Forex Trading Review Guide: August 2022

Wednesday, August 31, 2022

Mini DAX Futures (FDXM1!), H4 Potential For Bearish Drop

Type: Bearish DropKey Levels:Resistance: 13341Pivot: 13011Support: 12422Preferred Case:On the H4, with price moving within a descending channel and below the ichimoku indicator, we have a bearish bias that price will drop from the pivot at 13011 where the pullback resistance is to the 1st support at 12422 where the swing low support, 61.8% fibonacci projection and 161.8% fibonacci extension are.Alternative Scenario:Alternatively, price could break pivot structure and rise to 1st resistance at 13341 where the overlap resistance and 50% fibonacci retracement are.Fundamentals:Since Russia's Gazprom said that a new turbine halt will further cut gas to Germany, it creates additional supply worries and we have a bearish view on the DAX index .

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EURCHF : ECB Member Hawkish Comment Lifts EUR

EURCHF has extended its 0.9551 rebound this week to 0.9775. The gains follow the release of German Consumer Price Index data showing that annual consumer price inflation hit 7.9% for August, higher than market expectations for a decline of one percentage point. The monthly CPI figures and the Harmonized Index of Consumer Prices or HICP (monthly and yearly) all remained unchanged, indicating that the European Central Bank’s (ECB) earlier rate hike did not dampen consumer price gains. The data is preliminary, with the final results to be published on September 13. However, it remains close to 50-year highs.

German inflation data pushed the 10-year bond yields to a 2-month high and strengthened the euro rate differential. The EUR found support from falling nat-gas prices which eased concerns about the energy crisis, after European nat-gas prices fell more than -7% on Tuesday to a 1-week low.

With energy prices 25% higher in August 2022 than a year earlier, the ECB has limited room to raise interest rates when it meets next week to decide the direction of Eurozone monetary policy. However, ECB Chief Economist Lane said the ECB needed a “steady pace” of raising interest rates in the fight against record inflation to minimize negative consequences, while ECB Governing Council Member Vasle said “we haven’t seen the highest inflation figures in the Eurozone yet,” and that he expected inflation to be high until it peaks in the next quarter before easing in the first half of 2023. Kazaks, said a significant rate hike is needed in September. He argued that the ECB should be “open to discussing possible 50bp and 75bp moves.”

Eurozone HICP inflation hit 9.1% y/y in the preliminary reading for August. Another higher than anticipated number and yet another record high. More importantly perhaps, core inflation jumped to 4.3% y/y, which is adding to warnings that inflation is becoming more broad based. Inflation differentials are also drifting apart and with headline rates running far over 20% in some countries, it won’t be enough to bring inflation down to prevent broader based knock on effects, as the erosion of real disposable income and the rise in cost pressures is too much to absorb lastingly. The numbers will give the hawks sufficient ammunition to force a debate of a 75 bp hike next week, which will put pressure on the dovish camp to at least back another 50 bp hike.

Technical Overview

The EURCHF pair attempted to bounce off its lows and in Tuesday’s trading a break of the 0.9700 resistance lifted the price close to the 0.9800 resistance. The intraday bias tends to the upside in the short term, while a move above 0.9800 opens doors for another test of 1.0000 parity.

Meanwhile a move below 0.9700 will confuse the outlook and the price will return to neutral. As long as the 0.9551 support holds, the price move could test the 50% and 61.8% retracement levels at 1.0031 and 1.0142, respectively. Broadly speaking, the pair is still in bears’ control, a price swing is possible if in the medium term, a rebound can overcome the resistance level of 1.0513 (June high price).

Meanwhile, the EURGBP pair extended its August gains by recouping losses incurred in July. The pair continues its rally for the 3rd day since Friday with Tuesday’s trading gaining +0.67% and trading in the 0.8590 price range.

Click here to access our Economic Calendar

Ady Phangestu

Market Analyst – HF Educational Office – Indonesia

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

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Market Spotlight: Eurozone Inflation Hits Record Highs

Eurozone CPI Soars AgainEuropean asset prices have come under fresh selling pressure today in response to the latest eurozone economic data. Headline August CPI was seen hitting a fresh record-high of 9.1% when compared with the same month a year earlier. This marks an increase from the prior month’s 8.9% reading and surpasses analyst forecasts for a 9% reading. Core CPI was similarly strong at 4.3%, up from 4% a month prior, again topping forecasts for a 4.1% reading. This latest data underpins just how entrenched the inflationary uptick has become in the eurozone, putting greater pressure on the ECB ahead of the upcoming September rates meeting next week.Looking at the breakdown of the data, energy and food costs remain the biggest drivers of upside, rising 38.3% a d 10.6% respectively. The ECB has recently changed its tone, focusing much more on inflation as a persistent threat rather than a temporary factor. This was reflected in the ECB’s decision to hike rates by .5% in July. Traders are now bracing for a potentially even larger hike next week when the central bank meets.Technical ViewsDAXFollowing the rejection at the latest test of the bearish trend line from YTD highs, the market has turned sharply lower with price now once again trading below the 13067.45 level. With both MACD and RSI bearish, while price holds below here focus is on a test of the YTD lows at 12462.59, a break of which opens the way for a much deeper move towards 11590.13 thereafter.

