Nasdaq Composite Technical Analysis 0 (0)

Yesterday,
the Nasdaq Composite finished the day positive as a big drop in the price index
in the ISM Services PMI turned the sentiment around and quelled some
inflation fears. In fact, the market stayed under pressure since the hot ISM Manufacturing PMI on Monday as the increase in the price index
renewed fears of a reacceleration in inflation. For now, the market might take
a sigh of relief, but all eyes then will turn on the US CPI report next
Wednesday.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq
Composite has
been diverging with
the MACD for a
long time. This is generally a sign of weakening momentum often followed by
pullbacks or reversals. The price recently broke out of the rising wedge and
bounced on the key 16206 level where we had also the red 21 moving average for confluence. This
is a critical support zone as a continuation to the downside should trigger a
major correction with the 14500 level as the ultimate target.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that the
price bounced on the 16206 level where we had also the 61.8% Fibonacci
retracement
level for confluence. The buyers stepped
in with a defined risk below the Fibonacci level to position for a rally into a
new all-time high, but they will need the price to rise back above the trendline to
increase the momentum. The sellers, on the other hand, will want to see the
price reversing and breaking below the Fibonacci level to pile in more
aggressively into new lows.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see more
closely the recent price action with the strong bounce yesterday following the
ISM Services PMI release. We can see that we have a counter-trendline that
acted as resistance lately. If the price were to break above this
counter-trendline, we can expect the buyers to increase the bullish bets into a
new all-time high. The sellers, on the other hand, will likely lean on the
counter-trendline to position for a break below the Fibonacci level with a
better risk to reward setup.

Upcoming
Events

Today we will see the latest US Jobless Claims
figures, while tomorrow we conclude the week with the US NFP report.

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

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Heads up for ISM services PMI coming up at 14:00 GMT 0 (0)

At 14:00 we are expecting the march release of the ISM services PMI.

Markets will be paying additional attention to this one following the upside surprise in the manufacturing data on Monday.

With the last print, majority of measures stayed in expansion, while employment was the only sub-index that remained below 50.

I think markets will be paying particular attention to the prices paid component after the solid jump we had in manufacturing prices.

It goes without saying, but when analyzing ISM releases, don’t just focus on the headline number itself.

That usually get the first initial reaction, but markets soon digest the rest of the sub-indexes to get a better sense of how good or how bad the data was.

Make sure to include all of the components into your analysis.

This article was written by Arno V Venter at www.forexlive.com.

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US mortgage applications prints at -0.6% versus expected of -0.7% 0 (0)

US mortgage applications data:

  • MBA mortgage applications: -0.6% (prior -0.7%)
  • Mortgage market index: 195.6 (prior 196.8)
  • MBA purchase index: 145.6 (prior 145.7)
  • MBA refinancing index: 4536.5 (prior 460.9)
  • MBA 30-year mortgage rate: 6.91% (prior 6.93%)

Notes on mortgage application data:

Indexes are adjusted for seasonal variations. The changes in percentages for these indexes and the
difference in the mortgage rate are compared with the previous week. The
Mortgage Bankers Association (MBA) survey, which has been done every week since
1990, includes more than 75% of all home loan applications in the U.S. People
who take part in this survey include mortgage bankers, commercial banks, and
savings institutions

This article was written by Arno V Venter at www.forexlive.com.

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WTI Crude Oil Technical Analysis 0 (0)

Crude Oil recently broke
through the key $83 resistance following the strong US ISM Manufacturing PMI and some geopolitical risk in the
Middle East after Israel killed an Iranian general. For now, the fundamentals support
more upside for Crude Oil as we are seeing a reacceleration in economic
activity and the pickup in China’s performance seems to be gathering steam.

WTI Crude Oil Technical
Analysis – Daily Timeframe

On the daily chart, we can see that Crude Oil broke
through the key $83 resistance where we
had also the upper bound of the channel as an extra barrier. This breakout
should point to further gains ahead with the $89 level as the next target. If
the price were to pull back to retest the resistance now turned support, the
buyers should step in with a defined risk below it to position for a rally into
the $89 level. The sellers, on the other hand, will want to see the price
breaking lower to invalidate the bullish setup and position for a drop into the
lower bound of the channel around the $78 level.

WTI Crude Oil Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that we can find
some more confluence around
the $83 support as we can find the red 21 moving average and the
38.2% Fibonacci retracement level.
If the price were to extend the pullback though, the buyers will have the trendline and the
61.8% Fibonacci retracement level as the last line of defence. Below the
trendline, the sellers will regain control and we could see a selloff back into
the $78 level.

