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USD/CAD eyes Canadian job data, US PMIThe Canadian dollar continues to gain ground against a slumping US dollar. In the European session, USD/CAD is trading at 1.3529, down 0.23%. The Canadian currency is poised to post a third straight winning week against the greenback and soared 2.25% in November. It is a busy Friday, with Canada releasing the employment report, the US publishing the ISM Manufacturing PMI and Fed Chair Powell speaking at an event in Atlanta. Canada's labour market has softened but remains in good shape and has shown expansion for three straight months. The economy is expected to have added 15,000 jobs in November, slightly lower than the 17,500 reading in October. The market consensus for the unemployment rate stands at 5.8%, compared to 5.7% in October. This week's GDP report was another reminder that the economy remains weak. Third-quarter GDP declined by 0.3% q/q, below the revised o.3% gain in Q2 and the first decline since the second quarter of 2021. High interest rates have cooled the economy and exports were down in the third quarter as global demand remains weak. On an annualized basis, GDP slid 1.1% in the third quarter, compared to a revised 1.4% gain in Q2 and shy of the market consensus of 0.2%. The US wraps up the week with the ISM Manufacturing PMI. The manufacturing sector has been in a prolonged slump and the PMI has indicated contraction for twelve consecutive months. The PMI is expected to improve to 47.6 in November, compared to 46.7 in October. A reading below 50 indicates contraction. Investors will be listening closely to Jerome Powell's remarks today, looking for hints about upcoming rate decisions. Powell has stuck to his script of a 'higher for longer' rate policy, but the markets have priced in a rate cut in May at 84%. USD/CAD tested resistance at 1.3564 in the Asian session. Above, there is resistance at 1.3665 1.3494 and 1.3434 are providing support
by OANDA
EUR/USD drops ahead of eurozone CPIThe euro is in negative territory in Thursday trade. In the European session, EUR/USD is trading at 1.0940, down 0.27%. Germany's inflation rate declined sharply in November and the eurozone is up next, with the November inflation report later today. German inflation dropped to 3.2% y/y in November, down from 3.8% in October and below expectations. This was the lowest inflation rate since June 2021 and was driven by lower food and energy inflation. Will eurozone inflation follow suit? The markets are expecting a modest decline for November. Headline inflation is expected to fall to 2.7%, down from 2.9% in October, and the core is expected to ease to 3.9%, down from 4.2% in October. If inflation falls modestly as expected, it is unlikely to cause the ECB to reconsider its rate policy. The markets have priced in a rate cut in May 2024 and a softer-than-expected print would likely result in the odds of a rate cut being brought forward. The ECB has signalled a 'higher for longer policy', as have the Federal Reserve and other major central banks. Even though inflation has been dropping, it remains considerably higher than the ECB's 2% target and the central bank hasn't given any indications of a rate cut. Investors will be looking for hints about rate policy from ECB President Christine Lagarde, who will speak today at an ECB forum in Frankfurt after the eurozone inflation release. In the US, second-estimate GDP for the third quarter was revised to 5.2%, up from the initial estimate of 4.9%. The strong reading should ease fears of a recession but also provides the Fed with little reason to trim rates while inflation remains well above the 2% target. The Fed has signalled a 'higher for longer' stance on rates but the markets are more dovish and have priced in a rate hike in March 2024 at 45%, according to the CME's FedWatch tool. EUR/USD is putting pressure on support at 1.0920. Below, there is support at 1.0873 1.0986 and 1.1033 are the next resistance lines
by OANDA
EUR/USD dips as German inflation declinesThe euro is showing limited movement on Wednesday. In the North American session, EUR/USD is trading at 1.0984, down 0.11%. Gerrmany's inflation rate dropped more than expected, coming in at 3.2% y/y in November. This was down considerably from 3.8% in October and below the market consensus of 3.5%. This was the lowest inflation rate since June 2021 and was driven by lower food and energy inflation. Services inflation eased to 3.4%, down from 3.9%. Core inflation dropped to 3.8%, down from 4.3% in October. There's a lot to like in this inflation print and ECB policy makers will no doubt be pleased as German inflation continues to fall. The next text is on Thursday, with the release of eurozone inflation for November. Headline inflation is expected to fall to 2.7%, down from 2.9%, and the core is expected to ease to 3.9%, down from 4.2%. The ECB has signalled a 'higher for longer policy', as have the Federal Reserve and other major central banks. Even though inflation has been dropping, it remains higher than the ECB's 2% target, and the central bank hasn't given any indications of a rate cut. The markets are more dovish and have priced in a rate cut as early as May. If eurozone CPI follows the German release and declines more than expected, we could see the odds of a rate cut brought forward ahead of May. The US economy provided another reminder today that the economy is in strong shape. US GDP (second estimate) climbed an impressive 5.2% y/y in the third quarter, the strongest quarter since Q4 2021. The release beat the market consensus of 5.0% and was higher than the preliminary estimate of 4.9%. The economy showed marked improvement compared to the second quarter, which had growth of just 2.1%. EUR/USD is testing support at 1.0986. Below, there is support at 1.0920 1.1033 and 1.1099 are providing support