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ETHUSD, H4 | Potential Bearish Drop

Type: Bearish DropKey Levels:Resistance: 1654.99Pivot: 1559.47Support: 1421.24Preferred Case:On the H4, with price moving below the ichimoku indicator, we have a bearish bias that price will drop to pivot at 1559.47 where the overlap support is. Once there is downside confirmation of price breaking pivot structure, we would expect bearish momentum to carry price to 1st support at 1421.24 where the swing low support, 61.8% fibonacci projection and 161.8% fibonacci extension.Alternative Scenario:Alternatively, price could rise to 1st resistance at 1654.99 where the pullback resistance, 100% fibonacci projection and 78.6% fibonacci retracement are.

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GBP Breaks Down Further As Dark Clouds Gather

GBP Grinding LowerThe British Pound is back under heavy selling pressure again this week, extending its recent run of losses as a stronger US Dollar continues to weigh on GBP. The currency has been one of the worst performing this year, weighed on by a number of issues, many of which look set to keep price anchored lower across the remainder of the year.Perfect StormIt’s been something of a perfect storm for GBP with the fallout of the Russia-Ukraine war, ongoing COVID disruptions, Brexit-linked difficulties, surging inflation, tighter monetary conditions and political uncertainty each combining to send investor sentiment plummeting.Gas Price NightmareIn terms of the greatest risks to the UK currently, rising gas prices (and their inflationary knock-on) are taking the lead as winter approaches. With news this week that Russia has temporarily suspended its Nordstream gas supply to Europe for three days (for maintenance), fears of further disruption in the coming months are likely to keep gas prices at elevated levels.Inflationary SpiralThe UK economy is already reeling from the inflationary surge of the last six month and there are fears over how households will manage the winter months, given the spike in energy prices. The surge in energy costs has been one of the driving forces behind the record uptick in inflation in the UK. CPI was seen hitting 10.1% last month, putting extra pressure on the BOE to hike rates further. Current rates market pricing suggests BOE rate hikes will top out at 4% next year, suggesting higher rates in the UK than in the US.UK Growth Forecasts FallingHowever, the BOE’s tightening program is taking a toll on UK growth forecasts. Given the political uncertainty we are seeing currently amidst the change in Tory leadership, these fears are driving capital out of the UK and elsewhere. Along with the BOE taking action against inflation, the government has been forced to provide support for those struggling with the cost-of-living crisis, particularly energy payments, via a new £37 billion package announced in May.Fiscal Stimulus A Double-Edged SwordBoth candidates in the Tory leadership race have announced plans for further measures later in the year given that energy prices are now running above the forecasts made in May. While this will no doubt be welcomed by UK households it might end up stoking inflationary fires, putting even more pressure on the BOE to hike more aggressively. With this in mind, the coming months will be key for the UK economy and GBP alike as the BOE attempts to navigate very tricky territory. As such, it will likely take a significant shift in the narrative and a healthy upside surprise to help lift the beleaguered Pound.Technical ViewsGBPUSDThe sell-off in GBPUSD this year has seen the market grinding lower within a clear bear channel. Despite attempts in July and early August to breakout, that rally quickly fizzled out and price has since broken down to fresh 2022 lows, trading below the 1.1764 level. With both MACD and RSI bearish, the focus is on further downside near-term with 1.1474 the next support level to note.

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Investment Bank Outlook 31-08-2022

Credit AgricoleEurozone inflation: August HICP preview and updateThe preliminary inflation data in August published so far –in Spain, Germany and Belgium –provided few surprises. All in all, YoY inflation continued to rise, in a broad-based way. In particular, food and core inflation are still increasing overall.Tomorrow, the inflation numbers for France, Italy and the overall Eurozone will be published. We expect Eurozone headline HICP at 9.1% YoY (+20bp from July) with core at 4.2-4.3% (+20bp as well). Our take is slightly above the Bloomberg median consensus(headline9.0%,core 4.1%). Incontrast,wehaveFrenchCPIat5.9%YoY,20bpbelow consensus. Core inflation at 4.2-4.3% –if our forecast is correct –would likely put a higher probability for a 75bp hike by the ECB (rather than 50bp) at next week’s monetary policy meeting.Beyond August, the main drivers for European inflation will remain the same in our view: (1) natural gas prices; (2) electricity prices; and (3)the degree of European governments’ intervention to cap energy prices. In this regard, multiple scenarios are possible. In particular, we currently assume that a structural reform of the European electricity market (so as to de-link electricity prices from natural gas) will take time. In turn, we expect that a myriad of measures taken at the country level (so as to take down energy prices for households) will continue to be implemented, in turn making inflation scenarios even more uncertain. In the near term, we expect further acceleration in core inflation by year-end, towards 4.5-4.7% YoY, before some easing materialises. That said, we still have core above 4% during the totality of H123. Bear in mind that wages will probably accelerate significantly in early2023,considering headline inflation above 10% in Q422.INGIndustrial production and retail sales improved in JulyIndustrial production rose unexpectedly by 1.0% month-on-month, seasonally-adjusted (vs -0.5% market consensus), following a 9.2% surge in June. Output forecasts for August and September also improved suggesting that solid production is likely to continue this quarter. By industry, automobile production and shipments improved. Keeping up with the production setbacks will normalise in a few months, but the solid gain for two consecutive months shows that the global supply bottleneck is fading and pent-up demand remains strong. Meanwhile, weak production of electronic components and devices suggests that global semiconductors are entering a downcycle for the second half of this year.Meanwhile, retail sales edged up 0.8% in July (vs -1.4% in June), which was also better than the market consensus of 0.3%. Household consumption remained strong despite the resurgence of Covid cases and high inflation. General merchandise and apparel fell, but more importantly, motor vehicles continued to rise firmly by 4.4% (vs 5.2% in June) for the second month in a row.