WTI Crude Oil Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that the
latest leg higher diverged with
the MACD which
is generally a sign of weakening momentum often followed by pullbacks or
reversals. In this case, it should signal a pullback into the minor trendline
where we can also find the 38.2% Fibonacci retracement level for confluence.
All these setups will be dip-buying opportunities for the buyers but depending
on the strength of the momentum and the economic data, the price might bounce
from either level. For this reason, the buyers might want to split their orders
or wait for a catalyst to pile in.

Upcoming Events

Today we have the US ADP and the US ISM Services
PMI. Tomorrow, we get the latest US Jobless Claims figures while on Friday we
conclude the week with the US NFP report. Weak data is likely to weigh on Crude
Oil in the short term, while strong figures should give it a boost.

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

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Quick snapshot of what is priced for major central banks 0 (0)

Below is a handy table that shows what type of interest rate changes are expected for the major central banks over their next few policy decisions.

Markets have certainly come a long way in pricing out some of the aggressive cuts we saw at the start of the year.

There was a lot of chatter on Monday about the first rate cut for the Fed being pushed back to September.

I don’t think that tells the whole story though.

Yes, technically the first cut is fully priced in for September, but there is still 24 basis points of cuts implied for July, which is just a whisker away from 25.

Other pricing that I’m keeping an eye on this week is for the SNB. Markets are currently pricing a 71% probability of a cut in June.

Which means Thursday’s inflation data will be important for how that view evolves.

This article was written by Arno V Venter at www.forexlive.com.

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Nasdaq Composite Technical Analysis 0 (0)

Yesterday, the Nasdaq Composite opened the day lower
but traded mostly higher into the close. The market got pressured by the strong
US ISM Manufacturing PMI report
on Monday which gave a boost to the US Dollar and Treasury yields. Inflation is
gradually becoming again the threat for further gains and the expectations for
rate cuts continue to dwindle with the market now being much less certain on a
rate cut in June. These fears might end up in some general profit-taking into
the US CPI report next week as another hot release could really spook the
market and trigger a change in the Fed’s stance.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq
Composite has
been diverging with
the MACD for a
long time. This is generally a sign of weakening momentum often followed by
pullbacks or reversals. The price yesterday broke out of the rising wedge and
bounced on the key 16206 level where we have also the red 21 moving average for confluence. This
is a critical support zone as a continuation to the downside should trigger a
major correction with the 14500 level as the ultimate target.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that the
price bounced on the 16206 level where we can also find the 61.8% Fibonacci
retracement
level for confluence. The buyers should
step in around this level with a defined risk below it to position for a rally
into a new all-time high. The sellers, on the other hand, will want to see the
price breaking lower to increase the bearish bets into new lows.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see more
closely the recent price action with the big negative gap yesterday and the
bounce on the critical support zone.
We now have a resistance zone around the 16300 level where we can find the
confluence of the red 21 moving average and the two trendlines. This
is where the sellers are likely to step in with a defined risk above the top
trendline to position for a break of the support with a better risk to reward
setup. The buyers, on the other hand, will want to see the price breaking above
the top trendline to invalidate the bearish setup and increase the bullish bets
into new highs.

Upcoming
Events

Today the US ADP and the US ISM Services PMI. Tomorrow,
we get the latest US Jobless Claims figures while on Friday we conclude the
week with the US NFP report.

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

Go to Forexlive

ForexLive European FX news wrap: FX guarded as bond yields push higher 0 (0)

Headlines:

Markets:

  • AUD leads, CHF lags on the day
  • European equities mixed; S&P 500 futures down 0.3%
  • US 10-year yields up 2.8 bps to 4.357%
  • Gold up 0.4% to $2,259.26
  • WTI crude up 1.5%o $85.10
  • Bitcoin down 6.1% to $65,495

It was mostly a slow session for major currencies but it may not stay that way when we get to US trading later. Bond yields are on the move again with 10-year Treasury yields now inching higher to test the key threshold of 4.35%. It is up to its highest levels for the year now, as the selling in bonds continue upon the turn of the month.

The dollar is yet to pick up much on that, trading more mixed and little changed on the day mostly. In FX, the Swiss franc is the only decent mover as it drops a little more. USD/CHF is at its best levels for the year in a push to 0.9090 and keeping thereabouts still.

In other markets, gold remains unperturbed as it keeps higher and looks towards $2,260 levels once more. But equities are feeling a bit of the pinch amid higher yields, with S&P 500 futures now down 0.3% on the day.

Elsewhere, Bitcoin is coming under strong pressure in a steep drop under $70,000 to $65,000 levels at the moment.

