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Central Banks Noise: Holiday Trading Put on Hold For a Bit

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Central Banks Noise: Holiday Trading Put on Hold For a Bit

As suspected the Federal Reserve sounded more cautious than many analysts expected yesterday. While the Fed did cut the Federal Funds Rate by 0.25 to 4.50%, they essentially opened the door to allowing the current borrowing rate to simmer over the mid-term. Yes, they did suggest they would like to lower interest rates, but it sounded more like wishful thinking. In response to the more aggressive rhetoric (hawkish) from the Federal Reserve financial markets became volatile in equities, Forex and bonds.

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GBP/USD Three Month Chart as of 19th December 2024

The show is not over yet ladies and gentlemen, this morning the Bank of Japan repeated their typical historic stance of proving cautious, and later today the Bank of England will step onto centerstage with their Monetary Policy Summary and Official Bank Rate. And here is where things may get more odd, the BoE in many circles is not expected to cut its interest rate even though the U.K economy has been struggling and continues to publish lackluster statistics. The current borrowing rate via the Bank of England stands at 4.75%. Though the BoE should consider a rate cut of 0.25 certainly, and may even have enough reasons to decrease by 0.50, they may do absolutely nothing and that would be a mistake.

If the BoE decides to remain overtly guarded this will cause some bedlam with the GBP/USD. Large commercial players may choose to punish the GBP/USD as they consider their cash forward positions. Retail traders should be extremely careful if they choose to speculate on the British Pound in the coming hours. Not to say the GBP/USD is going to have a Liz Truss like moment from September 2022 today, but Forex traders have been selling the currency pair based on nervous outlooks over the past three months. If the Bank of England looks at the incoming headlights via the GBP/USD bearish trend and does not move, they might get run over by the truck.

Big and small traders certainly have the approaching holiday season on their minds and they might be getting things in order to take a break for the next couple of weeks, but financial markets because of the central banks actions yesterday and today will not allow for comfortable thoughts. And this is important, because some financial institutions are shuttering for the long holiday starting this Friday, they may be more prone to being quite cautious going into a period where trading volumes will light and assets will be exposed to the potential of sudden gyrations caused by large positions being placed in unbalanced markets. In other words, equities, Forex and bonds will be dangerous today and tomorrow. Behavioral sentiment will be the power.

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Interest Rate Cuts and Cautious USD Centric Gusts in Forex

by with No Comment AssetsBehavioral SentimentFeatured Highlights

Interest Rate Cuts and Cautious USD Centric Gusts in Forex

U.K inflation data this morning came in well below estimates, which almost assures the Bank of England will cut their Official Bank Rate on the 7th of November by at least 0.25 basis points. Tomorrow the European Central Bank will announce its Main Refinancing Rate and it is widely anticipated a 0.25 cut will be made official.

The downturns in the EUR/USD and GBP/USD are easy to see via three month technical charts, but both pairs remain above lows seen over the mid-term. However, the choppy and consistent selling in both currency pairs the past few weeks have likely caused pain for any day trader who has remained stubbornly bullish.

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EUR/USD Three Month Chart as of 16th October 2024

Questions surrounding the Federal Reserve remain murky and this is creating USD strength and cautious selling in other currencies. After a rather dovish sounding round of rhetoric from Jerome Powell and a 0.50% basis point decrease in mid-September, financial institutions clearly have become more guarded about the ability of the Fed to remain aggressively dovish. Will the Fed will cut by another 0.25 on the 7th of November and then say they believe they are done being dovish until additional data backs up their stance? Is there a capability the Fed will still cut the Federal Funds Rate by 0.50 over the next handful of month as once envisioned?

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GBP/USD Three Month Chart as of 16th October 2024

However, there is a chance the Fed will not cut in November and some analysts have banged their drums regarding this idea. But the Producer Price Index results last Friday did show that inflation remains under control. So I hold to the notion the Fed will cut by another 0.25 in November. Let’s see.

On Thursday the 10th of October the U.S Consumer Price Index statistics were slightly hotter than hoped for and this certainly caused some of the USD centric storms now thrashing financial institutions and day traders. It should also be mentioned that on the 4th of October the Non-Farm Employment Change numbers came in better than expected. But revisions lower in the jobs data the past handful of months needs to be remembered, and, yes, there will be another jobs report on the 1st of November. Which will be followed on the 5th by this little thing known as the U.S Presidential Election. So caution will be a solid instrument for day traders and possibly financial institutions over the next three weeks. The stronger move by the USD since the end of September has caught many folks off guard.

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Gold Three Month Chart as of 16 October 2024

Gold is trading near record high levels this morning, but intriguingly WTI Crude Oil has calmed down and is challenging near-term lows. U.S Treasury yields have come down slightly to start this week. The point being that while Forex and gold have seen volatility because of interest rates uncertainty, risk taking actually appears rather solid. Yesterday did see selling in U.S equity indices, but there is no denying U.S stocks remain within sight of ultra-highs. And I might be about to sound contradictory soon, and my own personal bias needs to be carefully given consideration by myself and you the reader. Because while I feel rather comfortable about the higher values in the major U.S indices, I do not feel the same way about Chinese equities currently.

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Shanghai Composite Index (SSE) Three Month Chart as of 16th October 2024

The Shanghai Composite Index has traded a little lower again, but this follows a massive swing upwards after Chinese stimulus intervention. But the U.S equity indices and the Chinese markets are not correlated. Perhaps mentioning the Shanghai Composite Index here is wrong, but the stimulus the Chinese government provided may prove to be window dressing on a storefront that suffers from poor economic infrastructure. Day traders in Asia and elsewhere who are betting on upside in Chinese equities need to be very careful, in fact they should be quite suspicious. Economic data from China to start this week has remained lackluster. On Friday GDP, Industrial Production, Retail Sales and New Home Prices data will come from China.

Major currencies which did very well against the USD since July have struggled the past few weeks as clouds have emerged regarding U.S interest rate outlooks. However, at some point day traders and financial institutions may believe the USD has sold off too much during this wave of caution. The JPY, GBP, and EUR have all lost value during this time. As always day traders need to remember they will find it hard to pick the correct time a strong reversal starts to take place. And it should be remembered because of the risk events lined up Forex volatility may rage a while longer. Certainly the outcome of the U.S election will be a factor in the days ahead and may create sideways trading outcomes in many assets until a winner is known.