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Market Update – August 31 – Stocks & Oil tank, Yields rally

USDIndex – remains capped at 109.00 with support at 108.20 today. Tight JOLTS report adds to pressure for a 75 bp next month; Fed Fund Futures now sit at 68.5%. 2yr yields traded to 15 yr highs. AUD outperformed overnight.
EUR – German Inflation at near 50-yr highs, pressures ECB action and lifts EUR to 1.0033
JPY holds between 139.00 & 138.00 having breached 138.00 Monday.
GBP hit Pandemic era lows (March 2020) yesterday at 1.1620. Recovered 1.1675 now.
Stocks US stocks weak again (S&P500 -44.00pts (-1.10%) 3986). Under 4k & 24-day low & under 50-day MA. Energy & Tech stocks led the decline. Futs 4014 now.
Oil lost over 5% yesterday but has recovered; API inventories better than expected. Touched $90.50 yesterday up to $92.50 now.
Gold – crashed to from resistance at $1736 and trades at support ($1724) now.
BTC – tested Monday’s 33-day low ($19.5k) again yesterday, back over 20k now at 20.3k.

Overnight – Asian equity markets squeezed lower following weak Wall Street, European FUTS tick higher. NZD Strong Building Permits JPY Retail data also better than expected CNY PMI data beat but weaker than last month. Manufacturing (49.4) remains in contraction. German Import Prices and French CPI (m/m) weaker than expected. (1.4% & 0.4% respectively).

Today – German Import Prices & Unemployment, EZ CPI, Canadian GDP, US ADP & Chicago PMI, Speeches from Fed’s Mester & Bostic.

Biggest FX Mover @ (06:30 GMT) AUDUSD (+0.68%). Remains volatile, (100+ pip mover yesterday). Latest move; a rally from 0.6850 support to trade at 0.6900 resistance. MAs aligning higher, MACD histogram negative but signal line rising, RSI 56.00, H1 ATR 0.00128, Daily ATR 0.00823.

Click here to access our Economic Calendar

Stuart Cowell

Head Market Analyst

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Tuesday, August 30, 2022

Should I use a workplace pension or a SIPP?

Workplace pensions and SIPPs both have attractive qualities, but which one will produce the best returns of investors?

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Ignore the doomsayers - energy prices could fall next year

Forecasts suggest the energy prices will continue to spiral, but these projections could turn out to be a lot of hot air.

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Market Spotlight: Tesla Rally Fizzles Out Following Stock Split

Tesla Fails to Rally Following Stock SplitFollowing a decent recovery rally over recent months, Tesla shares have stalled over August and have settled into a tight range between 281.39 and 315.77. The company posted solid Q2 earnings and 50% of the year’s losses before momentum fizzled out. Last week, the company underwent a 3.1 stock split though the move failed to spur the fresh wave of demand the company was hoping for given that much of the rally had occurred prior to the well signalled move.Musk Focused on Self-Driving TechSpeaking at an energy conference in Norway this week, CEO Elon Musk declared that his main focus this year was on the group’s SpaceX starship program and readying self-driving car technology ready for roll-out in the US and Europe, depending on regulatory approval. Speaking at the event, Musk said: "The two technologies I am focused on, trying to ideally get done before the end of the year, are getting our Starship into orbit... and then having Tesla cars to be able to do self-driving. Have self-driving in wide release at least in the U.S., and... potentially in Europe, depending on regulatory approval."Technical ViewsTeslaThe rally off YTD lows has seen Tesla shares trading up as high as 315.77 before stalling. For now, while price holds above 281.39, the focus is on a continuation higher, with 363.61 the broader objective for bulls. Should we slip lower here, the next key support is at the rising trend line and 255.61 level.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/market-spotlight-tesla-rally-fizzles-out-following-stock-split"
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Market Spotlight: AUDJPY Breaking Out