by OANDA
EUR/USD steady as German GDP contractsThe euro is almost unchanged on Friday. In the European session, EUR/USD is trading at 1.0903, down 0.03%. German GDP posted a minor drop in the third quarter, coming in at -0.1% q/q. This was down slightly from -0.1% in the second quarter and matched the market consensus. On an annualized basis, GDP declined by 0.4%, down from a revised o.1% gain in Q2 and missing the market consensus of -0.3%. The consumer spending component of GDP decelerated in the third quarter and was a key driver of the decline in GDP. German consumers remain in a sour mood and are being squeezed by rising interest rates and a high inflation rate of 3.8%. The German business sector is also pessimistic about economic conditions. The Ifo Business Climate index managed to climb to 87.3 in November, up from 86.9 in October but below the market consensus of 87.5. A reading below 100 indicates that a majority of the companies surveyed expect business conditions to deteriorate in the next six months. Earlier this week, German services and manufacturing PMIs pointed came in below 50, which points to contraction. The manufacturing sector is particularly weak and has been in decline since June 2022. It has been a relatively light week for US releases, with markets back in action after the Thanksgiving holiday. Later today, the US releases manufacturing and services PMIs, with little change expected. Still, the markets will be watching carefully, as the data will provide insights into the strength of the US economy. The consensus estimates for November are 49.8 for manufacturing (Oct: 50.0) and 50.4 for services (Oct. 49.8). If the readings diverge significantly from the estimates, we could see some strong movement from the US dollar before the weekend. There is resistance at 1.0943 and 1.0997 1.0831 and 1.0748 are providing support
by OANDA
Understanding GDP Growth: A Key Indicator of Economic HealthIntroduction Gross Domestic Product (GDP) growth is a crucial economic indicator that provides insight into the overall health and performance of a country's economy. As a comprehensive measure of a nation's economic activity, GDP growth reflects the value of all goods and services produced within a country over a specific period. In this article, we will explore the significance of GDP growth, its components, and the impact it has on various aspects of a nation's well-being. Definition and Components of GDP GDP is the total value of all goods and services produced within a country's borders in a given time frame. It is commonly calculated quarterly and annually. There are three main ways to measure GDP: the production approach, the income approach, and the expenditure approach. Each approach provides a unique perspective on economic activity. Production Approach: This method calculates GDP by adding up all the value-added at each stage of production. It includes the value of intermediate goods and services to avoid double counting. Income Approach: GDP can also be measured by summing up all the incomes earned by individuals and businesses within a country, including wages, profits, and taxes minus subsidies. Expenditure Approach: This approach calculates GDP by summing up all the expenditures made in the economy. It includes consumption, investment, government spending, and net exports (exports minus imports). Importance Here are some of the primary reasons why GDP growth is considered important: Economic Health - GDP growth is a fundamental measure of a country's economic health. A positive growth rate indicates that the economy is expanding, producing more goods and services over time. This growth is essential for creating jobs, increasing incomes, and improving overall living standards. Job Creation - A growing economy often leads to increased employment opportunities. As businesses expand to meet rising demand for goods and services, they hire more workers, reducing unemployment rates and contributing to a more robust labor market. Income Generation - GDP growth is linked to the overall income generated within a country. As the economy expands, incomes generally rise, providing individuals and households with more financial resources. This, in turn, contributes to an improvement in the standard of living. Investment Climate - Investors and businesses often use GDP growth as a critical factor in assessing the attractiveness of a country for investment. A growing economy suggests potential opportunities for businesses to thrive, encouraging both domestic and foreign investments. Government Policy - Policymakers use GDP growth data to formulate economic policies. High GDP growth rates may lead to expansionary policies aimed at sustaining economic momentum, while low or negative growth rates may prompt policymakers to adopt measures to stimulate economic activity. Consumer and Business Confidence - Positive GDP growth contributes to increased confidence among consumers and businesses. When people perceive a growing economy, they are more likely to spend money, and businesses