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USD/JPY Three Month Chart as of 16th October 2024

But the global markets will remain open and trade. While shouts of danger should be listened to and given heed, tomorrow’s ECB meeting and outcome will be a good start to the parade. If the ECB plays the expected song and cuts the Main Refinancing Rate by 0.25 this will prove interesting, because financial institutions have already priced in the rate cut in most cases and they will wonder if their outlooks regarding the Fed and BoE are correct. The U.S will release data tomorrow with Retail Sales and weekly Unemployment Claims. On Friday housing sector results will come from the U.S also. These reports will provide USD impetus into the markets as the near-term is considered and wagered upon.

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Reactions and Risks as Trading Clarity Remains Hard to Grasp

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Reactions and Risks as Trading Clarity Remains Hard to Grasp

While many U.S government officials try to shrug off the downgrade of U.S Treasuries by Fitch Ratings last week, a warning shot has been fired regarding U.S spending and the nation’s growing deficit. Janet Yellen and others may believe the downgrade should not have happened, but the prospect that the U.S golden goose is going to stop eventually producing enough eggs is a realistic viewpoint from Fitch. Risk adverse trading on the news was seemingly sparked from the U.S Treasuries downgrade, while many prominent figures including Warren Buffet have claimed they are not worried. However, one thing that the downgrade did was certainly create more clouds for financial institutions which have already been suffering from a lack of clarity the past three weeks.

U.S economic policy remains troubling regarding its spending, and while the government believes its bonds will remain the best in the world for the foreseeable future, it would certainly help matters if responsible ‘adults’ would be allowed a voice regarding stimulus, expenditures and debt ceiling concerns. The U.S has been warned, but with a major presidential campaign approaching on the horizon, more promises to the U.S public will likely carry greater long-term costs.

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Gold One Week Chart as of 8th August 2023

While the USD did get stronger across Forex and gold finished last week near lows, some major currencies finished Friday with slight reversals higher against the USD before going into the weekend, based on the weaker than anticipated Non-Farm Employment Change outcome. However, Average Hourly Earnings came in slightly higher. The rise in wages for employees wasn’t expected, but the gains via the inflation number may not have been considered significant enough to cause a panic.

Day traders trying to navigate through the news of the ratings downgrade and the mixed jobs numbers from the U.S may have gotten ripped apart from the volatility late last week. Forex brokers likely had a good week if the majority of their speculators were ‘B’ book – virtual – traders. Survivors of last week’s dynamic price action should be aware that financial institutions do not have the best of outlooks for global central banks. This week’s coming data may help a bit, but trading could also remain rather dangerous and churn volatility.

Global Outside Influence to Give Attention:

Although Niger may seem like a world far away for most day traders, they should keep an eye on the developments of the African nation. A military coup has gotten the attention of global powers and there are threats of military intervention rattling. France, the U.S and Nigeria and other ‘Western’ leaning nations have a stake in the Niger drama, on the other side is Russia and its Wagner affiliated mercenaries. The potential for a war to to start in this landlocked northern African nation appears to be growing. A conflict in Niger could include a wide range of competing sides and create loud rhetoric and hyperbole. It could also cause uncomfortable feelings at the BRICS summit scheduled to begin on the 22nd of August in Johannesburg, South Africa.

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GBP/USD One Month Chart as of 8th August 2023

Monday, 7th of July, U.K Halifax Home Price Index – this data is expected to remain rather stable, but the past three results have been negative. Mortgages are getting expensive in the U.K and the pressure added from higher interest rates is not helping. The GBP/USD could react briefly to this outcome.

Monday, 7th of July, E.U Sentix Investor Confidence – the reading is anticipated to be worse than last month’s outcome regarding investor outlook. The past three months have been negative. The E.U is certainly facing recessionary pressure. Oddly enough, a poor outcome could spur on the belief the ECB may have to become less aggressive regarding their higher interest rates. The EUR/USD may see a flurry of reactions from this report.

Tuesday, 8th of July, China Trade Balance – the results will get plenty of attention because recent economic data from the nation has been troubling. Export demand is important for China’s economy.

Tuesday, 8th of July, Germany Final Consumer Price Index – the result is expected to match the forecast of a 0.3% gain. This inflation report will be watched by EUR/USD, but if expectations are met this could create rather consolidated trading until Thursday for the currency pair.

Wednesday, 9th of July, China CPI – the inflation data from the nation will be watched by global investors. Recent statistics from China have signaled concerns about ‘deflation’. An outcome of minus -0.5% is expected. Economic issues are shadowing China, this as it remains active in global affairs.

Last week Argentina announced China helped facilitate a ‘bridge loan’ for the South American nation so it could make a repayment to the IMF. Rising economic concerns in China could start to squeeze its ‘cash power’ as it tries to gain influence globally by pumping Yuan (CNY) into international finance. China has certainly been bold and is playing a ‘long game’, because its choice of Argentina as a nation to help can certainly not expect to produce short-term financial gains.

Thursday, 10th of July, U.S CPI – Consumer Price Index results from the States will cause potentially dynamic broad market movement. Inflation is expected to match last month’s rise of 0.2% via the broad and core numbers. However, traders should note that some analysts have voiced concerns rising energy prices the past month will hit the inflation numbers, if this occurs it could spark a volatile USD. Higher Crude Oil prices combined with a streak of U.S hot weather may create an intriguing outcome. Risk management should be used by day traders who are wagering in the markets as the CPI readings are released.

Friday, 11th of July, U.K GDP – the Gross Domestic Product numbers will be important immediately for the GBP/USD. Although last month’s outcome was slightly stronger than anticipated it was still negative with a minus -0.1% reading. The growth number this time around is expected to gain 0.2% per the monthly report.

Friday, 11th of July, U.S Producer Price Index – economic numbers from the States have been mixed recently. These inflation numbers are expected to show a slight rise, if the outcome meets expectations – the broad markets may remain calm. However, if inflation is stronger than expected, the result could set off fireworks if the outcome sets off fears about the U.S Fed maintaining it hawkish rhetoric.

