momentum often followed by
pullbacks or reversals. We continue to trade inside the rising wedge, so if
the price were to break below the trendline, the
sellers will have much more conviction to look for new lows with the base of
the wedge at 14477 being the ultimate target. For now, the buyers remain in
control, so we should find them around the bottom trendline targeting the top
trendline.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see the recent
breakout of the resistance. From a risk management perspective, the buyers will
have a much better risk to reward setup around the trendline where they will
also find the red 21 moving average and
the Fibonacci
retracement
levels for confluence. The
sellers, on the other hand, will need to wait for the break of the major
trendline before considering new positions.

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

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ForexLive European FX news wrap: Swiss franc falls as SNB surprises with rate cut 0 (0)

SNB:

Headlines:

Markets:

  • AUD leads, CHF lags on the day
  • European equities higher; S&P 500 futures up 0.4%
  • US 10-year yields down 3.8 bps to 4.233%
  • Gold up 0.9% to $22,06.43
  • WTI crude down 0.3% to $80.50
  • Bitcoin up 0.1% at $67,170

As the window of opportunity is opening up for central banks to cut rates, the SNB is not waiting around to make its move. The Swiss central bank surprised with a 25 bps rate cut today and the franc fell as a result. We all knew that there was a chance that they could have surprised markets, but traders were caught wrongfooted after having priced in the first move for June instead.

EUR/CHF rose to its highest since July last year from 0.9680 to 0.9780, before easing back to 0.9740 now. Meanwhile, USD/CHF surged up to its highest levels for the year at 0.8975 before retreating to 0.8930 – still up 0.7% on the day.

Besides that, euro area PMI data saw some mixed readings for March. The manufacturing sector remains in recession but a stronger services sector is at least helping to stabilise the economy in general. The euro slipped with EUR/USD falling from 1.0920 to 1.0888 before sticking around 1.0900 with large option expiries also helping out.

As for the dollar itself, there was some post-Fed weakness during Asia trading. But that has dissipated somewhat in European morning trade so far, despite lower Treasury yields. USD/JPY was as low as 150.26 in Asia but has rebounded back to 151.10 now, down just 0.1% on the day.

In the equities space, stocks remain buoyed as European indices are sitting higher for the most part. US futures are also gaining further after the record closes in Wall Street yesterday.

And in the commodities space, gold continues to hold at fresh record highs above $2,200 as it consolidated gains above the figure level during the session.

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

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German economy likely in recession in Q1 2024 – Bundesbank 0 (0)

  • Industry in particular will likely remain in a weak phase
  • No major stimulus is expected from private consumption for the time being either
  • Uncertainty over major issues, like climate policy, also weighing on investment decisions
  • Inflation could fall further in the months ahead
  • But some fluctuation is likely as services inflation is coming down rather slowly

The PMI data earlier today here reaffirms the above sentiment.

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

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Dow Jones Technical Analysis 0 (0)

Yesterday, the Fed left interest rates unchanged as
expected with basically no change to the statement. The market was fearing some
hawkish stuff, but we didn’t get any. In fact, the Dot Plot showed still three
rate cuts for this year and the economic projections were all upgraded with
growth and inflation higher and the unemployment rate lower. Moreover, during
the press conference, Fed Chair Powell didn’t
sound hawkish, on the contrary, he was fairly neutral. This gave the Dow Jones
the green light for a rally as the risk sentiment turned very bullish.

Dow Jones Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Dow Jones surged
to a new all-time high following the Fed decision. This is a buyers’ market, so
the sellers should refrain from taking new positions until we get a change in
the risk sentiment and some key breakouts on the lower timeframes. We can also
notice that the price continues to diverge with the
MACD which is
generally a sign of weakening momentum often followed by pullbacks or
reversals. In this case, it should be telling that the buyers should buy the
higher lows instead of FOMOing at higher highs.

Dow Jones Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that
the price broke through the 39119 resistance and
triggered a strong bullish reaction as the buyers piled in aggressively for a
new all-time high. From a risk management perspective, the buyers will have a
much better risk to reward setup around the resistance now
turned support
where there’s also the 38.2% Fibonacci
retracement level
for confluence. The
sellers, on the other hand, will want to see the price breaking lower to
position for a drop into the 38464 level.

Dow Jones Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that we
also have a minor trendline around the support zone where the buyers will
likely lean onto to position for new highs with a better risk to reward setup.
The sellers, on the other hand, will want to see the price breaking lower to
position for a drop into the 39464 level.

Upcoming Events

Today we will get some key economic data as we will
see the latest US Jobless Claims figures and the US PMIs.