are more inclined to invest and expand. International Competitiveness - A country with a strong and growing economy is often viewed as more competitive on the global stage. A robust GDP growth rate enhances a nation's economic influence and can attract international trade and investment. Government Revenues - Higher GDP growth rates can lead to increased tax revenues for the government. This additional income can be used to fund public services, infrastructure projects, and social programs, contributing to the overall development of the nation. Debt Management - Economic growth can help manage a country's debt burden. A growing economy typically generates more revenue, making it easier for the government to service its debt without relying excessively on borrowing. Poverty Reduction - Sustainable GDP growth is often associated with poverty reduction. As the economy expands, opportunities for employment and income generation increase, helping to lift people out of poverty. Conclusion In conclusion, Gross Domestic Product (GDP) growth stands as a cornerstone in understanding and evaluating a nation's economic well-being. Through its comprehensive measurement of all goods and services produced within a country, GDP growth provides valuable insights into economic health, job creation, income generation, and various other facets that collectively contribute to the overall prosperity of a nation. The three approaches to measuring GDP—production, income, and expenditure—offer distinct perspectives, ensuring a holistic understanding of economic activity. The importance of GDP growth cannot be overstated, as it serves as a fundamental gauge of a country's economic trajectory and influences crucial decision-making processes at both the individual and policy levels. The positive correlation between GDP growth and job creation underscores the role of a thriving economy in fostering employment opportunities and contributing to a robust labor market. Additionally, the impact on income generation translates into an improved standard of living for individuals and households, reflecting the tangible benefits of economic expansion. Investors and businesses keenly observe GDP growth as a key indicator when evaluating the potential for investment. Government policymakers, armed with GDP data, craft strategies to either sustain economic momentum or stimulate activity, underscoring the pivotal role GDP growth plays in shaping economic policies. The ripple effects of GDP growth extend to consumer and business confidence, international competitiveness, government revenues, and effective debt management. A growing economy not only instills confidence but also attracts global trade and investment, positioning the nation favorably on the international stage. Perhaps most importantly, sustainable GDP growth is intricately linked to poverty reduction. As the economy expands, opportunities for employment and income generation increase, contributing to the uplifting of individuals and communities from poverty. In essence, the study of GDP growth goes beyond mere economic statistics; it serves as a compass guiding nations towards prosperity, inclusive development, and an improved quality of life for their citizens. Recognizing the multi-dimensional impact of GDP growth enables policymakers, businesses, and individuals to make informed decisions that foster long-term economic well-being and societal advancement.
FRED:GDPEducation
by financialflagship
MV=PQ RevisitedHistorical data can be hard to compare against modern ones. The longer back an analyst goes, the better the results of their analysis. 100 years of yield rate analysis may seem enough... 5000 years of interest rates however is a whole new story. Money has been as cheap as it has been for the past 5000 years. Incredible numbers... Source: www.trustnet.com Fun Fact: Banks have existed since the early days of humanity! Unsurprisingly, trading is not a modern invention. Many agree that yield rates have been too low and equities too high. Some go against the flow and suggest that the stock market bubble has yet to come. I have been looking here and there, trying to find the reason the .com bubble was created in the first place. With that in mind I hoped that I would find when the next one will come... Price has just skipped through the previous ceiling, and is now in a new territory. The drawn channel suggests that SPX hasn't reached the top of its channel. There are many more comparisons that may suggest that equities haven't peaked. By comparing DJA with one of its subsets (DJI) we have concluded that the DOW hasn't saturated yet. This analysis above is as classical as it gets. While many thought equities would die ... ... the Bane of Traders has trapped many of us, myself included. Big-Tech dominance inside Nasdaq Composite suggests that a .com bubble may be brewing inside IXIC, just like we saw in SPX/CPIAUCSL in 1994. Onto the basics of financial now. MV=PQ is one of the foundations of how economies function. For more information read my previous idea: For simplicity reasons, we merge PQ. I don't have financial data for each one of them. PQ for the US is considered as the GDP. Another example of GDP can be SPX, which extends beyond the limits of US soil. GDP has been slowing down... USGDP is the total cost of all products produced in the US. A slowing GDP means a slowing net-production of the US market. If productivity hasn't changed significantly in