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Market Trading Risks: Speculative, Anxious Impatient Results

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Market Trading Risks: Speculative, Anxious Impatient Results

Monday’s trading provided a solid oversight for day traders to observe market conditions in commodities, Forex and equities. Financial institutions appear to be leaning towards a belief the U.S Federal Reserve will have to become more dovish, but financial institutions and other large players are worried about shadows being caused by inflation concerns and timeframes which are likely sparking nervous wagers.

Via the commodities, results saw Gold come down from highs on Friday which approached the 2,380.00 USD perch, and drop to lows around 2333.00 yesterday. The precious metal remains within sight of record values, this as questions persist about USD direction, and speculative forces bet. WTI Crude Oil meanwhile climbed from a selloff late Friday and into yesterday’s opening while challenging the 77.75 USD vicinity, and as of early Tuesday is now over the 79.00 mark again.

Also within the volatile world of commodities it needs to be mentioned that Cocoa which regained a portion of its higher price values last week and finished Friday above 9,000.0 USD per metric ton, fell swiftly in yesterday’s trading session and is now traversing 7,357.0 USD. Cocoa has enjoyed a spectacularly wide ride of maneuvering via market forces. The commodity is still valued within loftier heights when compared to its historical averages, and demonstrates the speed and danger (and opportunity) of price velocity.

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Cocoa Three Month Chart on the 14th of May 2024

Further signs of risk appetite and fragile notions are being exhibited via U.S equity indices, which produced sideways price action yesterday as important economic data awaits and will certainly churn short-term and mid-term perspectives. The S&P 500 is again within sight of record levels, while investors of it and the Dow Jones 30 and Nasdaq 100 all brace for this week’s data which will affect their risk outlooks.

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S&P 500 Index Three Month Chart on the 14th of May 2024

Monday, 13th of May, New Zealand Inflation Expectations – yesterday’s quarterly result came in slightly below the previous report. The decrease of inflation concerns likely helped the NZD/USD spark Monday’s climb above 0.60300 briefly. This morning’s early trading is seeing sideways action as U.S inflation reports are anticipated and the currency pair ebbs around 0.60180.

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GBP/USD Three Month Chart on the 14th of May 2024

Tuesday, 14th of May, U.K Average Earnings Index, a gain of 5.7% has just been posted. This result will make GBP/USD traders nervous because it highlights that inflation remains sticky in Britain. While last week’s GDP numbers from the U.K showed an improvement, the growth certainly was not spectacular. The range of the GBP/USD remains choppy and bullish day traders targeting higher ratios on the belief the currency pair remains in oversold territory need to consider their timeframes and bias. While the 1.26000 may look like a logical target, it will take weaker U.S inflation and USD centric price action to get there.

Tuesday, 14th of May, U.S Core Producer Price Index – last month’s core report matched expectations. However, the PPI numbers occasionally spell trouble in Forex. Higher inflation results from the U.S would certainly kickstart volatility for all major currency pairs today.

Wednesday, 15th of May, U.S Consumer Price Index – this reading could prove to be the prime mover for financial assets this week because of its potential affect on behavioral sentiment. The Federal Reserve watches this number because of the influence it has on the American public. Forex will react to this report and if it is weaker than anticipated this would create weaker USD centric price action. The U.S will also report Retail Sales and the Empire State Manufacturing Index statistics on Wednesday.

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USD/JPY Three Month Chart on the 14th of May 2024

Thursday, 16th of May, Japan Preliminary Gross Domestic Product – last month’s report came in with a gain of 0.1%. This GDP data carries an expectation of minus -0.4%. Traders who like fundamentals should pay attention to revisions within the statistical pages. The Bank of Japan remains in a curious and suspicious predicament. After two interventions, the USD/JPY has climbed incrementally once again. The BoJ is certainly keeping their eyes on the USD/JPY and know financial institutions are still wagering against the Japanese Yen.

Day traders should be extremely cautious with the USD/JPY because the BoJ has the ability to strike with a massive blow when not expected. Risk management is essential for speculators wagering on this currency pair. Evidence of speculative interest in the USD/JPY correlates to the notion that while the USD has been weaker against many major currencies recently, the Japanese Yen remains within a weaker and elevated price range.

Friday, 17th of May, China Industrial Production and Retail Sales – economic dark clouds continue to cascade on Asia’s largest economy. The industrial numbers will be watched by investors certainly, but the overall health of Chinese consumers will likely be the focal point. The USD/CNY remains within bullish terrain, but the Shanghai Stock Exchange’s SSE Index has done well since its lows in the first week of February.
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Cautious Trading as Key Data and Outlooks Await Impetus

by with No Comment AMT MarketsAssetsFeatured Highlights

Cautious Trading as Key Data and Outlooks Await Impetus

The start of trading this week could prove to be slightly adventurous for speculators as financial institutions return to the markets and start to take positions for their clients. Having survived the past two and a half weeks of holiday season trading, market action will now focus on immediate, mid and long-term goals and outlooks depending on time frames and targets. Slightly nervous trading was on display last week, but some traders may believe their is plenty of room for more optimism and may be suspicious of the results delivered.

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Gold Five Day Chart as of 8th of January 2024

Day traders should look at some barometers before they participate in the near-term. Gold has come off highs seen late last week, but remains within the higher elements of its six month price range. Its selloff from apex values last week perhaps correlates to U.S equities and USD turbulence which has also been experienced.

Last Friday’s reaction to the U.S jobs numbers was fascinating. The numbers delivered an initial shock to folks who wanted to react quickly. Hiring the last month increased more than expected, which might have caused the momentary bullish surge in the USD. Only to be confronted swiftly by further investigation of the jobs data which showed previous months statistics had been revised downwards. This acknowledgement set off selling of the USD and technical whipsaw results.

Day traders participating in Forex this past Friday likely experienced a range of emotions. If the market correlations are correct regarding the USD and the reactions seen, trading in gold also seemed to mirror the price action. Interestingly, gold touched a low of nearly 2024.00 USD on Friday in the wake of the jobs report, surged higher to around 2064.00 and then reversed lower again.

The notion that gold is trading within sight of Friday’s lows is interesting for both the precious metal and trying to understand where USD sentiment will lean early this week.

Behavioral sentiment remains rather optimistic, however nervous headlines during the holiday season may have caused cautious shadows to grow darker, particularly as light trading volumes affected results. Today and tomorrow will prove interesting in the broad markets, this as financial institutions return in full and as they brace for U.S inflation numbers later this week.

