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How Nervous are Forex and Equity Traders? We will Find Out

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

How Nervous are Forex and Equity Traders? We will Find Out

Key psychological levels in Forex continue to display that trading is anxious. The GBP/USD is battling under 1.26000, the USD/JPY is above 150.000 and the EUR/USD is below the 1.08000 level. Speculative Forex positions the past week were volatile.

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USD/JPY Three Month Chart as of 20th February 2024

The S&P 500, Nasdaq 100, and Dow Jones 30 all suffered declines last week. Forex and equity indices were turbulent because economic outlooks among financial institutions and their clients have become uneasy. The gaps suffered last week in the U.S equity indices are a clear indication of tension.

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Nasdaq 100 Five Day Chart as of 20th February 2024

Inflation data via the Consumer Price Index numbers last week certainly threw a grenade into the markets. Yields on U.S Treasuries have shown nervousness due to murky sentiment regarding what the Federal Reserve will do over the next handful of months. This week is likely to remain choppy.

Perhaps yesterday’s Presidents’ Day holiday in the U.S has given folks a chance to calm their nerves, but it may have also given them more time to fret and worry about risks. U.S data in the coming days will be relatively light, but next week’s economic reports which include GDP and Core PCE Price Index statistics will cause another dose of electricity to run through the financial markets. Until then behavioral sentiment generated by last week’s higher than anticipated inflation results will remain a guideline.

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Shanghai Composite Index (SSE) Three Month Chart as of 20th February 2024

Foreign Direct Investment numbers coming from China yesterday continued to show a troubling outlook for the nation as it battles deflation. While the Shanghai Composite Index has moved upwards since the lows hit in the first week of February, anxiety is being communicated about how the momentum is being attained via potential corporate ‘buy backs’. China’s economic outlook is a concern globally because of the potential knock-on affects.

The U.K’s inflation results last week and rather recessionary undertones are also concerns. Global economies outside of the U.S are struggling with the higher values of the USD, price pressures and struggling to achieve growth. Combined with China’s deflation, apprehension about stagflation in the ‘West’ is problematic.

Financial institutions and day traders have reasons to be nervous. Speculators looking for quick hitting wagers have been hurt by reactions from economic data recently. While it is tempting to say ‘disregard the numbers and look at technical charts’, the reality is that behavioral sentiment is rather jittery and results in Forex and equity indices are being hampered. As much as optimistic attitudes are needed for investing long-term, clear risk analysis should be used by traders who want to take advantage of momentary swings in value. Dangers reside.

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Gold Six Month Chart as of 20th February 2024

Which brings us to the conclusion regarding the current state of behavioral sentiment and potential signals – Gold, remains around the 2020.00 USD price. The steady range of Gold when looking at a six month chart may be the best of evidence that financial institutions and investors are in a wait and see mode. The 2020.00 level in Gold is more than a curiosity via its technical trading the past handful of months, it points directly to a cautiously optimistic attitude regarding a change to Federal Reserve monetary policy in the future.

In other words, it appears many financial players hold onto the notion the U.S Federal Reserve will eventually turn dovish. The precious metal above the 2000.00 USD mark may indicate a belief the USD is expected to turn weaker. Yet, instead of saying the mid-term, it is almost tempting now to say ‘eventually’, this because the U.S central bank like the BoE, ECB and BoJ and Reserve Bank of Australia remain docile. Day traders will have to continue to be extremely cautious in the days ahead.

Tuesday, 20th of February, Canada Consumer Price Index – the inflation numbers will be watched by Forex traders as an indication regarding the stubborn CPI results being produced in many nations as a correlation.

Wednesday, 21st of February, U.S FOMC Meeting Minutes – the report will provide insights regarding what the Federal Reserve was thinking during its last monetary policy meeting. However, the results will likely not cause much of a reaction, because last week’s CPI readings from the U.S has already altered the trading terrain.

Thursday, 22nd of February, Europe Purchasing Managers Index Manufacturing and Services – the reports which will come from across the E.U and Britain will nudge behavioral sentiment. Slight gains are being looked for in most of the reports, but the outcomes are actually expected to produce lackluster outlooks all below the important ratio of 50.

Thursday, 22nd of February, U.S PMI and Existing Home Sales – the manufacturing and services readings via the PMI results are expected to be negative. If the PMI numbers are weaker than expected this may spark some USD selling in Forex. Housing sales data is anticipated to show a slight rise, which would be intriguing and a potential sign buyers are hoping for cheaper U.S interest rates to develop mid and long-term.

Friday, 23rd of February, China New Home Prices – the housing sector in China plays an instrumental part of Chinese perspectives regarding wealth and economic health. The housing sector in China remains under a huge burden. Falling values in real estate is part of the deflation story in the nation and must continue to be monitored.

Friday, 23rd of February, Germany Final GDP – recessionary pressures are expected to remain strong in the country. Germany is seen as the ‘workhorse’ of Europe, but economic numbers from the nation have proven troublesome. The German Business Climate reading via the IFO will also be released, a slightly better outcome than the previous month is expected. The EUR/USD could move based on the sentiment generated via the data.