AUDJPY Long TriggeredThe long idea issued in AUDJPY last week has now triggered on the break of 95.67, with price moving towards first target at 96.98. The rebound in risk sentiment this week, fuelled by a pause in the USD rally, has seen AUD trading with a better tone. The pair is also benefiting from the clear monetary policy divergence between the RBA and the BOJ. While the latter has reaffirmed its commitment to maintaining an easing presence in the market, the RBA has fully committed itself to pushing ahead with tightening as it battles inflation. As such, there is room for higher prices near-term.Keep An Eye OnThe current rally in AUDJPY is being fuelled by the pickup in risk sentiment as USD weakens from recent highs. With this in mind, look for a continuation of the current market dynamic to keep the pair supported while a pickup in USD is likely to slow the rally down near term. US consumer confidence data later will be key to watch, as will comments from Fed’s William who speaks. Traders will be keen to see how other Fed members judge the near-term outlook on the back of Powell’s comments last week.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/market-spotlight-audjpy-breaking-out"
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The IndeX Files 30-08-2022

Risk Sentiment Stabilises As USD Rally PausesGlobal equities benchmarks are seeing better demand on Tuesday following a tricky start to the week for most. An early rally in USD yesterday weighed on sentiment, driving global stock prices lower, before a reversal in the greenback allowed risk assets to stabilise and recover. The driver behind the initial action yesterday was the fall-out from Powell’s Jackson Hole Speech on Friday.Speaking at the Fed’s annual event, Powell poured cold water on the idea of a Fed pivot, cautioning that rates would likely need to stay at elevated levels for longer in order to battle inflation, which is expected to persist at excessive levels. The speech marked a sharp change-in-tone from last year when Powell wrongly judged that the inflationary spike would prove temporary.With market pricing swinging back in favour of a larger .75% hike in September, risk assets tumbled across the board on the back of the comments. However, since then we’ve seen some scaling back in USD upside, likely reflecting a short-term positioning adjustment ahead of Friday’s jobs data. For equities, the near-term outlook remains pegged to USD flows. If USD regains bullish momentum, equities are likely to move lower near term while a further pull-back in USD will allow for a fuller recovery in risk prices.Technical ViewsDAXThe failure at the latest test of the bearish trend line from YTD highs has seen the market reversing lower, breaking through key support at the 13067.45 level. With both MACD and RSI both bearish, the outlook remains skewed towards further losses while price holds below this level, putting 12462.59 on watch as the next key support.S&P 500The S&P has moved sharply lower following the test of the bear channel top. The reversal has seen price moving back inside the initial, corrective bull channel which formed during the initial recovery off YTD lows. While below the 4153.50 level, and with both MACD and RSI bearish, the focus is on a test of the bull channel low and 3910 support next. This is a key area and a break below here would be firmly bearish.FTSEThe FTSE is continuing its shallow correction from the latest test of the bear channel top and 7558.7 level. While both MACD and RSI are bearish here, the move lower has been laboured, suggesting that while the market holds above the 7362.6 level, the focus remains on a further push higher. Below that level, the next support to watch is 7213.9.NIKKEIThe breakout above the falling wedge pattern has stalled for now with price running into selling interest ahead of 29464.9 and reversing back under the 28356.6 level. With both MACD and RSI bearish, while below here the focus is on a test of the 27422.9 level next, ahead of a retest of the broken pattern top.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/the-index-files-30-08-2022"
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Daily Market update: 30 August 2022

Dollar pulls back off fresh 20-year highs as market prices in a more hawkish ECB.

Dollar Index

Monday’s London session proved to be a battleground won by the Dollar as it added to Friday’s gains, hitting levels last traded in September 2002. A Key driver in this exuberance is the ever-increasing probability of a 75-basis point rate hike as opposed to a 50-basis point rate hike at the next FED meeting in September. This in turn has caused yields to rise, with the 2-year yield hitting fresh 5-year highs near 3.5% and ultimately gave the dollar its appeal to continue its upward trajectory.

Technical Analysis: H4

In terms of market structure, last week saw the completion of the larger bullish continuation pattern in the form of the falling wedge type structure that found support from the 104.00 level and produced an impulsive wave that went on to revisit the 109.00 area last week Friday before setting a new high just under 109.50.

Intra-day Overview: Current price action in Monday’s trading session broke through the previous high and created fresh 20-year highs before retreating into the range finding support within the 108.00 range. Henceforth buyers could push the index to continue its bull run, or on the flipside, sellers could be well positioned at the fresh 20-year highs set in Monday morning’s London session and could challenge buy pressure.

Stocks

At the time of writing, US Stocks have continued to sell off since Friday’s hawkish comments signalled a longer period of sustained higher interest rates.

Dow Jones: Reacted by adding to the losses from last week by 0.07%.
S&P 500: Pressure continued and added to losses from last week by 0.11%.
Nasdaq: Was down on Monday by 0.49%.

Currencies

Euro:

Intraday overview: Price was buoyed by a pullback in the Dollar on Monday morning, which gave the Euro some impetus to claw back some of the losses made on Friday, retesting the upper end of the range at the 1.00291 area in the current bearish continuation structure.