the past decade, a slowing GDP may be due to falling prices. And with yield rates nearing zero in 2020, we can safely say that inflation has turned negative in the US. A slowing GDP may also mean that equities have slowed down. This gives more importance to the incoming-equity-bubble scenario. An equity bubble may come for some, but not for all. The tide has turned in favor of NDX against IXIC, and DJI against DJA. Charting suggests wealth accumulation in a smaller part of the main idices. GDP may be breaking out. With money velocity (main chart) in record-low values, we can expect faster money flow in the years to come. That means increased productivity/inflation/GDP. As expected, long-term inflation may also be breaking out of its decreasing trend. Don't forget: High inflation may be a problem for some. An increased GDP growth caused by high inflation will certainly help the chosen big-ones. There cannot be high GDP with nobody profiting from it. To get rich you must inherit or steal. -Aristotle Onassis In the end, trading hasn't changed at all in 5000 years. There are still pirates, kings, queens, emperors and peasants. Markets will march upwards with or without us. Tread lightly, for this is hallowed ground. -Father Grigori
FRED:GDP
by akikostas
1
USD/JPY slips on soft US inflationThe Japanese yen has rebounded on Tuesday with strong gains. In the North American session, USD/JPY is trading at 150.70, down 0.67%. The yen has snapped a nasty six-day losing streak which saw the currency lose 1.5%. The US dollar is broadly lower today after the October inflation report was weaker than expected. US inflation was softer than expected in October. Headline CPI eased to 3.2% in October, down from 3.7% in September and August and lower than the market consensus of 3.3%. Much of the downswing can be attributed to lower gasoline prices. On a monthly basis, headline CPI was unchanged, compared to a 0.4% gain in September and a market consensus of 0.1%. The core rate, which excludes food and energy prices, showed a more moderate decline. Core CPI fell from 4.1% to 4.0%, shy of the market consensus of 4.1%. Monthly, core CPI dropped from 0.3% to 0.2%, below the market consensus of 0.3%. The markets have responded to the soft inflation print by repricing in a pause in December at 94%, compared to 85% a day earlier. Japan's GDP is expected to have contracted in the third quarter, with a consensus of -0.4% y/y. This would be a huge downturn from the 4.8% gain in the second quarter and could have significant ramifications on monetary policy. If the economy experienced negative growth as expected, the Bank of Japan will find support for its argument that the economy is too fragile to exit negative interest rates. There has been growing speculation that the central bank will tighten policy in the near term due to persistently high inflation and signs of wage growth. A weak GDP print will provide the BoJ with a reason to continue its ultra-loose policy until there is evidence that growth is strengthening. USD/JPY pushed below support at 151.61 and is testing support at 150.82 There is support at 150.05 and 149.29
by OANDA
GBP/USD stems slide as GDP beats estimateThe British pound is steady on Friday. In the European session, GBP/USD is trading at 1.2219, down 0.02%. The pound is coming off a nasty four-day slide, in which it declined 1.19%. Today's UK's GDP numbers weren't pretty, but they managed to beat the forecasts, which has helped the British pound stabilize after a disappointing week. The economy flatlined in the third quarter, below the Q2 reading of 0.2% q/q but higher than the market consensus of -0.1%. Monthly, GDP eked out a gain of 0.2%, versus a revised 0.1% in July and above the market consensus of 0.0%. The lack of growth in the third quarter is nothing to cheer about, but at least the UK will avoid a recession this year, which is defined as two consecutive quarters of negative growth. High interest rates and stubborn inflation continue to squeeze consumers and businesses, and a sharp drop in house sales has dragged down the services sector. Consumers are in a sour mood due to the cost of living crisis and are expected to cut down on Christmas shopping. The Bank of England lowered its growth forecast for the fourth quarter at its meeting earlier this month when it kept interest rates unchanged. GDP is expected to rise just 0.1% q/q. Inflation is projected to fall back to the 2% target at the end of 2025, six months later than the previous forecast. Governor Bailey has been stressing that inflation remains too high, but the BoE nevertheless voted to hold rates after 14 straight increases. Another pause at the December meeting would be the central bank's preferred plan of action, data permitting. There is resistance at 1.2287 and 1.2344 1.2183 and 1.2091 and are providing support
by OANDA
1
GBPUSD Analysis 10-11-23The GBPUSD broke down from yesterday's consolidation at 1.2280 due to the DXY strength. As the price currently consolidates along the 61.8% fib retracement level (1.2225), the easy trend-following setup would be for a continuation of the downside toward the support level of 1.2160 and trendline, if the DXY continues to strengthen. However, an alternative view to consider would be for a retracement on the GBPUSD, to retest the resistance level and 38.2% fib retracement level (1.2290), especially given that the UK GDP data was released today at 0.2%, slightly higher than forecasted.