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AMT Top Ten Miscellaneous Raindrops for 16th of February

by with No Comment AMT MarketsArtificial IntelligenceFeatured Highlights

AMT Top Ten Miscellaneous Raindrops for 16th of February

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10. Bitcoin is trading within sight of 52,000.00 USD, the digital asset was trading near 38,700.00 on the 23rd of January, which is over 34% in less than a month. That’s a lot of air in the balloon folks.

9. Gold: The precious metal has climbed above 2000.00 USD, this after a drop to 1985.00 USD on the 14th of February. Sentiment is uneasy.

8. Not April Fool’s Day: Iran has announced ‘plans’ to build a naval base on Antarctica, after declaring ‘property rights’.

7. WTI Crude Oil: The price of the commodity continues to battle the 77.00 USD level. Higher energy costs will not be looked on favorably by inflation hawks.

6. U.S Treasuries: Yields should be watched today after having provided anxious results this week, U.S equity indices will continue to react to the ‘bonds’ market.

5. Nvidia: After delivering superlative results in 2023, the company has announced the release of Chat with RTX, which allows independent AI chatbot capabilities to interface with your own documents, videos, etc., providing insights from personal queries.

4. Chinese Property: Investments dropped by over 9% in 2023. China’s government faces a clash between socialistic ideology in order to help the market versus practical supply and demand realities.

3. U.K: Gross Domestic Product numbers came in with negative results yesterday for Britain, the combination of recessionary GDP and stubborn inflation is stagflation. Bank of England faces a difficult decision. Will the BoE get proactive and cut interest rates before the Federal Reserve? GBP/USD is below 1.25800 this morning.

2. Data: Stronger than expected U.S CPI statistics caused bedlam on Tuesday, but yesterday’s Retail Sales came in weaker. The ‘disappointing’ consumer spending numbers were likely welcomed by the Federal Reserve and financial institutions. Producer Price Index statistics will be published today, surprise inflation results could jostle financial markets.

1. Forex: Day traders witnessed whipsaw results early this week and should remain cautious going into this weekend. Patience will be needed as USD centric outlooks adjust to nervous shifts in behavioral sentiment.

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Big Week of Data Impetus as Behavioral Sentiment Awaits

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Big Week of Data Impetus as Behavioral Sentiment Awaits

Traders who have not been comfortable in Forex since the beginning of the year should acknowledge the coming days could offer more unpleasant impetus which is certain to affect financial institutions’ behavioral sentiment and speculative wagers. There will be plenty of U.S data including inflation numbers and consumer outlooks in the coming days.

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USD Index Five Year Chart as of 12th February 2024

A look at the USD Index above shows how the USD has moved on a correlated track with interpretation of U.S Federal Reserve sentiment via their monetary policy over the long-term. Day traders hoping to find a sudden magical wand which will lead them in the right direction should understand the USD is likely to remain choppy until a clear outlook is delivered.

The USD has climbed back to important mid-term values against many major currencies, but intriguingly after hitting important prices last week against the EUR, GBP and JPY, the USD did start to lose value again. However, short-term speculation is going to remain difficult and risk taking tactics need to be precise. This week’s U.S data may give a clearer window into the thinking of the Fed, but it also might create additional whirlwinds if the economic numbers are mixed.

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S&P 500 Index One Year Chart as of 12th February 2024

Barometers regarding risk appetite remain fascinating as the S&P 500 continues to fight upwards. As the major U.S indices begin opening today, they will start the day still seemingly with strong winds behind their backs as they fight for new highs.

And the higher values on the S&P, Dow Jones and Nasdaq were accomplished as U.S Treasury yields turned higher slightly last week, but then bond yields like the USD saw slight reversals lower as the weekend approached. Investors who believe it is inevitable yields will come down as the Federal Reserve turns more dovish regarding interest rates in the late spring will likely continue to lean heavily towards stock market infusions while seeking better returns compared to U.S Treasuries.

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Gold Three Month Chart as of 12th February 2024

Perhaps the most solid barometer for the USD remains Gold for short-term traders. The price of the precious metal is near important mid-term support levels as speculators seemingly wait for further insights. The 2020.00 USD per ounce level appears to be an important psychological juncture. Obviously, the 2000.00 USD mark is an important inflection point for perspective.

The better Gold has done, the weaker the USD has been over the mid-term. Forex day traders should keep their eyes on the value of Gold this week. Yes, speculative forces can cause sudden surges in Gold in various directions which cannot be calibrated to USD trading, but from a behavioral sentiment perspective it will be worthwhile to see where Gold is trading at the end of this week when all the U.S data on the menu has been digested.

Monday, 12th of February, China Lunar New Year – a week long banking holiday has begun in China. Data from the Asian giant has continued to be rather grim. Upon the return of China to the financial markets next week, investors will continue to ask difficult questions about Chinese government policy which is not particularly transparent.

Tuesday, 13th of February, U.S Consumer Price Index – a slew of CPI readings will be published. The monthly Core and broad reports are expected to meet last month’s results, but the year long Consumer Price Index comparison is expected to come in with a 2.9% reading, below the 3.4% gain from the previous result. Financial institutions who are geared towards a more ‘dovish’ Federal Reserve are probably hoping for inflation numbers that meet expectations or come in lower. However, if the CPI figures come in ‘hotter’ than forecast with higher outcomes, this could ignite more strength in the USD across the Forex markets.