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S&P 500 One Month Chart as of 8th of January 2024

Nervous short term trading is likely today and tomorrow as price equilibrium is sought. U.S equity indices have backed away slightly from their flirtations with all-time highs, but even as selling developed the past week highs are still in sight and are likely still being dreamed about by many institutions. U.S Treasury yields will also be a good indicator for Forex traders early this week regarding how comfortable financial institutions are with their current outlooks.

Monday, 8th of January, Germany Factory Orders – a slight gain of 0.3% was reported today, which was below the 1.1% expectation. The German economy is starting to show signs of economic growth, but has major hurdles to still climb. The lackluster German numbers may keep the ECB in a rather neutral stance for the mid-term. Which might help a bullish EUR/USD outlook if the U.S Fed is seen as the first major central bank which will have to cut interest rates.

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AUD/USD Three Month Chart as of 8th January 2024

Tuesday, 9th of January, Australia Retail Sales – the anticipated climb of 1.2% is significantly higher than the negative -0.3% result from last month. A good outcome via the Retail Sales could help the Australian Dollar reignite some positive momentum. CPI data will come from Australia on Wednesday, which will certainly affect the AUD/USD too.

Wednesday, 10th of January, U.S Ten-Year Bond Auction – though day traders may not be too involved regarding the sale of U.S Treasuries, the results from the auction will have an affect on Forex. U.S Treasury yields should be monitored.

Thursday, 11th of January, U.S Consumer Price Index – a slew of CPI results will get the attention of financial institutions. The inflation data is expected to show a slight decrease in the Core CPI result, but show a slight gain in the broad number. This will likely be the most heavily traded day since the third week of December. There will be a reaction from the inflation reports. If the numbers come in around the estimates this may help the bearish mid-term outlooks for the USD. If the results are shockingly stronger, the USD would turn bullish. Day traders need to be careful in the midst of the Consumer Price Index publications because volatility is expected.

Friday, 12th of January, China CPI – a decrease is expected from the Asian giant. Deflationary concerns are shadowing China’s economy. The expected number of minus -0.4% would actually be an improvement compared to the last reading which was minus -0.5%. The USD/CNY has been rumored to have been experiencing some ‘hands on’ management from China. Investors continue to be nervous about China’s economic outlook and would like to see signs of improvement.

Friday, 12th of January, U.K Gross Domestic Product – a gain of 0.2% is being anticipated. Any growth from the U.K GDP would be welcomed considering the recessionary data which has been lingering. The GBP/USD will react to the results and bullish momentum in the currency pair could be sparked by a better than anticipated number.

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Forex Calm After the Storm? Volatility and Coming Holidays

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Forex Calm After the Storm? Volatility and Coming Holidays

The weakness of the USD was anticipated last week, this as the Federal Reserve essentially admitted its aggressive interest rate hikes policy has come to an end. While Fed Chairman Jerome Powell tried to sound neutral, most financial institutions reacted to the FOMC Statement and the Fed’s Press Conference last Wednesday with a rather demonstrative amount of USD selling, largely showing they were prepared to react.

The EUR, GBP and JPY all gained, and many other currencies added value against the greenback too. Gold flourished upwards and even WTI Crude Oil came off its lows. However, after producing strong gains late Wednesday and into Thursday, gold and major Forex pairs did reverse slightly lower on Friday as the USD gained some footing.

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Gold Five Day Chart as of 17th December 2023

Risk appetite likely has enough positive behavioral sentiment influence to continue its desire for dynamic buying on U.S indices. The Dow Jones Industrials will start Monday at record heights, the S&P 500 and Nasdaq Composite are approaching one year highs.

Yes, potential headwinds can develop, so day traders should not bet blindly on bullish gyrations to mount without reversals being expected too. As the GBP and EUR gave back some of their gains on Friday, financial institutions may have been reacting to the notion price velocity higher had been too robust in the near-term. Speculators received another reminder that one way trends tend to meet with reversals that can still cause harm.

Risk adverse traders who have their eyes on global affairs should monitor the situation in the Red and Arabian Seas. Houthi extremists continue to fire at international ships sailing in the areas, and this may generate a reaction at some point from allied navies which are supposed to protect vessels and commerce. If the U.S Navy reacts to the Houthis in a strong manner this could deliver a cold short-term shiver into markets.

Speculators also need to understand this is the last ‘full’ week of trading before the Christmas and New Year holidays, which can cause a massive decline in volumes. This Thursday’s trading will begin to decrease from norms, and Friday’s price action will likely be affected by offices around the world starting to shutter as employees disappear for extended vacations. Day traders who want to participate in Forex, commodities, and equities via CFDs should be prepared for the emergence of quiet markets the end of this week with occasional volatility disrupting technical charts.

However, this Monday and Tuesday will pose questions regarding possible reactions to the weaker USD which has emerged, and U.S equity indices showing signs of speculative zeal. U.S Treasury yields continued to trend lower last week, and U.S bonds should be watched early to see if market participants continue their optimistic paces, or show signs of becoming more passive as the holidays approach. Traders with strong convictions regarding directions may feel inclined to remain active throughout this week and cannot be blamed, but some caution should be practiced.

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EUR/USD Five Day Chart as of 17th December 2023

Monday, 18th of December, Germany ifo Business Climate – the reading is expected to show a slight improvement over the last month. EUR/USD traders may believe they should react to the results from this report, but the EUR is likely to stay within a USD centric mode driven by existing outlooks. The ability of the EUR/USD to hit the 1.10000 level late last week confirmed positive mid-term bullish outlook. The reversal lower on Friday may ignite speculative buying positions early this week, but day-traders may want to be conservative.

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USD/JPY One Month Chart as of 17th December 2023

Tuesday, 19th of December, Bank of Japan Monetary Policy Statement and Press Conference – the BoJ is not expected to raise their interest rates quite yet. However the end of the BoJ’s negative monetary policy may be coming to an end in 2024. The BoJ bet on the notion that inflation would come down eventually, even it maintained a negative interest rate policy – this seems to have been proven correct. The USD/JPY has reacted the past month with a rather incremental decline. Perhaps Japanese financial institutions have been positioning for a stronger JPY over the mid-term. The USD/JPY trajectory lower remains intriguing for speculators.