Short
by JinDao_Tai
GBP/USD calm ahead of UK GDPThe UK economy has been struggling and Friday's GDP is expected to indicate negative growth, with a market consensus of -0.1% q/q for the third quarter. In Q2, GDP showed a small gain of 0.2%. August GDP is expected at 0.0% m/m, after a 0.2% gain in September. A soft GDP report will raise speculation about a recession and could weigh on the pound. Bank of England Chief Economist Huw Pill appeared to backtrack earlier today after saying on Wednesday that market pricing of a rate cut in August 2024 was "not totally unreasonable". Pill stated on Thursday that the BoE expected to maintain restrictive rates for an extended period, but would not make any promises. On Wednesday, Governor Bailey dismissed the possibility of rate cuts in the short term, and Pill may have wanted to put to rest any speculation that his remarks contradicted Bailey's comments. The BoE maintained rates at 5.25% last week and holds its next meeting on 14 December. Federal Reserve Chair Jerome Powell didn't discuss monetary policy in public remarks on Wednesday, and the markets will again be looking for some hints about monetary policy when Powell speaks later in the day. Earlier this week, two Fed members sounded hawkish about inflation. On Wednesday, Philadelphia Fed President Harker said he expected rates to stay higher for longer and there were no signs that the Fed would trim rates in the near term. This followed Dallas Fed President Logan, who said that inflation remains too high and looks to be trending towards 3% rather than the Fed's 2% inflation target. Logan warned that the Fed would have to maintain tight financial conditions in order to bring inflation back to target. 1.2287 is a weak resistance line. Above, there is resistance at 1.2340 There is support at 1.2214 and 1.2175
by OANDA
TradePlus-Fx|GOLD: high's update💬 Description: The metal follows the previously planned course exactly. Demand continues to grow, including against the backdrop of the aggravated situation in the Middle East, but in addition, purely technically, sellers cannot realize their sales at the local elites. In the very near future, most likely, Gold prices will go towards updating local highs. In turn, this will cause another activation of sellers’ stop losses, and the approach to 2000 will be implemented. 🔔 FX CALENDAR TODAY 🔔 🇪🇺ECB Interest Rate Decision 🇺🇸GDP 🇺🇸Trade Balance 🇪🇺ECB Press Conference 🇺🇸Pending Home Sales 🇪🇺ECB President Lagarde Speak 🇺🇸KC Fed Manufacturing Index ➖➖➖➖➖➖➖ 🚀Thank for your BOOSTS 🚀 👇Share your views and FOLLOW US 👇
OANDA:XAUUSDLong
by TradePlus-Fx
12
Market Update - October 27th Bitcoin hits $35k amid more encouraging ETF news: BTC soared from ~$30k USD to ~$35k earlier in the week, before settling around $34k USD by Friday. Spurring the price action, news began circulating on Monday that BlackRock’s spot bitcoin ETF, with the ticker IBTC, was listed with the DTCC, leading to speculation that the ETF was nearing approval. Bitcoin open interest on CME hits all-time highs: Open interest for bitcoin derivatives on the Chicago Mercantile Exchange (CME) hit 100,000 BTC (~$3.4 billion USD). The trend may reflect growing interest in bitcoin from institutional investors as the conversation around a coming spot bitcoin ETF continues to heat up. SEC directed to review Grayscale’s spot bitcoin ETF application: A US federal court issued a mandate directing the SEC to review Grayscale's application for a spot bitcoin ETF. Grayscale submitted a registration statement to the SEC on October 19, stating its intention to list shares of its spot bitcoin ETF on the New York Stock Exchange Arca under the ticker GBTC. Q3 GDP beats estimates, and treasury yields continue to rise: Third-quarter US GDP showed robust growth of 4.9% on an annual basis, surpassing estimates of 4.7%. Treasury yields continued to rise, putting additional pressure on equities. Yields on the 10-year treasury surpassed 5% on Monday, hitting its highest level in over a decade, but has since dipped to the 4.8% range. 🤝Topic of the Week: Basic Trading Order Types ➡️ Read more here
GEMINI:BTCUSD
by Gemini
USD/JPY edges lower, Tokyo Core CPI risesThe Japanese yen has steadied after three straight days of losses. In the European session, USD/JPY is trading at 150.11, down 0.19%. Tokyo Core CPI climbed 2.7% y/y in October, above 2.5% in September which was also the consensus estimate. The index, which excludes fresh food is a key indicator of inflation trends in Japan and is closely monitored by the Bank of Japan. Tokyo's headline CPI also rose in October, from 2.8% to 3.3%. The Bank of Japan will find it hard to ignore these hotter-than-expected inflation readings. The timing of these releases is awkward for the BoJ, which holds its policy meeting on Oct. 30-31. Underlying inflation is proving to be stickier than expected and BoJ policy makers may have to revise upwards their inflation outlooks for 2023 and 2024. High inflation is a risk to Japan's recovery, putting pressure on the BoJ to make some kind of move at the meeting. The central bank will have a busy agenda at next week's meeting. Aside from stubbornly high inflation, the BoJ will have to decide whether to tweak its yield curve control (YCC) program and what to do about the falling yen. The Japanese currency breached the symbolic 150 line this week for the first time since October 3rd, raising speculation that the BoJ could shift its policy or even intervene in the currency markets. Tokyo has responded to the yen breaching 150 with the usual verbal intervention, warning investors not to sell the yen. The BoJ won't be providing any advance warning about a currency intervention, so traders should remain on alert. For those doubting US exceptionalism, the superb US GDP of 4.9% in the third quarter was proof in the pudding of a robust US economy. This was the fastest growth rate since Q4 of 2021, boosted by strong consumer spending in the third quarter. The sharp rise in growth hasn't changed market expectations with regard to rates, which have priced in pauses at the November and December meetings. USD/JPY is testing support at 1.5017. Below, there is support at 149.67 There is resistance at 1.5049 and 1.5099