Pound:

Intraday overview: The 1.16481 area was the floor that supported a pullback on Monday morning, as the Pound clawed back some of the losses from Friday. The Intraday high was set around the 1.17432 area.

Commodities

Gold:

Intraday overview: The $1 720 area was the floor that supported a pullback on Monday morning, helping Gold claw back some of the losses seen on Friday. The intraday high was set around $1 745.

Oil:

Overview: On the back of the Saudis’ comments around their inclination towards slowing down production, the price of Brent hit $100 and shows the possibility of geopolitical factors supporting the bullish momentum for now, while the current economic outlook, and central banks’ monetary policies, are supporting a bearish sentiment.

Bitcoin

In the wake of Bitcoin falling below the psychological $20 000 level, there could be more support around the corner as crypto adoption seems to be getting “a shot in the arm” with the Monetary Authority of Singapore considering implementing certain regulations around leverage when it comes to cryptocurrencies. This initiative is aimed to protect inexperienced consumers as opposed to banning the crypto market altogether.

Economic Calendar

Source: Investing.com

Click here to access our Economic Calendar

Ofentse Waisi

Market Analyst

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Investment Bank Outlook 30-08-2022

Credit AgricoleSell USDJPY IdeaThe biggest drivers of the USD/JPY’s rally remain the US-Japan short-term rates differential as well as the USD’s safe-haven with yield appeal. We doubt the exchange rate can continue to rely on these factors to keep driving it higher, however.US inflation has likely peaked along with commodity price inflation. There are also signs the US economy is beginning to feel the effects of the Fed’s rate hikes thus far. Following FOMC Chair Jerome Powell’s address at Jackson Hole, we are likely passed peak Fed hawkishness. We maintain our view that the peak in the USD will be marked by the peaks in US inflation and Fed hawkishness.We continue to expect UST yield curve inversion to act as a brake on USD/JPY’s upside as Fed overtightening risks build. The slowing in US growth in the coming quarters will lead to further UST yield curve inversion. Indeed, Fed hawkishness in the face of this slowing would feed investor concerns about Fed overtightening.The inflation driven by the weaker JPY as well as higher food and energy prices is spilling over into broad inflation. There are two ways Japanese policymakers can address these pressures –FX intervention and/or the BoJ slightly changing tack at its September meeting.The JPY’s safe-haven appeal will return with a slowing in global growth and as investors look for an alternative safe-haven to an overvalued USD and the EUR, which remains weighed down by the Ukraine crisis.We recommend selling USD/JPY at 138.45with a stop-loss at 142.50 and target a decline to 130.The biggest drivers of the USD/JPY’s rally remain the US-Japan short-term rates differential as well as the USD’s safe-haven with yield appeal. We doubt this appeal can continue for the following reasons:1.US inflation has likely peaked: our Inflation Strategist believes US headline inflation has likely peaked in Q3 and forecasts it to slow from 8.8% YoY in Q3 to6.4%YoYinQ4.Theimpact of the Fed’s rate hikes in curbing domestic demand as well as the retreat in commodity prices likely mean the peak in US inflation is behind us; 2.PassedpeakFedhawkishness:FOMCmembersareclearlyunitedinthe view the Fed has to stay the course in terms of raising rates aggressively to contain inflation and of the need to clearly communicate this message to the market. Indeed, FOMC Chair Jerome Powell’s address to the Jackson Hole Symposium removed any doubt in investors’ collective mind of the Fed’s resolve to lower inflation and we think this likely represents the peak in Fed hawkishness;3.Overtightening risk: investors will not ignore softer US growth indicators and the growing risk of the Fed overdoing its tightening. Indeed, our US economist expects growth to slow sharply over the coming quarters and skirt recession in late 2023. Our US rates strategist expects further inversion in the UST curve and forecasts a bottom in the UST 2s10s spread of -85bp. We continue to see that Fed overtightening risk represents a brake on USD/JPY upside as well as the key to the exchange rate’s sell off;4.Kurodaunderincreasingpressure to admit inflation is not temporary: Tokyo CPI data for July surprised to the upside and indicates acceleration in nationwide inflation as the two are highly correlated. Tokyo headline and ex- food inflation are well above the BoJ’s 2% target and accelerating and all three measures of inflation –headline, ex-food and ex-food-and-energy inflation –are already above the BoJ’s forecasts for the current fiscal year.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/investment-bank-outlook-30-08-2022"
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Netflix has plenty of life in it yet – here's how to trade the shares

Netflix still has plenty of scope for growth, says Matthew Partridge, and the shares are reasonably priced. Here's how to play the Netflix share price.