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

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Web3 Base Layer – Mystiko.Network Completed an 18 Million USD Seed Funding Round 0 (0)

Mystiko.Network, the leading Base Layer
of Web3, has completed a 18 Million USD seed funding round led by Sequoia
Capital India/SEA (now known as Peak XV Partners), with participation from
Samsung Next, Hashkey, Mirana, Signum, Coinlist, Naval Ravikant, Sandeep
Nailwal, Gokul Rajaram, Tribe Capital, Morningstar Ventures, etc.

In less
than a year, Mystiko V1 mainnets have supported over 134 Million USD
transaction volume, 214K+ transactions on 5 different layer1/layer2
blockchains, with 54K+ unique active onchain users.

Previously,
Mystiko.Network has also been selected to participate in esteemed programs such
as Binance MVB, Chainlink Startup, Polygon Ecosystem and Coinlist Seed.

About
Mystiko.Network

Mystiko.Network (https://mystiko.network/) is the Base Layer of WEB3.
Mystiko SDK, the universal ZK SDK, features scalability, interoperability, privacy,
and AI for every blockchain/dapp all at once.

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

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Treasury yields retreat further post-Fed but nears key technical juncture 0 (0)

After nearing the highs for the year earlier this week, 10-year Treasury yields have come down a fair bit. The move lower was helped by a more dovish Fed yesterday, with the rebound last week now resembling a double-top pattern. But as yields retreat, they are nearing a key technical juncture on the chart as well.

Yields are now at 4.229% and are nearing the confluence of its 100-day (purple line) and 200-day (green line) moving averages at 4.204% to 4.220%.

A fall below that will see bond buyers seize back control with yields potentially slipping back to the March lows near 4.09%. But if yields hold above the key technical region, that might keep dollar selling more limited for the time being.

So far today, the drop in yields isn’t weighing on the dollar all too much. The greenback was softer in Asia trading but has recovered some decent ground so far in Europe.

USD/JPY is a good example of that, now trading near 151.00 after having hit a low of 150.26 earlier in the day. It is off earlier highs just a few hours ago at 151.45 though as yields start to retreat further now.

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

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ForexLive European FX news wrap: Dollar nudges higher with the Fed in focus 0 (0)

Headlines:

Markets:

  • USD leads, JPY lags on the day
  • European equities mixed; S&P 500 futures up 0.1%
  • US 10-year yields down 0.9 bps to 4.288%
  • Gold down 0.2% to $2,154.03
  • WTI crude down 0.9% to $82.02
  • Bitcoin down 0.8% to $63,199

It was a slower session after a busy Tuesday yesterday, as markets are waiting on the FOMC meeting later today.

The dollar is keeping firmer across the board with traders seemingly positioning for more of a hawkish hold perhaps. 10-year Treasury yields holding near 4.30% still is also a factor underpinning the greenback since last week. Besides that, softer UK and Canada inflation, a sell the fact play on the BOJ, and a dovish RBA makes for a couple of reasons why traders are still favouring the dollar this week.

USD/JPY continued to race higher to 151.80 as it eyes its 2022 and 2023 highs of 151.90-94 ahead of the Fed. Meanwhile, EUR/USD is contesting its 200-day moving average again as it is down 0.2% to 1.0840. GBP/USD is also marked down by 0.2% to just under 1.2700 currently.

Looking at the commodity currencies, USD/CAD is retesting the 1.3600 mark once again after offers resisted a break of the figure level yesterday. And AUD/USD is down 0.2% to 0.6515 and closes in on a potential test of the 0.6500 mark.

In the equities space, French luxury stocks are the ones lagging in Europe after Kering warned of a 10% revenue slide in Q1. Other regional indices are more mixed with US futures also just marginally higher as equities keep little changed in general.

Bitcoin was a decent mover as the volatile swings continue in the last one week. It fell to a low of $60,780 before recovering back to just above $63,000 now on the day.

Over to the Fed now.

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

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US MBA mortgage applications w.e. 15 March -1.6% vs +7.1% prior 0 (0)

  • Prior +7.1%
  • Market index 198.2 vs 201.5 prior
  • Purchase index 146.0 vs 147.7 prior
  • Refinance index 468.4 vs 480.3 prior
  • 30-year mortgage rate 6.97% vs 6.84% prior

The average rate of the most popular US home loan surges higher by 13 bps in the past week, nearing the 7% mark again. That put a bit of a drag on mortgage applications, with both purchases and refinancing activity slipping lower.

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

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