by OANDA
AUD/USD edges lower, China data beats expectationsThe Australian dollar started the day higher but has reversed directions. In the North American session, AUD/USD is trading at 0.6357, down 0.13%. The US dollar has steamrolled the Aussie, which hasn't posted a winning week since September and dropped close to a one-year low last week. The Australian dollar has bounced back this week, however, gaining 1.08%. The situation in the Middle East remains perilous, with the risk that the Israel-Hamas war could spread and ignite a regional war. President Joe Biden has arrived in Israel, a move intended as a warning to Iran and others not to enter the conflict. The fighting has not affected risk sentiment, as investors haven't panicked and snapped up greenbacks. Still, the Middle East is a powder keg at present and if the situation worsens, we could see a flight to the US dollar. Australia will release employment numbers on Thursday. Job growth has been solid and posted a strong gain of 64,900 in August. Employment is expected to fall sharply to 20,000 in September. Unemployment has been at low levels and is expected to remain at 3.7% for a third straight month. China is Australia's number one trading partner, which means that Chinese releases can have a significant impact on the Australian economy. China's post-Covid recovery has been much weaker than expected, and deflationary pressures and a property crisis could have negative implications for the global economy. Chinese released key data on Wednesday and all three releases beat expectations. GDP for Q3 rose 4.9% y/y, above the consensus estimate of 4.4% but well shy of second-quarter growth of 6.3%. Retail sales for September climbed 5.5% y/y, up from 4.6% in August and above expectations of 4.9%. Finally, industrial production was unchanged in September at 4.5% y/y, compared to the consensus estimate of 4.3%. China's economy may be in better shape than expected, but the road to recovery is likely to be a bumpy one. AUD/USD is putting pressure on support at 0.6343. Below, there is support at 0.6240 0.6399 and 0.6430 are the next resistance lines
by fisherkj4
GBP/USD drifting ahead of UK GDPThe British pound is calm on Wednesday. In the European session, GBP/USD is trading at 1.2297, up 0.10%. The UK economy has been struggling and GDP declined by 0.5% m/m in July. The markets are expecting a rebound on Wednesday, with GDP projected to rise by 0.2% m/m in August. For the three months to August, GDP is expected to increase by 0.3%, up from 0.2% in the previous release. The IMF report on Tuesday didn't bring much cheer, with the report stating that the Bank of England would need to maintain elevated interest rates into 2024 due to weak growth and sticky inflation. The same day, the BoE's Financial Policy Committee also said that rates would have to "stay high for a long time", warning that would put pressure on households. The Federal Reserve has kept to a hawkish script, trying to convince the markets that the tightening cycle may not be over. That message has changed in recent days, as the Fed has become more dovish. The reason? US Treasury yields have been rising sharply, with 10-year yields hitting a 16-year high on Tuesday. The spike in yields has made borrowing costs more expensive and could act as a brake on the economy and push inflation lower without Fed intervention. Atlanta Fed President Raphael Bostic said on Tuesday that the Fed didn't need to raise rates anymore in order to push inflation back to the Fed's 2% target. Bostic is considered a dove, but he has support for this position. Dallas Fed President Lorie Logan and San Francisco Fed President Mary Daly both stated that the increase in Treasury yields could mean less need for the Fed to raise rates in the current tightening cycle. 1.2179 and 1.2097 are providing support 1.2321 is a weak resistance line. Above, there is resistance at 1.2403
by fisherkj4
A very long-term (Macro) Approach To US/Global MarketsAfter completing my weekend research/videos, I wanted to create something that provided an anchor for traders/investors. This video is not focused on the short-term market trends - although it does discuss what I expect to see play out over the next 12 to 24 months. This video is more about preparing traders/investors for the global events related to Central Banks, market trends/opportunities, and how I believe the markets will react over the next 5+ years. After watching this video, your job will be to watch for key events to unfold. These events, described in the video, will be key to understanding where opportunities and risks are in market trends. This is NOT the same market we've been used to from 2010 through 2021. This is an entirely different beast of a global market. Credit/debt issues will persist, and conflicts/war may drive major repricing events. Pay attention and follow my research. I'm delivering this long-term research to help you better prepare for market trends and protect your capital from downside risks.