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Monday, August 29, 2022

Gold Futures ( GC1! ), H4 Potential for Bearish Continuation

Type: Bearish MomentumKey Levels:Resistance: 1778.2Pivot: 1740.8Support: 1709.5Preferred Case:On the H4, with price moving within a descending channel and below the ichimoku indicator, we have a bearish bias that price will drop from pivot at 1740.8 where the pullback resistance is to 1st support at 1709.5 where the 78.6% fibonacci retracement and 78.6% fibonacci projection are.Alternative Scenario:Alternatively, price could break pivot structure and rise to 1st resistance at 1778.2 where the swing high resistance is.Fundamentals:We have a bearish outlook on gold as a result of Powell's Hawkish Remarks about monetary policy at the yearly Jackson Hole Symposium.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/gold-futures-gc1-h4-potential-for-bearish-continuation29"
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US30USD, H4 | Potential Bearish Drop

Type: Bearish BreakoutKey Levels:Resistance: 32613.63Pivot: 31890.53Support: 30448.75Preferred Case:On the H4, with price breaking the ascending trendline and moving below the ichimoku indicator, we have a bearish bias that price will drop to pivot at 31890.53 where the pullback support, 100% fibonacci projection, 61.8% fibonacci retracement and 127.2% fibonacci extension are. Should price break pivot structure, we would expect bearish momentum to carry price to 1st support at 30448.75 where the pullback support is.Alternative Scenario:Alternatively, price could rise to 1st resistance at 32613.63 in line with pullback

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Daily Market update: 29 August 2022

Dollar on the front foot on the back of hawkish Jackson Hole comments by FED chair Powell

Dollar Index

The dollar index ended Friday’s trading session with some exuberance, closing at the 108.73 level following a sustained hawkish tone from FED chair Powell at the Jackson Hole Symposium. His message was consistent with the narrative that the FED isn’t quite done yet fighting off inflation and a possible recession. Which essentially means Americans are going to have to brace for more interest rate hikes and consequently slower growth in the economy and a weaker job market.

Technical Analysis:

In terms of market structure, last week saw the completion of the larger bullish continuation pattern (falling wedge) that found support from the 104.00 level and produced an impulsive wave that went on to revisit the 109.00 area last week. Considering current price action and how it is approaching the 20-year highs in the form of a smaller bullish continuation pattern (descending channel), it’s an increasing probability that price could continue beyond the 109.00 key level henceforth.

Stocks

On the back of the dollar strength, there was a selloff in US Stocks, with a 3% decline on the prospect of the FED remaining firm on a sustained period of further rate hikes.

Dow: Reacted to the statements by plunging 3% (just over 1000 points) on the day.
S&P 500: Reacted to the statements and fell by 3.4%.
Nasdaq: Being heavily linked to the technology sector, the Nasdaq is particularly more sensitive to interest rate hikes and reacted by falling 3.9%.

Currencies

Euro: EURUSD slipped back to below parity levels, closing the day at 0.99654.
Pound: GBPUSD closed the day retesting the weekly low at 1.17391 after hitting a session high at 1.1900.

Commodities

Gold: Remained pressured by Powell’s comments despite a momentary bounce earlier in the week, ending Friday’s session at the $1 738 mark.

Oil: The black gold remained resilient last week, closing the week buoyed by verbal intervention from the Saudis concerning the possibility of cutting oil production. This potentially lends credence to the idea that the Saudis are unable to tolerate a price below $90 a barrel at the present moment.

Bitcoin

The leading cryptocurrency broke through the psychological $20 000 mark as bears largely drove the market last week, seeing a 20% decline in a week from a high of $25 211.

An interesting sidenote going into September is that Bitcoin has produced a bearish market environment in price for each of the past four months in the year. It’ll be interesting to see how it performs going into the new month and the last part of the year.

Today – Speeches from ECB’s Lane, Fed Vice Chair Brainard.

Economic CalendarSource: Investing.com

Biggest Mover @ (06:30 GMT) NASDAQ (-3.9%). Dropped to 12387$ from 13206$.

Click here to access our Economic Calendar

Ofentse Waisi

Market Analyst

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EUR/USD Holds Parity, S&P500 Might Jump Soon

The currency pair EUR/USD remains in the supporting zone formed between the levels 0.9950 and 1.0000. This asset is likely to pull back, undergo correction, and jump, targeting the local downtrend. The downtrend is denoted by the blue line on the chart below.Oil is slowly approaching the resistance at the level of 107.50. It is likely to head north next week, and face resistance at the level of 107.50. Oil might even break the resistance and head further. So, let’s observe what the oil is about to do next.American stock index S&P500 is going down, targeting the supporting level of 3900.00 and uptrend, away from which it might potentially pull and jump.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/eur-usd-holds-parity-sp500-might-jump-soon"
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Three top-quality Japanese growth stocks to ride the recovery

Professional investor Nicholas Price of the Fidelity Japan Trust highlights three of his favourite Japanese growth stocks that should benefit from the country’s post-pandemic re-opening.

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A lesson for investors from a ill-fated silver mine

Mining methods may have changed since the industry’s early days, but the business hasn’t – digging ore from the ground and selling it at a profit. The trouble is, says Dominic Frisby, the scams haven't changed either.