Wednesday, 14th of February, U.K Consumer Price Index – an expected gain of 4.1% is anticipated from the broad year on year comparison. If the CPI number comes in higher, it would put the Bank of England in a more difficult spot. U.K economic data has been lackluster, but stubborn inflation remains a hurdle which seems to be keeping the BoE from becoming more proactive regarding a more dovish approach to interest rate cuts, which is needed in the eyes of many analysts. The GBP/USD will respond to this number and day traders should anticipate the price range of the currency pair to widen before and in the aftermath of this CPI release.

Thursday, 15th of February, U.K Gross Domestic Product – an outcome of minus -0.2% is expected. If the ‘growth’ number comes in with this negative estimate, it will spur on noise about recession in the United Kingdom (but this is largely known already). However, if the GDP result is weaker than the already lackluster forecast, the GBP/USD would react with volatility. The potential combination of daunting inflation and recession pressures at the same time is not a happy place. The Bank of England will have a ‘minefield’ they have to navigate ahead if stagflation continues to ebb forth. GBP/USD traders should be ready for choppy results and then brace for additional fireworks because of coming U.S data on the schedule.

Thursday, 15th of February, U.S Core Retail Sales – a negative estimate of minus -0.2% is the expectation from the broad figure, while the Core result is anticipated to show a slight gain of 0.1%. U.S consumers have proven to be a durable crowd the past handful of months, but a lot of the spending has been aided apparently by the use of credit cards. The Federal Reserve will not say so, but they would actually be content to see Retail Sales numbers come in weaker than expected. A stronger outcome would cause additional USD anxiety and perhaps another crawl upwards for the greenback. Consumer Sentiment numbers will come from the University of Michigan on Friday which will add to the analysis of U.S consumers.

Friday, 16th of February, U.S Producer Price Index – Manufacturing Index reports from the Empire State and Philly Fed readings will have been seen on Thursday and are expecting negative results. However, these PPI inflation numbers could prove to have more impact on financial markets. Expected gains of 0.1% are anticipated from the Core and broad reports. Slightly negative results would be welcomed by the Fed and financial institutions, and perhaps propel a weaker USD. Stronger than anticipated inflation data from the PPI could create more USD choppiness.

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AMT Top Ten Miscellaneous Insights for the 9th of February

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

AMT Top Ten Miscellaneous Insights for the 9th of February

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10. Super Bowl AMT Prediction: Kansas City Chiefs 27 – San Francisco 49ers 24. After winning the MVP Travis Kelce will hug Taylor Swift and announce his retirement.

9. Jazz Fusion: Please listen to the song School Days played by Stanley Clarke while delivering a supreme bass guitar riff.

8. Tech: Google has announced its Bard A.I will now be known as Gemini in a rebranding. ‘Bard’ was a rather poor name, but is Gemini much better? Let’s ask Gemini what it thinks about the Google marketing team.

7. Banking Animal Kingdom: Central Banks parroting the same rhetoric globally as they choose to be ‘prey’ instead of ‘predators’, driving financial institutions and traders batty in Forex.

6. Crypto: The NBA is being sued by investors in a Class Action Complaint in conjunction with 4.2 billion USD in losses, because of alleged fraudulent actions by Voyager Digital Holdings, claiming the NBA bears responsibility for negligent marketing via the Dallas Mavericks. https://storage.courtlistener.com/recap/gov.uscourts.flsd.661881/gov.uscourts.flsd.661881.1.0.pdf

5. Deutsche Pfandbriefbank AG: A large slump in bond values for the German bank has sparked additional fears of exposure for banks involved with the commercial real estate sector. CRE appraisals remain unrealistically high in many European and North American cities as lending risks climb.

4. Cocoa: The price for the commodity was 4055.00 USD per metric ton on the 8th of January, as of yesterday it was 5666.00, a rise in cost of 39.72% in a month. Our sweet tooth just got more expensive.

3. Data: Yesterday’s Weekly Unemployment Claims showed negative revisions upwards from the previous two weeks; another ‘hidden’ piece of data not being fully considered by traders, perhaps like the Non Farm Employment Change data last week reporting declining workweek hours.
https://www.angrymetatraders.com/post/usd-hidden-jobs-data-shows-potentially-intriguing-weakness

2. China Economy: Deflation continues to be reported via the CPI and PPI statistics. Also, value of properties for housing and commercial real estate face significant headwinds. The real estate sector including ancillary infrastructure is at least 21% of China’s total GDP.

1. Risk Appetite: U.S equity indices finished Thursday’s trading achieving apex highs. The S&P 500 is challenging the 5000.00 level. Gold is near 2033.00 USD and WTI Crude Oil is above 76.00 USD as of this writing.

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USD: Hidden Jobs Data Shows Potentially Intriguing Weakness

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

USD: Hidden Jobs Data Shows Potentially Intriguing Weakness

Forex traders like many market participants react to the ‘noise’ of U.S headline data results. The recent U.S jobs numbers published last Friday is certainly an example. The USD surged in strength on the backbone of more hiring via the Non-Farm Employment Change numbers. Also the Average Hourly Earnings beat expectations showing the cost of labor had become more expensive.

The U.S Federal Reserve stood in place last Wednesday before the jobs report. Pointing towards some troubling inflation, and mentioning the labor market was tight, the Fed refused to give a timetable regarding potential Federal Funds Rate cuts. The U.S central bank is showing more patience about coming interest rate cuts than many hoped on and had wagered.