Wednesday, 20th of December, U.K Consumer Price Index – the BoE sounded more dovish than many folks expected they would this past Thursday. Inflation numbers coming this week should be watched. The British economy remains lackluster, but sounds about ‘weaker’ inflation have been heard. The data from the CPI is expected to be slightly lower than the previous month. The GBP/USD could react to this report. The British Pound has delivered upwards momentum since late October. Traders should be careful regarding potential short-term reactions from the GBP/USD, and understand Forex volumes may start to decrease on Thursday and Friday which could affect results.

Thursday, 21st of December, U.S Final Gross Domestic Product – growth in the U.S has been better than most anticipated. While many analysts are still predicting a slowdown, the GDP number is expected to show a 5.2% gain. The inflation report via the GDP Price Index is anticipated to be 3.6%. While the broad markets typically would react to these statistics in a strong fashion, trading might be somewhat muted as financial institutions begin to focus more on the coming holidays.

Friday, 22nd of December, Canada GDP – a slight gain of 0.2% is expected regarding the growth statistics. Markets will be quiet and while the USD/CAD could see a momentary increase in trading, behavioral sentiment from earlier this week will likely have had a bigger effect.

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December Cheer, Full Volume, Considerations for Coming Week

by with No Comment AMT MarketsAssetsFeatured Highlights

December Cheer, Full Volume, Considerations for Coming Week

The EUR/USD finished the past week of trading below its starting point essentially closing this Friday around the 1.08790 mark. While the slight downturn may have hurt bullish day traders who kept on looking for higher ground in the short-term, the EUR/USD did trade above the 1.10000 on late Tuesday and held its ground briefly on Wednesday before starting to trend lower. A depth of nearly 1.08310 was momentarily challenged on Friday with solid price velocity, but the EUR/USD did exhibit some buying before going into the weekend.

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EUR/USD Five Day Chart as of 3rd December 2023

Speculators who were looking for a higher finish for the week from the EUR/USD may have been disappointed, but the end of the trend upwards may not be finished. U.S Fed Chairman Jerome Powell sounded optimistic on Friday regarding Fed policy and mentioned a ‘soft landing’ and indicated interest rates at their current level will still need a bit of time to have their full effect. U.S growth numbers via the Gross Domestic Product came in stronger than expected on the 29th of November, but inflation data continues to show a slight erosion.

This puts the U.S Federal Reserve in position to actually sound rather neutral when the FOMC Meetings conclude in a week and a half. And if global events do not cause any sudden alarms to ring, it appears risk appetite is within a rather optimistic state. U.S equity indices continued to roll along merrily and the 3 big indexes are challenging highs. The S&P 500 and Nasdaq Composite are challenging July values, and the Dow Jones 30 is trading at ratios last seen in January of 2022.

While U.S Treasury yields have also continued to erode and are near mid-term lows, the USD/JPY continued to create a bearish trend for the week and is trading at values last seen in the second week of September. The GBP/USD finished the week within sight of highs attained on Tuesday and Wednesday, this as the currency pair also trades near values last seen in late August and early September. The EUR/USD is the outlier among the three major currency pairs and speculators may look at the EUR as potentially being in oversold territory as the week gets set to begin. Risk management as always is essential for wagering on Forex.

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S&P 500 One Year Chart as of 3rd December 2023

The next two and a half weeks of trading will see full volumes, this before holiday trading starts to hit the broad marketplace. The upward moves in U.S equity indices may be seen as overdone by many analysts, but the trend has been strong and trying to step in front of the ‘optimism’ within the indexes may prove expensive in the coming days and weeks. Day traders should make sure conservative leverage is being used if they are attempting to climb aboard the moving train.

Some analysts are pointing out correctly, that if it weren’t for a few ‘workhorse’ corporations in the U.S equity indices, declines would have been seen. But day traders who are wagering on CFDs via their brokers and financial institutions investing in the three major stock indices are likely enjoying their profitable returns.

Monday, the 4th of December, E.U Sentix Investor Confidence – the reading is expected to come in with a negative result, but slightly better than last month’s outcome of minus -18.6. About a hour and a half before this European survey, German Trade Balance numbers will be released. The EUR/USD may be affected by this data, but the currency pair is likely moving within the shadows of behavioral sentiment which is USD centric. Europe is struggling with recessionary conditions, but it is outlook which drives the marketplace. If the EUR/USD can find durable support it may prove that its bullish trend has not come to an end.

Tuesday, the 5th of December, U.S ISM Services Purchasing Managers Index – an improvement is expected compared to last month’s outcome. Recent data from the manufacturing sector came in less than expected, thus the services sector will be watched closely, but as long as the result is around the expectation this will not hinder broad market sentiment. Meaning the report could be a non-factor.

Wednesday, the 6th of December, Canada BoC Overnight Rate – traders will be keen to see what line of rhetoric is taken within the Rate Statement from the Bank of Canada. No change to borrowing costs are expected. The rate is anticipated to remain at 5.00%. The economy of Canada has been struggling as recessionary clouds are shadowing, but recent GDP data was slightly better than expected and inflation has shown signs of weakening. The USD/CAD went into this weekend near its lows and in sight of values seen in late September.

Thursday, the 7th of December, China Trade Balance – economic numbers via the manufacturing sector last week came in below expectations. The lackluster China data may be a factor in the weaker WTI Crude Oil prices, but perhaps that is only speculative. Some investors participating in China are worried about outlook over the mid-term. Analysts will comment on the Trade Balance numbers, but traders should make sure they separate the ‘noise’ which may be delivered from biased perspectives depending on ‘world view’ compared to actual outcomes and genuine insights.

Friday, the 8th of December, U.S Non-Farm Employment Change and Average Hourly Earnings – the jobs numbers will be looked at attentively by market participants. The data will be correlated to existing behavioral sentiment and risk appetite that has sustained a weaker USD, higher U.S equity indices, lower yields on U.S Treasuries and the high price of gold. If the jobs data comes in around expectations that will likely be enough for investors to remain calm and look forward to the 13th of December, this is when the U.S Federal Reserve will release its FOMC Statement – which may keep risk appetite strong.

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Risks Ahead and Turkey as the USD Gets Speculative Attention

by with No Comment AMT MarketsAssetsFeatured Highlights

Risks Ahead and Turkey as the USD Gets Speculative Attention

The USD stumbled last week as inflation numbers via the Consumer Price Index and Producer Price Index both came in slightly below expectations. Yes, inflation is still dangerous in the U.S, but an erosion of momentum has certainly been hoped for by financial institutions, and they clearly took advantage of the CPI and PPI reports and helped a selloff of the USD build momentum.