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Friday, August 26, 2022

Why you should consider an offset mortgage – and what the best deals are

Interest rates on savings are pitifully low at the moment. But you can still put your money to work: get an offset mortgage. Ruth Jackson-Kirby explains what they are and picks the best deals on offer now.

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Events to Look Out for Next Week

Next week, with Jackson Hole out of the way, markets should have a clearer indication on 75 bps or 50 bps for September but also for the year end and the year ahead. All Central Bankers are expected to remain in hawkish mode and to continue to stress commitment to achieving goals via a front-loading approach. Concern over energy security and the jump in European gas and electricity prices will remain on tap. The agenda also sees NFP, and Inflation data from Canada, Europe and Switzerland.

Have a look at the most important events of the coming days in our usual weekly publication.

Monday – 29 August 2022

Tuesday – 30 August 2022

Consumer Price Index (EUR, GMT 12:00) – German CPI is expected to slowdown by 0.4% from 0.9% on a monthly basis.
CB Consumer Confidence (USD, GMT 14:00) – Consumer confidence is expected to fall to a 2-year low of 92.0 from 95.7 in July, versus a 1-year low of 105.7 in February. The expectations index is expected to rebound to 66.0 from a 9-year low of 65.3 in July. Confidence is being pushed down by soaring prices with supply chain disruptions, high mortgage rates, stock price weakness, the war in Ukraine, and the ongoing pull-back in the 2020-21 confidence lift from stimulus.
FOMC Member Williams Speech (USD, GMT 15:00)

Wednesday – 31 August 2022

HICP (EUR, GMT 12:00) – Eurozone preliminary HICP inflation expected at 8.6% after it was confirmed at 8.9% y/y in the final reading for July, in line with expectations, and up from 8.6% y/y in the previous month. Core CPI is seen unchanged at 4.0% y/y. That is double the ECB’s 2% limit, and highlights that price increases are not confined to energy and/or unprocessed food, but are becoming increasingly widespread.
FOMC Member Mester Speech (USD, GMT 12:00)
Gross Domestic Product (CAD, GMT 12:30) – The final annualiazed Q2 GDP for Canadian is expected to grow by 5.4% q/q from 3.1% q/q.

Thursday – 01 September 2022

Event of the Week – Non-Farm Payrolls (USD, GMT 12:30) – A 230k August nonfarm payroll increase is anticipated, after gains of 528k in July, 398k in June, and 386k in May. Payroll growth should slow through 2022 alongside reduced GDP growth, and the climb in the initial and continuing claims in August suggests downside payroll risk for the month. We assume a 25k factory jobs rise in August, after a 30k July increase. We expect the jobless rate to hold steady for second month at 3.5%. Hours-worked are assumed to rise 0.1% after the 0.4% gain in July, while the workweek ticks down to 34.5 from 34.6 in July. Average hourly earnings are assumed to rise 0.2%, after a 0.5% July gain, while the y/y wage gain should hold steady from 5.2%. In the last expansion, we saw a 3.5% peak for y/y wage gains in both February and July of 2019, before the pandemic-boost to an 8.0% peak in April of 2020. The ensuing strength in wage gains has allowed continued robust y/y increases into 2022, though the return of low-paid workers to the workforce is likely restraining wage increases.

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Andria Pichidi

Market Analyst

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Market Spotlight: Trading Jackson Hole Today

All Eyes on PowellAhead of Fed chairman Powell speech at the Jackson Hole Symposium later today, market expectations are leaning broadly in favour of a hawkish outcome. On the back of a hawkish set of July FOMC minutes and following hawkish commentary from other Fed members at the end of last week and yesterday, traders are expecting Powell to reiterate the Fed’s core message of pushing ahead with rate hikes until inflation is back at target.However, given that this message is baked into price action here, the bigger focus will likely be on Powell’s outlook for next year. The market is already anticipating a Fed slowdown on rates as inflation moderates into next year. The key thing here will be timing. If Powell is seen forecasting a quicker end to the current inflationary peak (and thus a quicker end to tightening), this will no doubt fuel a USD sell-off. Alternatively, if the Fed sticks to a view of inflation staying at elevated levels for longer, this should keep USD demand intact near-term.Where to Trade Jackson Hole?AUDUSDThe Aussie has been the strongest beneficiary of the recent patch of USD weakness and risk-on trading. If USD weakens on the back of today’s event, AUDUSD looks well poised to advance higher. The pair is currently carving out a potential inverse head and shoulders pattern. As such, bulls can look for a break of .7132 targeting .7278 initially and .7564 as a longer-term target.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/market-spotlight-trading-jackson-hole-today"
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Live Cattle Futures (LE1!), H4 Potential For Bullish Rise

Type: Bullish RiseKey Levels:Resistance: 143.975 Pivot: 141.950Support: 139.175Preferred Case:With the price moving above the ascending trendline and above ichimoku cloud, we have a bullish bias that the price may rise to the pivot at 141.950, which is in line with the 161.8% fibonacci projection and swing high to the 1st resistance at 143.975, where the previous significant swing high is.Alternative Scenario:Alternatively, the price may drop to the 1st support at 139.175, where the 23.6% fibonacci retracement and swing low are.Fundamentals:No key news.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/live-cattle-futures-le1-h4-potential-for-bullish-rise26"
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Market Spotlight: AUDJPY Looking To Breakout?