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Gold One Year Chart as of 7th February 2024

Yet, there continues to be signs of anticipation for a weaker USD in the mid-term. The price of Gold remains within its higher elements, and U.S Treasury yields remain lower (although it must be said the past two weeks have seen an incremental move higher). And as a sign of potential inflation erosion, energy prices continue to be polite, which means the costs of logistics may continue to ease (except to say concerns about Suez Canal availability and chaos in the Red Sea are certainly risks).

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WTI Crude Oil One Year Chart as of 7th February 2024

The fact that gold remains solid in value, and energy prices remain relatively low, and that support levels in Forex via the USD continue to drift near realms seen on the 13th and 14th of December is an intriguing behavioral sentiment clue. Perhaps it is a sign large institutional players believe they know something others are not considering regarding the future direction of the USD fundamentally.

There are always risks for day traders. Having solid information which is correct and can affect values in Forex, commodities and even equities is important for speculators, but is also hard to find when there are limited resources regarding market intelligence.

U.S Jobs Numbers Headline may be Misleading

Importantly, while last week’s jobs numbers on the ‘surface’ scared many large players who believed the USD will get weaker, thus causing the significant reactions via reversals in many major currency pairs teamed against the USD; there is some evidence from the U.S jobs statistics that needs consideration which was not widely reported. It is important to read beyond the headlines.

The amount of hours worked in the U.S on a weekly basis has eroded. Added to this consideration is that the stronger hiring numbers may still have been affected from seasonal needs due to the holiday season. This sets the table for the next U.S jobs numbers as a significant report on the 8th of March, and one that will have a big impetus on Federal Reserve’s monetary policy outlook and USD.

The U.S Bureau of Labor Statistics Employment Situation News Release on the 2nd of February (https://www.bls.gov/news.release/archives/empsit_02022024.htm) reported the following:

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Perhaps it is conjecture to speculate the average workweek for employees decreasing is a telltale sign of weakening employment numbers to come, but it might prove to be a useful insight. Layoffs via U.S corporations continue to make news as companies seem to be bracing for a downturn in U.S economic health in the coming months. If the layoff theme remains noisy it will create the need for action from the Federal Reserve regarding monetary policy.

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EUR/USD One Year Chart as of 7th February 2024

What does it mean for day traders? There are absolutely no guarantees, but the major currency pairs ability to stay within their mid-December prices is a likely sign that financial institutions have analysts which are looking beyond the headline numbers from the recent U.S jobs report, and have also seen the hourly workweek data. In other words support levels in many of the major currency pairs could prove durable. There is no doubt reversals and outliers will be demonstrated, and choppy Forex conditions will happen, but perhaps the current lows in many major currency pairs will start to exhibit resilience.

Trying to time short-term moves via behavioral sentiment that is generated by statistics found ‘hidden’ away in the jobs numbers is speculative. But if traders want to consider the potential of technical support, it might be worth a consideration to think the U.S employment picture isn’t as strong as the headline ‘noise’ is projecting.

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Friday’s Forex Violence and Coming Attractions for Traders

by with No Comment AMT MarketsAssetsFeatured Highlights

Friday's Forex Violence and Coming Attractions for Traders

While the past month has continued to produce positive trends upwards for traders speculating on equities via U.S indices with record breaking values, Forex has been rather brutal for many day traders if they have remained stubborn.

Short-term trading conditions in Forex again proved violent this past Friday, as the Non-Farm Employment Change and Average Hourly Earnings reports came in stronger than anticipated and set off fireworks in the major currency pairs.

Fed Chairman Jerome Powell offered a clue to speculators paying attention last Wednesday, during the Fed’s Press Conference in which he spoke about the tight labor market. It seems likely the Federal Reserve knew the jobs data was going to be rather robust and hinted.

The Federal Reserve did continue to speak about interest rate cuts, but they certainly have not given an exact timetable when more dovish policy will begin. This has left many speculators, corporations and financial institutions nervous and the results via choppy trading conditions the past handful of weeks are proof.

USD strength the past month has caused headaches for many Forex speculators, but it needs to be said that many major currency pairs are lingering near values post-December 13th 2023, this was when the Federal Reserve made it ‘official’ that a more dovish monetary policy would develop in 2024.

Early wagers by financial institutions in December indicated they believed a March Federal Funds Rate cut would be seen, but after last Wednesday’s Fed’s FOMC Statement and Friday’s jobs numbers it seems more likely for the moment a May interest rate cut could be a legitimate target.

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WTI Crude Oil Three Month Chart as of 5th February 2024

Risks do Abound and Speculators Should Remain Cautious Near-Term

Inflation concerns via knock-on affects from logistical complications via Red Sea chaos which disrupts the Suez Canal shipping is a legitimate threat and needs to be monitored. However, the price of WTI Crude Oil traded in a remarkably stable manner last week as noise was heard from the Middle East. In early price action this morning the commodity has been polite and remains within sight of 72.00 USD per barrel. The lack of a nervous reaction in Crude Oil thus far could keep global investors calm.

This week will be limited regarding important economic data. However, there will be plenty of rhetoric offered by U.S Federal Reserve members in the coming days via conferences and interviews. Forex traders have needed to combat an array of reversals as price equilibrium has created rather tenacious price realms and this may continue near-term.