AMEX:SPYEducation
by BradMatheny
EUR/USD extends losses, eyes German inflationThe euro has extended its losses on Wednesday and has declined close to 1% this week. In the European session, EUR/USD is trading at 1.0552, down 0.18%. Germany has traditionally been the powerhouse of Europe but finds itself lagging in the rear, with a struggling economy and high inflation. The GfK Consumer Climate index fell to -26.5 for October, down from a revised -25.6 in September and shy of the market consensus of -26.0. This was the lowest reading since April and suggests that consumer sentiment will remain weak in the near future. The GfK report warned that private consumption will not contribute towards Germany's recovery, which is grim news for the eurozone. One of most eagerly waited eurozone releases is the German inflation report, which will be released on Thursday. The consensus estimate for German CPI stands at 4.6% y/y, compared to 6.4% y/y in August. If the estimate is on track, it would mark a significant win for the ECB, which has been raising rates aggressively in order to curb high inflation. The ECB raised rates last week, but the lead-up to the meeting was dramatic as it was a 50-50 call whether the ECB would hike or hold. A sharp drop in German inflation could send the euro lower as it would support the ECB taking a pause at the October meeting. The week wraps up with German retail sales on Friday. After back-to-back declines, retail sales for August are expected to rebound to 0.5% m/m. The US releases third-estimate GDP on Thursday, with a market consensus of 2.0%. This follows the second-estimate of 2.1% and the preliminary estimate of 2.4%. The US economy has recorded respectable growth figures despite the Federal Reserve's sharp tightening, as the labour market has remained strong and consumers continue to spend. EUR/USD is testing resistance at 1.0594. Next, there is resistance at 1.0666 There is support at 1.0544 and 1.0472
by OANDA
British pound loses ground after mixed jobs reportThe British pound is in negative territory on Tuesday. In the European session, GBP/USD is trading at 1.2470, down 0.31%. Will the real UK labour market please stand up? The UK labour market is showing signs of weakening, while at the same time wage growth grew at a record pace, according to today's employment release. The economy shed 207,000 jobs in the three months to July, compared to a 66,000 fall a month earlier and weaker than the consensus estimate of -185,000. This was the sharpest loss of jobs since September 2020. The unemployment rate ticked up to 4.3% up from 4.2% and matching the consensus. The data is a clear sign that the labour market is cooling, but wage growth excluding bonuses rose 7.8%, unchanged from a month earlier and the highest on record. Wages are growing faster than consumer inflation, which rose 6.8% in July. The sharp rise in wage growth will provide support for the hawks who favour pushing rates higher in order to curb inflation. The Bank of England has been non-committal about next week's meeting, although Governor Bailey said last week that the BoE was "much nearer" to ending the current tightening cycle. That may indeed be the case, but the markets have priced in a rate hike at the September 21st meeting at close to 80%. Investor focus will now shift to UK GDP which will be released on Wednesday. After a respectable gain in June of 0.5%, the markets are bracing for a decline of -0.2% in July. A contraction in growth could extend the pound's losses. GBP/USD is testing resistance at 1.2471. Above, there is resistance at 1.2519 There is support at 1.2395 and 1.2322
by OANDA
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Canadian dollar steady ahead of jobs reportThe Canadian dollar is steady on Friday in what should be a busy day. In the European session, USD/CAD is trading at 1.3670, down 0.12%. Canada releases the August job report later today, with the markets braced for a decrease of 6,400 in employment. The US dollar has been on a tear against the major currencies since mid-July. The Canadian dollar has slumped, losing about 450 basis points during that span. The Canadian economy hasn't been able to keep pace with its southern neighbor, and that was made painfully clear as GDP contracted by 0.2% in the second quarter, below expectations. The deterioration in economic growth is a result of a weak global economy as well as the Bank of Canada's steep tightening cycle. After back-t0-back increases, the BoC opted to pause at this week's meeting and held the benchmark cash rate at 5.0%. Governor Macklem likes to use the term "conditional pause", which means that a break from rate hikes will depend on economic growth and inflation levels. At this week's meeting, the BoC's rate statement was hawkish, warning that inflation was too high and not falling fast enough. This was a signal that the door remained open to interest rate increases. Macklem was more explicit on Thursday, stating that further rate hikes might be needed to lower inflation and warning that persistently high inflation would be worse than high borrowing costs. The markets are more dovish about the BoC's rate path, given that the economy is cooling and the central bank will be wary about too much tightening which could tip the economy into a recession. The markets have priced in a 14% probability of a rate hike at the October meeting. USD/CAD is testing resistance at 1.3657. The next resistance line is 1.3721 1.3573 and 1.3509 are providing support
by OANDA