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

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AUDUSD Technical Analysis 0 (0)

USD

  • The Fed left interest rates unchanged as
    expected with basically no change to the statement. The Dot Plot still showed
    three rate cuts for 2024 and the economic projections were upgraded with growth
    and inflation higher and the unemployment rate lower.
  • Fed Chair Powell
    maintained a neutral stance as he said that it was premature to react to the
    recent inflation data given possible bumps on the way to their 2% target.
  • The US CPI and
    the US PPI beat
    expectations for the second consecutive month.
  • The US Jobless Claims beat
    expectations last week.
  • The US ISM
    Manufacturing PMI
    beat expectations by a big margin with
    the prices component continuing to increase.
  • The US Consumer
    Confidence
    missed expectations although the labour
    market details improved.
  • The market now sees basically a 50/50 chance of a
    cut in June.

AUD

  • The
    RBA left interest rates unchanged as expected at the last meeting and
    finally dropped the tightening bias.
  • The
    last Monthly CPI report came in line with
    expectations although the underlying inflation measure increased from the prior
    month.
  • The
    latest labour market report missed expectations by a big
    margin.
  • The
    wage price index surprised to the upside as wage
    growth in Australia remains strong.
  • The
    latest Australian PMIs showed the Manufacturing PMI falling
    further into contraction while the Services PMI continue to increase and remain
    in expansion.
  • The
    market expects the first rate cut in August.

AUDUSD Technical
Analysis – Daily Timeframe

On the daily chart, we can see that AUDUSD broke
again below the key 0.65 support zone and
it’s now looking towards the 0.6443 low. That’s where we can expect the buyers
to step in with a defined risk below the level to position for a rally back
into the 0.6623 level. The sellers, on the other hand, will want to see the
price breaking lower to increase the bearish bets into the 0.63 handle.

AUDUSD Technical Analysis –
4 hour Timeframe

On the 4 hour chart, we can see that the pair seems
to be trading inside a falling channel. If we get a bigger pullback from the
current levels, we can expect the sellers to lean on the upper bound of the
channel to position for a drop into the lows with a better risk to reward
setup. The buyers, on the other hand, will need the price to break above the
upper bound of the channel to invalidate the bearish setup and trigger a rally
into the 0.6623 level.

AUDUSD Technical Analysis –
1 hour Timeframe

On the 1 hour chart, we can see more
closely the recent price action with the pair now getting rejected from the
resistance zone. The sellers might pile in around these levels already if we
get strong US data or wait for a pullback into the top trendline in case the
data misses estimates.

Upcoming Events

Today we have the US Job Openings and tomorrow the
US ADP and the US ISM Services PMI. On Thursday, we get the latest US Jobless
Claims figures while on Friday we conclude with the US NFP report.

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

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Traders getting less certain about a Fed rate cut in June 0 (0)

The market pricing is showing that the odds of a June move have been reduced to ~62% now. That is down from ~68% at the end of last week here. And according to the CME Fedwatch tool, a 25 bps rate cut is now paired with just a ~56% probability. If anything, it suggests that we are looking at more of a coin flip ahead of the next big set of data points in the next two weeks.

Bond traders are also starting to act up as already seen yesterday. I shared some technical levels to be mindful of here and we are starting to see that come into play. 10-year yields are now up 2 bps today to 4.349% and is knocking on the door of the recent 4.35% ceiling.

It isn’t exactly reverberating across broader markets just yet but if the key level breaks, I reckon traders will start to pay more attention. Watch this space.

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 opened the day
higher and after a brief rally the price reversed completely following the
strong US ISM Manufacturing PMI report.
The US Dollar and Treasury yields rose to the highest levels this year putting
some downward pressure on the stock market. Inflation is gradually becoming
again the threat for further gains and the expectations for rate cuts continue
to dwindle with the market now seeing basically a 50% chance of a cut in June.
The Fed might also change its tone to a more hawkish stance.

Nasdaq Composite Technical
Analysis – Daily Timeframe

On the daily chart, we can see that the Nasdaq
Composite 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, and
it’s worth to keep an eye on it because 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.

Nasdaq Composite Technical
Analysis – 4 hour Timeframe

On the 4 hour chart, we can see that the
price is consolidating near the bottom trendline where we have the red 21 moving average for confluence. The
buyers keep on stepping in with a defined risk below the trendline to position
for a rally into a new all-time high. The sellers, on the other hand, are
waiting for the price to break below the trendline to increase the bearish bets
and target new lows.

Nasdaq Composite Technical
Analysis – 1 hour Timeframe

On the 1 hour chart, we can see that the
gains have been capped by the counter-trendline and even if we got a brief
spike to the upside yesterday, the price fell back below the counter-trendline.
The buyers will likely pile in if we get a break to the upside and increase the
bullish bets in case we get a break above the 16480 level.

Upcoming
Events

Today we have the US Job Openings and tomorrow the
US ADP and the US ISM Services PMI. On Thursday, we get the latest US Jobless
Claims figures while on Friday we conclude the US NFP report.

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

Go to Forexlive