There are time periods when traders should be willing to accept that methods regarding short-term trading tactics need to be adjusted. January has shown that financial institutions were of the mindset the USD had gotten too strong. And although it appears financial institutions continue to lean towards a weaker USD outlook in the mid-term (as proven by lower moves in the USD leading up to the jobs report on Friday), the surprisingly good jobs data certainly caused the USD to bounce upwards.

Technical considerations of the USD at this moment are important, fundamental data is still coming in rather mixed, this as financial houses wait on central banks to start reacting with interest rate cuts due to lackluster economic data. It is important to note that some analysts have started to murmur the ECB and BoE may have to move first regarding interest rate cuts – if they have the courage to take this action sooner rather than later. The U.S economy has remained rather strong regarding consumer sentiment and this is causing angst among Fed observers. The U.S jobs numbers on Friday highlighted this nervousness.

Monday, 5th of February, U.S Services PMI via ISM – an outcome of 52.0 is the expected reading, which would be higher than the previous result of 50.6. If the Services number meets its estimate and doesn’t exceed the expectation, this would calm nervous financial institutions which may believe the U.S economy may be too strong for the Federal Reserve’s liking, and cause some hawkisk sentiment regarding monetary policy to linger. A weaker number from the Services PMI could help the USD selloff slightly, a stronger outcome could result in more USD buying short-term.

Tuesday, 6th of February, Australia Cash Rate and Monetary Policy Statement via RBA – no major changes are expected from the Reserve Bank of Australia. Global central banks have taken a wait and see approach as they likely remain nervous regarding the potential of inflation to remain stubborn in the mid-term. The RBA is probably going to follow the ECB, BoE and Fed’s stances from last week and remain conservative.

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EUR/USD Six Month Chart as of 5th February 2024

Wednesday, 7th of February, Germany Industrial Production – though this report is not viewed as a major economic event for traders the results should be watched. The EUR/USD has been hit by rather volatile conditions as financial institutions try to anticipate central bank moves. If the German data comes in weaker than expected (a minus -0.4% result is anticipated) this could make the EUR/USD slightly more bearish.

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Shanghai Composite Index One Year Chart as of 5th February 2024

Thursday, 8th of February, China CPI and PPI – economic data from China has not improved and foreign investors are not showing an appetite for risk. Deflation remains a concern in China, and although the official government rhetoric promised sunnier days ahead, fundamentals in real estate, manufacturing and consumer driven data offers troubled prospects. The Consumer Price Index from China is anticipated to be worse than the previous month’s outcome. The downturn in the SSE (Shanghai Composite Index) is now challenging the 2,700.00 vicinity.

Friday, 9th of February, Canada Employment Change – Canadian economic data has been lackluster and analysts have been quite critical of government policy. Having said this the USD/CAD is largely going to stay in a USD centric mode going into the weekend.

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AMT Top Ten Miscellaneous Raindrops for the 2nd of February

by with No Comment AMT MarketsAssetsFeatured Highlights

AMT Top Ten Miscellaneous Raindrops for the 2nd of February

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10. Risk Appetite: WTI Crude Oil almost serene around 74.00 USD, as bombastic rhetoric remains loud involving the Middle East.

9. South Africa: President Cyril Ramaphosa expected to announce the country’s election date when delivering the State of the Nation Address on 8th of February.

8. Tesla: Negative media coverage and an always defiant Elon Musk gravitate towards each other, share price is around 188.88 USD.

7. China: Shanghai Composite Index (SSE) hovering near 2,730 as of this moment.

6. Gold: After near-term lows a challenge of highs as USD has gotten slightly weaker.

5. Central Banks: All bark and no bite yet, as financial institutions desire interest rate cuts from Federal Reserve, European Central Bank and Bank of England.

4. India: Nifty 50 Index near 21,865 as of this writing, it has gained more than 101% over the last five years – yes, plus one-hundred and one percent.

3. Forex Reactions: Recent short-term volatility and reversals seen as expected, patience still needed as USD mid-term outlook remains weaker.

2. U.S Equities: S&P 500, Nasdaq 100 and Dow Jones 30 have produced nervous results but still near record highs, as U.S Treasury yields have edged lower this week.

1. Data: U.S Non Farm Employment Change and Average Hourly Earnings today, this as some major corporations shed employees but labor market remains rather tight. Broad markets will react to the outcomes.

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Holding the Line: Patience and Outlook via Fed and Risks

by with No Comment AMT MarketsAssetsFeatured Highlights

Holding the Line: Patience and Outlook via Fed and Risks

Traders who participated in last week’s markets and yesterday’s sessions likely feel as if the broad markets are ‘holding the line’, this as more impetus is awaited in the coming days. There are certainly a few factors weighing into current speculative dynamics. Concerns about a possible escalation in the Middle East conflict are heightened, tomorrow’s U.S Federal Reserve shadows, and ongoing quarterly corporate earnings publications are affecting behavioral sentiment.

U.S indices remain within record territories and U.S Treasury yields continued to decline yesterday. The short-term buying of U.S equity indices has stirred rumblings about the dangers of participating in a bullish marketplace, this as warnings about a possible selloff are heard. However, risk appetite remains sustained and the decline in U.S Treasury yields has helped push institutional money back into equity indices.