The Federal Reserve is now highly anticipated to begin lowering the noise of its aggressive rhetoric, and actually start to sound more neutral when December’s FOMC Statement is delivered. Yes, this is speculative and things can change, but financial institutions like speculators position their assets based on outlooks.

Equity markets in the U.S also showed that there is growing risk appetite which wants to be part of the moves higher in the major indices. The NASDAQ 100, the Dow Industrials 30 and S&P 500 have all sustained upwards movement and are at three month highs with additional upwards targets clearly in sight. However, before day traders try to hop onto the higher trajectory they should remember the speculative timeframes of institutional investors are different than their own. Fear of missing out could feed into buying momentum, but caution is needed.

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GBP/USD Six Month Chart as of 20th November 2023

The GBP and JPY look to be intriguing opportunities for traders with a capacity to hold positions over the mid-term. Having struggled since July of this year, financial institutions are likely looking at these two currencies as having been oversold. Many other major currencies are all rather speculatively attractive at this time, but again, day traders should not wager blindly and keep realistic targets for their short-term wagers.

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USD/JPY Six Month Chart as of 20th November 2023

The U.S will celebrate its Thanksgiving holiday this Thursday. Volumes across the broad markets will begin to drop significantly on late Wednesday, and full trading will not return until Monday or Tuesday of next week until the U.S turkey meals have been digested. Meaning that while risk appetite has certainly begun to creep in the broad markets again, forecasts this week should be treated carefully. Day traders should watch momentum today and tomorrow, if the USD remains weak going into Wednesday, this could signal further weakness in the USD is anticipated. Yet, the dangers of near-terrm reversals exists and speculators should not get over confident.

U.S Treasury yields remain near their five day lows. The price of gold is range trading below its highs made late last week, this as the USD has shown weakness and risk adverse global concerns have also become more calm. Trading results later this week should be viewed suspiciously, price velocity when unbalanced positions are executed often leads to spikes during the Thanksgiving holiday, like the Christmas holiday which will follow in a little more than a month.

Monday, 20th of November, Germany PPI – the inflation data has already been published and the Producer Price Index came in at minus -0.1%, which was below the estimate. Global economic data the remaider of today will be rather light, and behavioral sentiment being generated from U.S markets should be watched.

Tuesday, 21st of November, U.S FOMC Meeting Minutes – this report which will be published late on Tuesday for many global traders, may provide evidence to previous thoughts regarding the outlook for the U.S economy regarding inflations impact on monetary policy. Meaning that if there are signs that FOMC members were already talking about the notion that inflation was eroding last month and was expected to continue to decline further – this could feed into weaker USD outlooks mid-term.

Wednesday, 22nd of November, E.U ECB Financial Stability Review – this report will have limited impact because Forex will remain USD centric. The EUR, like the GBP and JPY, is showing signs of a recovery based on the notion of having been oversold. Traders should be cautious about the EUR/USD later this weeek because of the U.S holiday and expect volatility.

Wednesday, 22nd of November, U.S Core Durable Goods Orders, and Revised Consumer Sentiment via University of Michigan – both these reports may fall on a U.S marketplace that is preparing to escape for the long holiday weekend. Last week’s weaker than anticipated Retail Sales numbers will combine nicely with the Consumer Sentiment reading, but again its affect may be muted. If the Core Durable Goods Orders number meets expectations or comes in with a slightly less than expected statistic, this could help continue to create weaker USD outlooks.

Thursday, 23rd of November, U.K and E.U Flash Manufacturing and Services PMI – the reports from Great Britain and the European Union are expected to show stable results, but also that purchasing managers remain unimpressed by the prospect of future demand over the mid-term in Europe.

Friday, 24th of November, Germany Business Climate via ‘ifo’ – this report is expected to be better than last month’s outcome. If the result is stronger than expected this could help the EUR/USD going into the weekend.

Friday, 24th of November, U.S Flash Manufacturing and Services PMI – both reports are expected to be slightly weaker than the last month’s numbers. U.S trading will be limited before going into the weekend. Yes, many markets will be open but volumes will be sparse. This could set the table for a reaction early next week if financial institutions believe they can take advantage of Forex, equity and commodity markets that became unbalanced during the Thanksgiving holiday celebrations.

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Yields, Credit Worthiness, Trading and Geo-Political Risks

by with No Comment AMT MarketsAssetsFeatured Highlights

Yields, Credit Worthiness, Trading and Geo-Political Risks

Traders participating in Forex and equity indices this week may want to consider finding a very quiet room and avoiding the loud conjecture which is certain to be heard. U.S bond yields will remain a focal point the entire week, and Moody’s new negative label regarding U.S credit worthiness issued late on Friday will not help the Federal Reserve and Treasury as the size of U.S debt is called into question once again. Forex markets provided speculators velocity and volatility last Thursday and Friday, and this week’s risk events are certain to cause behavioral sentiment turbulence.

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USD/CNY Five Year Chart as of 13th November 2023

Added to the ‘fun’ for speculators this week will be the APEC Summit gyrations which will be held in San Francisco, and includes a scheduled meeting with President Joe Biden and President Xi Jinping this Wednesday. The meeting comes at a critical time as geo-political and economic concerns come from Asia, the Middle East and Eastern Europe.

However, traders should not allow their emotions to grow too nervous, financial institutions actually showed a taste for U.S equity indices last week and the price of gold has declined, while the value of Crude Oil per barrel has also eroded. This shows that even in the midst of carnival like barking from pessimistic naysayers, that investors are still participating in the broad markets and makeing bets on the notion that optimism will continue to show sparks of light.

Monday, 13th of November, U.S Federal Budget Balance – this report is certain to be rather negative if studied closely. However, investors already know this story, and last week’s Moody’s downgrade of U.S credit accountability has already rang alarms. Thus, this report will likely fall on deaf ears today.

Tuesday, 14th of November, E.U Flash GDP – the numbers from the European Union are exected to be negative. However, last week’s slightly better than expected Germany Factory Orders may help the European Gross Domestic Product results limit the capability of a surprisingly bad decline. An expectation of only minus -0.1% is awaited.