USD/CAD rises to 22-week high, BoC decision loomsUSD/CAD is trading quietly in Europe at 1.3651, up 0.06%. I expect to see stronger movement in the North American session, with the Bank of Canada making its rate announcement and the US releasing the ISM Services PMI which is expected to show little change. The Bank of Canada is virtually certain to hold rates at today's meeting, with just a 6% probability of a rate hike, according to the TMX Group. That would leave the benchmark cash rate at an even 5.0%. BoC Governor Macklem would certainly like to call it quits on the central bank's aggressive tightening cycle and perhaps he can look for advice from his peers at the Federal Reserve and the Reserve Bank of Australia. Both the US and Australian economies have seen inflation fall significantly, but Jerome Powell at the Fed and Peter Lowe at the RBA have sent the markets a hawkish message that inflation isn't beaten and the door is open for further rate hikes if necessary. The markets have taken a more dovish stance and are already looking ahead to possible rate cuts. Macklem appears to face the same challenge of acknowledging that rate hikes have cooled the economy and curbed inflation while sounding credible about keeping open the option of further rate hikes. Last week's GDP report indicated that the economy contracted by 0.2%, compared to the BoC's forecast of 1.5% growth. The BoC has hiked repeatedly in order to lower inflation but there are concerns that the rate hikes in June and July may have tilted the risk toward a recession. The Federal Reserve is widely expected to pause at the September 20th meeting. The pause could signal that rates have finally peaked, although don't expect any Fed members to publicly state that the rate-tightening cycle is over. Federal Reserve Governor Christopher Waller said on Tuesday that the Fed can afford to “proceed carefully” with rate hikes, given that inflation has been falling, and if the downtrend continues, "we are in pretty good condition". USD/CAD tested resistance at 1.3657 earlier. The next resistance line is 1.3721 1.3573 and 1.3509 are providing support
by OANDA
Why Silver stands out.In the ever-evolving landscape of global economics, precious metals like silver, often serve as key indicators and safe havens. This week, we'll explore the factors making silver an interesting prospect in today's market. Current Macroeconomic Indicators: The latest Consumer Price Index (CPI) data indicates a slight increase in the US for July, registering at 3.2%, up from the previous month's 3%. Predictive models from the Reserve Bank of Cleveland suggest an impending rise for the August CPI. Concurrently, the Reserve Bank of Atlanta's GDPNow model projects a rise in GDP figures. Silver, Inflation & GDP: The above becomes important when historical data reveals that significant spikes in silver prices often follow periods of simultaneous rises in GDP and inflation. Notably, in years that saw increases in both indicators, silver recorded gains of 38% and 46% in 2009 and 2020, respectively. Conversely, 2002 saw a modest 2% return. Silver vs. Gold: A measure of relative value between the two major precious metals via the ratio of Silver to Gold, further substantiates the idea of a potential strength in Silver. The ratio is trading just off a trend support-turned-resistance and at the upper end of the symmetrical triangle. Resistance here can play out in the format of silver strengthening relative to gold. Yields and Silver: The longstanding inverted relationship of yield and silver can be observed in the chart, but the ratio provides some insights into the limits of this relationship. What’s immediately obvious to us post 2008 there has been a regime change in this relationship as yield grinded lower and silver remains elevated. With no immediate large catalyst on the horizon, it is likely the current regime will hold and hence, the ‘floor’ in this relationship is near. Meaning relative to current levels of yield, Silver is trading on the lower side. Equities vs ‘real’ economy: Beyond being a precious metal, silver's industrial applications—from automotive to solar panels and electronics manufacturing—make it a bellwether for the 'real' economy, akin to copper. Comparing the Nasdaq 100 against industrial metals illustrates a disparity between equities and the 'real' economy, positioning silver as significantly undervalued relative to peers like copper and gold. Positioning: Current market positions, particularly among net Non-Commercials, seem to favor silver with a growing bullish sentiment. Technical Analysis: A noteworthy observation is the persistence of the 22.5 level as a pivotal support and resistance mark for silver, a trend tracing back to the 80s. Prices currently thread above this level and remain supported by an uptrend that began in August 2022. Additionally, RSI points to oversold, and in the past 4 instances when RSI reached such levels, prices quickly rebounded thereafter. Against the above factors, we see support for Silver, on multiple fronts, such as economic cycle, relative value against equities, and underpriced when compared against gold. Hence, to express our view on Silver, we can set up a long position on the Silver Futures at the current level of 22.67 with a stop at 21.8 and take profit at 25.10 . Silver prices are quoted in U.S. dollars and cents per troy ounce and each 0.005 move is equal to 25 Dollars. The charts above were generated using CME’s Real-Time data available on TradingView. Inspirante Trading Solutions is subscribed to both TradingView Premium and CME Real-time Market Data which allows us to identify trading set-ups in real-time and express our market opinions. If you have futures in your trading portfolio, you can check out on CME Group data plans available that suit your trading needs www.tradingview.com Disclaimer: The contents in this Idea are intended for information purpose only and do not constitute investment recommendation or advice. Nor are they used to promote any specific products or services. They serve as an integral part of a case study to demonstrate fundamental concepts in risk management under given market scenarios. A full version of the disclaimer is available in our profile description. Reference: www.cmegroup.com www.atlantafed.org www.clevelandfed.org
COMEX:SI1!Long
by inspirante