Day traders pursuing Forex have likely had a tougher time the past few weeks. The USD has shown an ability to strengthen and is traversing in sight of important technical price ratios – within the major currency pairs – which are traversing value realms seen around the 13th of December.

Inexperienced traders often dream of making a quick killing via profitable positions and being able to relax afterwards. However, experienced traders know the importance of having patience and not getting overly ambitious when market conditions are choppy. Financial institutions have shown a clear sign that the USD was oversold in December. Solid trading results are mostly attained through methodical approaches.

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WTI Crude Oil Five Day Chart as of 30th January 2024

Aside from the U.S central bank’s dynamics which will come tomorrow. Middle East geopolitical risks have created headlines the past few days. An attack on a Singapore flagged oil tanker last Friday caused a spike in price with WTI Crude Oil. And this past weekend’s attack on a U.S military outpost in Jordan has many people anticipating a retaliatory action. WTI Crude Oil remains in what appears to be a wait and see mode as it hovers above 76.00 USD as of this writing.

As a trader it is important to push personal bias to the side, perceptions regarding the talking points of geopolitics and social policy are interesting, but sometimes not related to the daily trading results of assets being pursued. A trader can disagree with how political events are being dealt with, but they must contend with the interpretation the market is providing regarding price. Most traders suffer from some type of bias and this should be considered when speculating.

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EUR/USD Three Month Chart as of 30th January 2024

Tuesday, 30th of January, Germany Preliminary GDP – growth numbers from Germany came in negative with a result of -0.3% today. This result will continue to put pressure on the ECB to lower their interest rate in a quicker manner, this compared the likelihood they want to mirror the Federal Reserve’s actions. The danger of being reactive instead of proactive is a widespread criticism of central banks, but the ECB sometimes appears to be the least aggressive regarding monetary policy. The ECB is likely to remain a step behind the reality of the lackluster economics data coming from the European Union.

Tuesday, 30th of January, U.S Consumer Confidence via Conference Board – recent retail sales data has shown American consumers continue to be aggressive buyers. Better than expected sales data has likely made the U.S Fed slightly nervous. If today’s Consumer Confidence data is stronger than anticipated this could create a bit of buying momentum in the USD short-term.

Wednesday, 31st of January, U.S Federal Reserves FOMC Statement and Funds Rate – the Fed meeting may result in a lot of noise with little actual results, except to drive day traders crazy with momentary volatility. The Fed is likely to continue to point to interest rate cuts, but the hoped for cut in March is probably not going to be given voice. Instead expect a rather cautious tone speaking about inflation concerns still present, and a U.S economy which is showing a rather stubborn ability to grow.

Thursday, 1st of February, U.K Bank of England Monetary Policy Report and Official Bank Rate – no change is expected to the key lending rate from the BoE. However, the central bank will likely mention it sees signs of positive movement in the U.K economy based on the better than expected PMI numbers last week. Yet, the Bank of England will probably also mention it remains concerned with inflation. Meaning the BoE will continue to potentially dance in step with the Federal Reserve.

Friday, 2nd of February, U.S Non-Farm Employment Change and Average Hourly Earnings – following in the wake of the Federal Reserve’s rhetoric which will have been seen on Wednesday, these job numbers will move the markets but may not produce their typical price action. Layoffs are starting to be seen in some large U.S tech companies, but plenty of this knowledge has already been factored into equities and Forex.

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AMT Top Ten Miscellaneous Clues for the 26th of January

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

AMT Top Ten Miscellaneous Clues for the 26th of January

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10. Sports: Australian Open Tennis Tournament Finals this weekend. And five episodes into Netflix’s Six Nations: Full Contact there has been NO mention of rugby national teams in the Southern Hemisphere. Bias?

9. Money Club: Microsoft has joined Apple with a market cap over 3 trillion USD, the only two companies in the world able to make this boast.

8. Democracy: India elections coming in April and May seem to have a predictable outcome, but the South Africa voting date has not been made official and the ANC is under pressure. U.S citizens appear set for a rematch of Biden and Trump in November.

7. Layoffs: Around 1,900 employees of Activision Blizzard and Xbox, both owned by Microsoft, will have their jobs eliminated. Microsoft spent about 68.7 billion USD to acquire Activision Blizzard – a deal that was finalized in October of 2023.

6. Nervous: Bitcoin still battling the 40,000.00 USD ratio. Binance Coin has fallen below 300.00 USD, BNB/USD traded near 200.00 USD in the middle of October.

5. Behavioral Sentiment: Gold remains near 2020.00 USD, U.S Treasury yields are in sight of three month lows, but energy prices have ticked upwards this week with WTI Crude Oil near 77.00 USD.

4. Forex Caution Sign: Day traders should be braced for price velocity today. Is the USD going to become weaker going into the weekend?

3. U.S Federal Reserve: FOMC Statement will be on the 31st of January. Yesterday’s GDP numbers came in stronger than anticipated, fueled by robust consumer spending. However the GDP Price Index results were well below their expectations. Some folks may be dreaming about a rate cut in March, but there is still plenty of data ahead.

2. Stock Indices: The S&P 500, Dow Jones 30 and Nasdaq 100 are within record heights. Japan’s Nikkei 225 is challenging values not traversed since early 1990. The values of these indices may be dizzying, but the trend has been hard to bet against.