Tuesday, 14th of November, U.S Consumer Price Index – the inflation numbers from the States will get the attention of most global investors. The results are sure to affect the USD, Treasury yields and equity markets. A weaker than expected outcome could propel the USD lower. Stronger than estimated statistics could ignite buying of the USD based on the notion the Fed will feel compelled to remain aggressive via its monetary policy rhetoric.

Wednesday, 15th of November, China Industrial Production – while the APEC Summit is highlighted by the media, it is economic data from China which remains important. Data from the nation continues to be lackluster and demand for commodities, the USD/CNY, domestic real estate and conusmer spending are all being watched and questioned by financial analysts. A gain of 4.5% is expected.

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GBP/USD Three Month Chart as of 13th of November 2023

Wednesday, 15th of November, U.K CPI, the inflation numbers from Britain will be important and will follow Tuesday’s Average Earnings Index publication. The GBP/USD has found choppy terrain and the results of the combined numbers from the U.K will affect Forex, even if USD centric considerations remain key.

Wednesday, 15th of November, U.S Producers Price Index, Retail Sales, and the Empire State Manufacturing Index – these reports will be issued at roughly the same time and will factor into sentiment created from the U.S CPI data seen the day before. The combination of all these outcomes will play into the broad markets, and the USD within all major currency pairs. Weaker than anticipated numbers would be welcome by USD sellers. However, until the reports are published wagering on the USD will prove volatile and risk management is encouraged.

Thursday, 16th of November, U.S Federal Reserve Officials – at least 4 U.S Federal Reserve members will be speaking at various conferences. They are sure to give their opinions on the Federal Funds Rate outlook and will be asked to comment on the week’s data already published in the U.S regarding inflation and consumer spending.

Friday, 17th of November, U.K Retail Sales – a gain of 0.3% is expected compared to last month’s negative results. Speculators will react to the consumer driven data and the GBP/USD will again come under the influence of risk sentiment regarding outlook. However, traders need to understand these numbers are largely a result of looking backwards and not forwards regarding outcomes.

Friday, 17th of November, U.S Housing Starts and Building Permits – the American housing industry is being closely monitored and the high costs of mortgages is affecting the U.S marketplace. The Building Permits number is expected to be slightly lower than last month’s outcome. Traders should also keep their eyes on the potential of revisions to suddenly emerge from previous reports.

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Fed Rhetoric, U.S Consumers, and Fresh Concerns about China

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Fed Rhetoric, U.S Consumers, and Fresh Concerns about China

U.S inflation data via the Consumer Price Index last Thursday met the anticipated result regarding the core number, and the broad statistics were only fractionally larger than expected. U.S Treasuries yields however jumped via quick reactions about stubborn inflation, then settled down. Equities via the major indices continue to show nervousness.

Day traders continue to get hit by choppiness, which means if they are not on the correct side of a trade initially, they can get knocked out of their positions quickly due to the use of too much leverage.

China produced another round of troublesome Consumer Price Index Producer Price Index reports last Friday, once again highlighting deflation is a legitimate concern for the nation.

The USD began to weaken within many major currency pairs on late Tuesday and early Wednesday, and then began to prove difficult with sideways price action. However, many currencies held onto their slight gains against the USD going into the weekend. But before a massive bearish trend against the USD actually can be sustained, perceptions about the U.S Federal Reserve stands clearly in the way regarding behavioral sentiment.

Inflation numbers last week remained strong enough to suspect the Fed will raise interest rates again on the 1st of November. As a way to keep traders on their toes, U.S Federal Reserve officials will be speaking at many functions over the entirety of this week, offering crumbles of evidence for their less than spectacular rhetoric on the global economy no doubt.

Gold has produced a rather startling climb in the past ten days and its one month charts resemble a rather turbulent roller coaster. Traders who have been pursuing the precious metal during its strong reversals the past handful of weeks have hopefully been using solid risk management while taking a speculative ride.

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Gold One Month Chart as of 16th of October

Monday, the 16th of October, U.S Empire State Manufacturing Index – the number has come in slightly better than expected, but has still produced a negative reading of minus -4.6. While many U.S officials will not state it publicly, a decline in the manufacturing index may pave the way towards a more tranquil Federal Reserve. But this may be wishful thinking too, particularly if inflation remains elevated.

Tuesday, the 17th of October, U.S Retail Sales – the data about consumer spending will affect Forex if there are surprises. Both the core and broad reports are anticipated to be weaker than last month’s numbers. Weaker results could create some USD weakness.

Wednesday, the 18th of October, China Industrial Production, Gross Domestic Product and Retail Sales – the Industrial Production results are expected to be slightly weaker than last months, while the GDP outcome is being estimated to show a significant drop. If the growth number comes in at the anticipated 4.5% mark it would be another signal that China is struggling while trying to jump start the economy. USD/CNY traders should be careful around these reports.

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GBP/USD Six Month Chart as of 16th October

Wednesday, the 18th of October, U.K Consumer Price Index – the CPI data from Great Britain is expected to show a slight decline from the previous month. While last week’s GDP numbers met their rather lackluster expectations; Construction, Manufacturing, Trade Balance data came in much worse than anticipated. While no one from the U.K government is going to cheer on the bad economic numbers from last week, these figures will make these CPI inflation results important to monitor. Will the U.K inflation numbers remain stubborn like the U.S? The GBP/USD certainly needs to be watched in the aftermath of this CPI report.

Thursday, the 19th of October, China New Home Prices – the housing bubble within China is a thing of the past. Last month’s outcome produced another negative number and a poor report would not be a surprise this week. Negative housing values hurt the Chinese public which have largely quantified their personal savings via their real estate holdings.

Thursday, the 19th of October, U.S Unemployment Claims – the weekly report will give another small dose of evidence regarding the strength of the U.S economy for financial institutions to consider.

Friday, the 20th of October, U.K Retail Sales – the consumer spending report is expected to produce a decline of minus -0.3%. GBP/USD traders may use this report as another sphere of influence.

