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2021-02-26 17:24:01 Data from the US continues to paint a bright picture, exceeding expectations. But this only adds to the contrast with the recent stock market performance.

The monthly personal income report for US saw a 10% jump in January due to $600 direct cheques and the enhanced unemployment benefits programme's extension. This is better than the expected 9.4% and a bit less than the 12.2% jump in April-20 when Govt sent more substantial payments.

In contrast to last April, this time, the lift in income has pulled in spending. For January, they rose 2.4% (vs 2.6% forecasted). Americans still maintain a cautious approach to spending, which is 1% below pre-pandemic levels, while disposable income has added 14%.

Another support package, including $1400 payments, is on the verge of being approved by US lawmakers. Will it increase Americans' propensity to consume? Quite possibly if people start to fear rising prices and seriously lose confidence in stocks. Open / Comment

2021-02-26 12:05:43 Where are the targets of correction as market sell-off widens?

The S&P500 is trading at 3800, which is close to the 50-day average. A consolidation well below this line, like a year ago, would increase the volatility and widen the sell-off. The next target of the correction then could then be 3500, near where the 200-day average passes.

A breakdown of GBPUSD under 1.3850 would soon open the way to 1.3600. The most pessimistic scenario now appears to be a pullback of GBPUSD to 1.3100.

For gold, the next significant level is $1700, a failure under which would be a complete surrender of the bulls that pushed the price up for two years through to August 2020.

Read more here Open / Comment

2021-02-25 19:04:51 #WaveAnalysis

#EURGBP reversed from support area

• Likely to reach resistance level 0.8700

https://fxpro.news/market-snapshots/eurgbp-wave-analysis-25-february-2021-20210225/ Open / Comment

2021-02-25 19:03:51 #WaveAnalysis

#EURUSD broke key resistance level 1.2150

• Likely to reach resistance 1.2350

https://fxpro.news/market-snapshots/eurusd-wave-analysis-25-february-2021-20210225/ Open / Comment

2021-02-25 17:25:53 The number of Initial Jobless Claims fell sharply last week from 841K to 730K, the lowest since November. The number of continued claims fell by 100k to 4.419M. Perhaps this improvement can be attributed to bad weather when some prefer not to apply for benefits.

The other good news is that Durable Goods Orders rose by 3.4% in January, which is better than the expected 0.9%. Orders ex transportation sector grew 1.4%, marking a new historical record. The figures here indicates a V-shaped recovery and is an important signal of business confidence in the long-term economic outlook. Businesses buy durable goods only when they are confident of expansion.

And it is also good for equity and commodity markets, pointing to a brighter demand outlook. Simultaneously, it undermines the value of the dollar, as the Fed assures that monetary policy will remain ultra-soft in the near term, weakening the value of the currency. Open / Comment

2021-02-25 12:53:35 Markets rise, but leaders are changing
The markets are dominated by bets that the world economy is returning to normal. In this race, the former leaders, the so-called FAANG and companies like Tesla look a little tired after last year’s acceleration. Traditional value stocks and commodity sectors are now getting a chance to narrow the gap with high-tech companies.

As confirmation of buyers’ strength, the Dow Jones30 has added 1.35%, and futures are now above 32,000. The Nasdaq100 found support after failing under the 50-day average earlier in the week, while the S&P500 reversed upward after touching its 50-DMA.

Yesterday we saw a simultaneous rise in long-term government bond yields and a rebound in the Nasdaq index. However, we can hardly draw far-reaching conclusions from this. Further development of rising government bond yields will keep the market focus on value equities and commodities.

Nevertheless, this does not at all rule out short-term pullbacks within the general trend. Open / Comment

2021-02-24 19:59:41 #WaveAnalysis

#CADCHF broke resistance levels 0.7150 and 0.7200

• Likely to reach resistance 0.7250

https://fxpro.news/market-snapshots/cadchf-wave-analysis-24-february-2021-20210224/ Open / Comment

2021-02-24 19:29:42 #WaveAnalysis

#Chevron rising inside sharp impulse wave 3

• Likely to reach resistance 103.85

https://fxpro.news/market-snapshots/chevron-wave-analysis-24-february-2021-20210224/ Open / Comment

2021-02-24 18:56:26 The UK boasts an impressive population vaccination rate, which is already paying off: the number of new daily deaths from coronavirus fell by three times over the month and almost six times for new daily cases.

Therefore, the prospects of a complete lockdown lifting in the UK now look much more certain.

This has attracted speculative interest in the pound. GBPUSD went to 1.4237 this morning, having gained 5% in the last 20 days. The rise in the British currency is most resilient in crosses with the euro, franc and yen.

This morning there was a solid breakdown of stop orders, sending EURGBP below 0.8550 (-5% YTD), while GBPJPY was above 150 (+7.5% YTD) and GBPCHF was approaching close to 1.29 (+8.4% YTD).

The RSI index on the daily charts in these pairs exceeds 80 (20 for EURGBP), pointing to extreme overbought conditions for the pound. This very extended rally formed the base for a short-term correction, for the start of which a simple halt in the rise may be sufficient. Open / Comment

2021-02-24 13:14:03 Dollar have Powell on its side

we do not share the optimism of many commentators, who argue that continued policy easing promises have reassured investors. The US 10-year yields have declined from 1.39% on Monday to 1.33% in debt markets now, just a shy drop after growth from 0.9% year to date.

In our view, the markets were hoping to hear hints from Powell about the possibility of expanding QE, which could stop the rise of bond yields.

Promises to keep an unchanged policy could push up US government bond yields in the coming months, causing pressure on risk assets, including growth stocks.

In the meantime, Powell’s assurances are relatively good news for the US currency. The Dollar Index has been unchanged over the past 24 hours and remains near 90, the low area since mid-January. However, beneath this lull is a strengthening of USD against the defensive JPY and CHF, stability against the EUR and a decline against GBP, AUD, NZD, where the economy is recovering faster. Open / Comment