1. Inflation: Core Personal Consumption Expenditures (PCE) Index reading is anticipating a 0.2% gain today. Last month’s outcome was 0.1%. The U.S Federal Reserve monitors this particular report closely. Financial institutions will react and any surprises will become a catalyst in the broad markets.

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Anonymous Kingdom: Bitcoin’s Lack of Transparency is Supreme

by with No Comment AMT MarketsCryptocurrencies & Digital AssetsFeatured Highlights

Anonymous Kingdom: Bitcoin's Lack of Transparency is Supreme

Bitcoin has fallen below the 40,000.00 USD price level today, and after penetrating the depth of 39,500.00 USD has shown additional velocity lower. Bitcoin is now testing support near the 38,850.00 ratio, a value it last tested on the 2nd of December.

Influencers will likely urge their fanbases to look at six-month charts to understand Bitcoin is still within the upper levels of its price range, this because a look at a three-month chart isn’t as cheerful. The speculative asset remains a dangerous place for day traders to participate who do not have legitimate insights regarding Bitcoin.

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BTC/USD Six Month Chart as of 23rd January 2024

The question that some are likely starting to ask is what happened to the bullish rush in Bitcoin that was evangelized as a source of inspiration when the U.S Bitcoin ETFs materialized? FOMO (fear of missing out) again became an ‘advert’ for Bitcoin. True patience is needed when investing in financial assets, but day traders aren’t investing they are speculating and BTC/USD is likely costing them plenty of money.

It has been publicized that BlackRock’s spot Bitcoin ETF now holds over 1 billion USD in funds. However, while BlackRock and other ETFs have added to their assets under management of Bitcoin, what are short positions within the ETFs regarding size? This number is elusive, but the ability to sell ETF ‘share’ value within the new Bitcoin funds being offered is said to exist.

Bitcoin’s open interest numbers within the CME’s future contracts was nearly 26,669 positions on the 11th of January, yesterday’s reporting via the Chicago Mercantile Exchange was 22,250 open positions. While day traders may be speculating on the price of BTC/USD via their brokers’ trading platforms, they have to understand that their wagers are not affecting the real market price. The big players within the Bitcoin market do not operate on brokerage platforms which are merely offering CFD positions. The large traders are using cryptocurrency exchanges, futures and options via the CME, and now ETF positions.

Unless a trader is actively selling Bitcoin on a selected cryptocurrency exchange – and likely being asked to open a margin account – and thus opening the door to leverage and volatility, which it can be argued is designed to knock you out of the positions. You are going to find it difficult to actually sell ‘physical’ Bitcoin via short positions that are ‘manipulating’ the cash/spot market.

Bitcoin is a playground for sophisticated traders with plenty of cash to speculate and will continue to produce a world of extreme price volatility. On the 11th of January the price of Bitcoin jumped towards the 49,000.00 mark before declining. Bitcoin’s high early this morning was around the 40,150.00 ratio before stumbling the past handful of hours. Note, that open interest was at its highest on the 11th of January via CME futures trading information.

If you want to speculate (bet) on the value of Bitcoin as a day trader you should understand that you are participating in a marketplace that still doesn’t have the best of transparency. Yes, in most assets day traders are always competing against complex dynamics in which they have no control. However, speculating on BTC/USD is still being done almost blindfolded because of the lack of insights that is part of Bitcoin’s anonymous allure that many of its proponents love. We are still a distance away from transparency within the world of Bitcoin.

If traders can get access to volumes data – and the size of long and short positions being placed within the crypto exchanges they are using that helps. But because Bitcoin trading is still unregulated, and since there are many crypto exchanges operating you will only be getting small bits of information. The lack of information should worry day traders and serve as a caution sign.

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Forex Volatility as Central Banks, GDP, U.S Equities Shadow

by with No Comment AMT MarketsAssetsFeatured Highlights

Forex Volatility as Central Banks, GDP, U.S Equities Shadow

Perhaps it is good that today will see a lack of important economic data which will affect the markets. It might give a chance for day traders to relax and to gauge the thinking of financial institutions and investors before Central Banks, and important growth and inflation numbers shift behavioral sentiment later this week. While Forex has remained a minefield, U.S equity indices have soared to record heights. More volatility will come.

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Shanghai Composite Index Five Year Chart as of 22nd January 2024

Risk assessment is always critical, it needs to be mentioned the Shanghai Composite Index is again facing severe selling pressure. This is a direct result of foreign investors losing faith in China’s economic policy and political maneuverings. The slump in Chinese equities is also hitting the Hang Seng Index in Hong Kong badly. Deflation is a legitimate fear in China. The dual consequences of a failing housing sector and crumbling equity values is harming Chinese citizens.

While the strong selloff in Chinese equities would have caused a massive amount of reaction in the global markets a few years ago, the ability to shift assets elsewhere by foreign investors who were active in China has likely reduced potential knock on effects in other global equity markets. It must also be pointed out that China continues to sit on a massive amount of USD holdings. China is a large investor in Africa and their attempt to steer influence there remains abundantly clear.

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Nifty 50 Index Five Year Chart as of 22nd January 2024

India has directly benefited from the outflow of investments from China. A look at the Nifty 50 Index shows the upwards momentum India’s equity market has enjoyed as it has started to attract more direct foreign investment. The ability of the India stock market to go up while China struggles is a barometer worth studying. Outflow vs. inflow.