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Inflation Data and Fed’s FOMC Meeting Minutes This Week

by with No Comment AMT MarketsCentral BanksFeatured Highlights

Inflation Data and Fed's FOMC Meeting Minutes This Week

Last week’s economic data ended with rather tantalizing headline jobs numbers as the U.S showed more hiring than expected, but while this grabbed media soundbites in many circles – the Average Hourly Earnings numbers came in below expectations. The broad Forex market proved dynamic with a stronger USD in many cases, but intriguingly equity markets in the States generated upwards momentum on Friday too. U.S Treasuries were mixed regarding their yields, and the 10-year bond while finishing up for the week was below its highs.

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WTI Crude Oil One Month Chart as of 9th of Oct. 2023

The coming week will likely continue to produce nervousness, but outlook will be helped via a couple of U.S inflation reports and the FOMC Meeting Minutes report. Crude Oil prices should be watched as news from the Middle East unfolds. Gold remains under pressure.

Cryptocurrency speculators should keep their eyes on Binance Coin as it battles important lows. Bitcoin has remained relatively stable, but BNB/USD is near crucial support that could signal another wave of pressure is developing within the Binance exchange.

Monday, the 9th of October, International Monetary Fund – week-long meetings get underway and investors who participate in global stock markets and bonds should pay attention to the chatter.

Tuesday, the 10th of October, Central Bank Officials speaking – ECB President Lagarde will be speaking at the IMF conference. Federal Reserve officials will be speaking at meetings in the U.S. While the chatter may cause some nervous reactions briefly in financial institutions, it is unlikely the central bankers will say anything that is surprising.

Wednesday, the 11th of October, U.S Producer Price Index – the broad and core reports should be watched. Last week’s lower Average Hourly Earnings numbers were slightly surprising, but the recent higher energy costs could factor into the PPI results. The broad report is anticipated to show a decline. If the Producer Price Index statistics come in weaker than expected this could help the USD lose some strength.

Wednesday, the 11th of October, U.S FOMC Meeting Minutes – the publication is expected to follow the rhetoric already voiced by the Fed at their last press conference. However, insights regarding dialogue could move the needle in Forex. The U.S central bank is widely expected to raise the Federal Funds Rate in November, but what comes beyond this anticipated move is still in question. Expect the key word in the FOMC report to be ‘inflation’.

Thursday, the 12th of October, U.K Gross Domestic Product – the growth numbers from Great Britain are expected to show a slight rise in GDP. If the gains match expectations or come in better it could help bolster the GBP/USD which has been struggling against the USD for the past three months.

Thursday, the 12th of October, U.S Consumer Price Index – these reports will be crucial and will impact Forex and equities immediately after their release. While the Core CPI number is expected to match last month’s outcome, the broad reports are anticipated to be weaker. If the inflation numbers are stronger than expected the USD could gain strength, if the results are weaker it could help build selling momentum in the USD.

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USD/CNY Six Month Chart as of 9th Oct. 2023

Friday, the 13th of October, China Consumer and Producer Price Index – the two releases will be watched carefully by investors. China’s economic data has been weak and financial institutions have become concerned by deflation. The USD/CNY may be impacted upon the publication of the reports.

Friday, the 13th of October, U.S Consumer Sentiment via the University of Michigan – following the CPI numbers from the U.S on Thursday, these numbers will show the attitude of U.S consumers and their spending habits. Financial institutions will monitor these numbers and correlate them to the U.S inflation reports seen earlier.

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Nervous Outlooks and Short Term Fixes Creating Anxiousness

by with No Comment AMT MarketsBehavioral SentimentFeatured Highlights

Nervous Outlooks and Short Term Fixes Creating Anxiousness

A U.S government shutdown has been avoided, but the resolution highlights that an important year of political games is getting fully underway in Washington. Short term fixes via congressional agreements do not hide the fact the U.S government continues to bleed money and is adding to its deficit as yields on U.S Treasuries remain high.

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Gold Five Day Chart as of 2nd October 2023

The price of gold has sank substantially in the past week, which shows the USD continues to be strong, and that speculative short-term games within the precious metal must always be kept in mind by day traders. Long term fundamental beliefs regarding the value of gold cannot stop momentary volatility.

GDP results from the U.S last week came in slightly below estimates, but the ability to still sustain growth also creates the suspicion the U.S economy remains stubbornly strong, which effectively puts the U.S Federal Reserve in a rather difficult place. Crude Oil prices have remained high, and this week’s coming jobs data will be important for short and mid-term market participants as they position themselves while nervous behavioral sentiment continues to be evident.

U.S stock markets are near three month lows and trading conditions choppy, this as yields on U.S Treasuries are elevated and create a tough road for speculators to navigate in the short-term.

Monday, 2nd of October, U.S ISM Manufacturing PMI – a reading below 50 is anticipated which would mean sentiment remains negative regarding the U.S economy, but Core Durable Goods Orders came in better than expected last week. Thus, the result of this manufacturing report could play into short and near-term USD trading and cause a ripple as financial houses anticipate the jobs numbers later this week.

Tuesday, 3rd of October, Reserve Bank of Australia – the RBA is expected to keep its Cash Rate in place. If the RBA cooperates with financial institutions and does not change its key borrowing rate , the RBA Rate Statement will come into focus. However, the AUD/USD is still within the shadows of U.S Federal Reserve like most other major currencies.

Wednesday, 4th of October, U.S ISM Services PMI – the outcome from the Services report is expected to fall below last month’s outcome. The slight miss in the GDP numbers last week was noteworthy, but the better than expected Core Durable Goods results will make this report of interest and provide a bit of impetus to the USD and U.S indices before Friday’s key jobs data – particularly if the Services reading is better than anticipated.

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GBP/USD Three Month Chart as of 2nd Oct. 2023

Thursday, 5th of October, U.K Construction PMI – while not considered a major publication by many analysts, the ordering by purchasing managers in Britain may prove relevant as an indicator regarding outlook. The Bank of England held their interest rates in place a couple of weeks ago and this was based on the belief the U.K economy is slowing. The Construction PMI report is expected to come in slightly below last month’s outcome which could set the table for slight choppiness in the GBP/USD which has continued to trend lower.

Friday, 6th of October, U.S Non-Farm Employment Change and Average Hourly Earnings – the combination of these two reports will impact USD trading before their publication and afterwards for several hours. Financial institutions will examine these statistics carefully. If there is a hint of weakness in the U.S jobs market and wage inflation is tame, this could make the USD weaker. However, if jobs hiring remains firm and there is a slight uptick in the costs employers are having to pay workers, the USD could get stronger.