Monday, 22nd of January, U.S Conference Board’s Leading Index – the reading is not at the forefront of consideration for investors, they will be watching the results of U.S Treasury yields and stock indices more closely than this report.

Tuesday, 23rd of January, Bank of Japan Monetary Policy Statement and Outlook Report – no major change is expected from the BoJ quite yet. The USD/JPY has been volatile and provided a solid trend upwards since the start of January. Day traders looking for a reversal lower to develop should be extremely cautious. Data from Japan has been mixed and the BoJ is likely to remain conservative. The weaker JPY helps exports from Japan it must be remembered, but it also may factor into inflation creeping into the Japanese economy.

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NZD/USD One Month Chart as of 22nd January 2024

Tuesday, 23rd of January, New Zealand Consumer Price Index – the inflation report is expecting a result of 0.5%, which would be below the previous result of 1.8%. The NZD/USD has taken a bearish dive since late December. Like all major currencies the New Zealand Dollar remains USD centric. Volatility in the NZD/USD may occur via the inflation numbers from New Zealand, but like the USD/JPY it may find its biggest impetus coming from afar – U.S data and the Federal Reserve outlook.

Wednesday, 24th of January, E.U and U.K Flash Manufacturing and Services PMI reports – Germany and France are anticipating slightly better Manufacturing Purchasing Managers’ Index numbers. Services numbers are expected to be slightly weaker from Germany. Solid results from these combined publications could help the EUR/USD create a bit of bullish momentum.

The U.K numbers via their Manufacturing PMI is expected to be slightly better than the previous outcome, but the Services number a bit worse. Economic data from Britain remains mixed to lackluster. Higher inflation numbers last week did the Bank of England no favors. The GBP/USD will be affected briefly by the results, but trading in the Forex pair is likely to remain geared towards thoughts about U.S data coming this Thursday and Friday.

Wednesday, 24th of January, Bank of Canada Rate Statement and Monetary Policy Report – the key lending rate from the BoC is expected to remain unchanged. However, Canadian economic numbers have been problematic, and while the BoC may want to wait for the U.S Federal Reserve to move first regarding interest rates, critics of the BoC are becoming louder. The USD/CAD will react to the Bank of Canada’s rhetoric, but unless there is a major surprise the currency pair will remain heavily USD centric.

Thursday, 25th of January, European Central Bank Main Refinancing Rate and Monetary Policy Statement – the ECB is expected to provide no major changes. The 4.50% interest rate is anticipated to stay in place. The ECB will likely ‘sound’ a calm tone and say while improvements are being seen in the E.U, that areas of difficulty remain but are understood and being managed.

Thursday, 25th of January, U.S Advance Gross Domestic Product – the key growth number from the U.S is anticipated to show a gain of 2.0%. This number will get a reaction in Forex, equities and bonds. The Federal Reserve’s FOMC meeting is next week and this GDP result will factor into their monetary policy rhetoric. Because it is an election year in the U.S, this number will also get an additional ‘sounding board’. Day traders should be careful before and after the noise caused by this growth report.

Friday, 26th of January, U.S Core Personal Consumption Expenditures – the vital inflation number carries an estimated gain of 0.2% before its release. As much as the Fed watches the GDP number, the inflation result via the Core PCE is a huge component of the U.S central bank’s thinking. The USD will react to this report and Forex traders should brace for a reaction from financial institutions. If the number is weaker than expected the USD could find selling momentum, if the number is stronger more USD strength could be seen. Folks looking at the GDP and Core PCE reports should also look for potential revisions to previous months results, which could cause another wave of volatility in the markets if they are significant.

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AMT Top Ten Miscellaneous Flakes for 19th of January 2024

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

AMT Top Ten Miscellaneous Flakes for 19th of January 2024

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10. Music: Come On, Come Over performed by Jaco Pastorius. The bass playing on this song is magnificent.

9. Cybersecurity: Prospect of quantum computing is making Central Banks nervous, quantum development will impact blockchain and make current payment systems vulnerable and perhaps obsolete. Post-quantum cryptography development is vital.

8. Frigid Weather: Tesla owners have dealt with battery power failures as winter temperatures have plummeted in Chicagoland and elsewhere. EV energy solutions need to improve.

7. China: Over the past 11 months FDI (foreign direct investment) has dropped more than 10% in the nation, an estimated short fall of 145.51 billion USD. China’s Foreign Direct Investment release has seemingly been pushed off to next week. Shanghai Composite (SSE) near 2832.28.

6. Energy Sector: WTI Crude Oil still priced politely as ‘interactions’ with Houthis flare. Natural Gas values remain near lows while North America suffers from a deep freeze.

5. Risk Assessment: Iran and Pakistan, although expressing ‘brotherly love’ for each other, have exchanged missiles across their respective border aimed at extremists.

4. U.S Treasuries: Inversion has almost ended completely, 5-Year Notes up to 30-Year Bonds yields have returned to ‘norms’.

3. Gold: Price of the precious metal near 2027.00 USD having bounced higher after challenging the 2000.00 vicinity on Wednesday.

2. Data: Consumer Sentiment reading via University of Michigan on the schedule today, this could provide impetus to markets that appear to be waiting for the next big push.

1. FX Volatility: USD strength has pushed the greenback towards important mid-term resistance in Forex as many day traders are likely still fighting the trend.