AUDJPY Bull FlagAUDJPY price action is looking interesting here. Following the latest peak in June, AUDJPY has been correcting lower within a bear channel, which can be viewed as a bull flag within the longer-term bull trend. With price well supported into the lows and now turning higher once again, the risks of an upside break are growing. Bulls can look for a break of the 95.67 internal highs targeting a move through YTD highs and up to 98.83 initially. More conservative bulls can wait for a break of YTD highs. Retail market is currently around 80% sort, reflecting plenty of scope for a fresh breakout here.Keep an Eye OnThe broader risk-on backdrop we’ve seen this week has helped lift AUD while weakening JPY through reduced safe-haven inflows. While this dynamic continues, we can expect the pair to continue higher near-term. With that in mind, today’s Jackson Hole event is the key. If traders sense any dovishness whatsoever from Powell, most likely with regard to next year’s outlook, then USD is likely to come off and risk markets will move higher, supporting AUDJPY.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/market-spotlight-audjpy-looking-to-breakout"
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US30USD, H4 | Potential Bullish Rise

Type: Bullish BreakoutKey Levels:Resistance: 34296.57Pivot: 33461.36Support: 32586.42Preferred Case:On the H4, with price moving along the ascending trendline and bouncing off the stochastic support, we have a bullish bias that price will rise to pivot at 33461.36 where the pullback resistance and 50% fibonacci retracement are. Should price break pivot structure, we would expect bullish momentum to carry price to 1st resistance at 34296.57 where the swing high resistance, 127.2% fibonacci extension, -27.2% fibonacci expansion and 78.6% fibonacci projection are.Alternative Scenario:Alternatively, price could drop to 1st support at 32586.42 where the pullback support and 38.2% fibonacci retracement are.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/us30usd-h4-or-potential-bullish-rise"
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FOMO Fridays: EURAUD Under Water

EURAUD Stands Out During Quiet WeekIt’s been a much quieter week for financial markets. Though do bear in mind I’m writing this ahead of today’s Jackson Hole event. Given the focus on Fed chairman Powell’s speech today, markets have been somewhat held hostage over the week. Still, there have been some interesting moves and as is always the case in FX, while one pair is sleeping, another pair is on the move. Chatting with traders ahead of the long weekend here in London, it seems the main move capturing attention has been the more than 2% drop in EURAUD which saw the pair breaking down to fresh 2022 lows. So, let’s take a look at what caused the move and, as ever, if you caught it? Well done! If you missed it? There’s always next week.What Caused the Move?Risk On Fuels AUD RallyThere have been two sides to this week’s move. The first, is the broad risk-on tone to markets which has helped lift sentiment in AUD. With USD softening over the early part of the week, risk assets across the board were seen higher. Given AUD’s link to commodities prices, the currency tends to outperform during pro-risk market phases. With equities and commodities prices rebounding firmly amidst the USD lull, AUD was seen as one of the strongest performers in FX this week. Additional stimulus in China helped feed into this narrative. Given China’s status as Australia’s largest trading partner, injections of liquidity there typically help lift AUD on expectations of increased demand for Aussie exports.EUR Under Pressure Over Growth ConcernsAlong with the rise in AUD this week, EUR has remained under pressure. Following last week’s heavy losses, the single currency was seen clinging to recent lows as investor attention was diverted elsewhere. Fears over the health of the eurozone economy amidst the ongoing Russia-Ukraine war are keeping sentiment anchored firmly to the downside. A hawkish set of ECB minutes mid-week did little to lift the currency, simply adding to the growth fears which are mounting on the back of a set of weaker-than-forecast Eurozone GDP figures this week. It will be interesting to see how the pair trades on the back of today’s Jackson Hole event which threatens to cause wide-spread volatility into next week.Technical ViewsEURAUDThe pair is currently testing below the 2022 lows around the 1.4330 level. With both MACD and RSI bearish here, and with the pair still within the broad bearish channel which has framed price action this year, the focus is on a break lower and a further move down towards the next big support at 1.3696.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/fomo-fridays-euraud-under-water"
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Investment Bank Outlook 26-08-2022

BNY MellonJackson Hole Conference Productivity FocusFederal Reserve Chairman Powell's breakfast speech this morning in Wyoming will be focusing on the main topic of the Kansas City Fed's Jackson Hole Economic Symposium: “Reassessing Constraints on the Economy and Policy”. Unleashing productivity growth will, in our opinion, take the driving seat in FX markets for years to come.In a world where inflation converged across the globe, FX market participants increasingly focused on current account imbalances and capital flows. Countries delivering faster domestic demand would, in turn, develop large external imbalances, which required capital inflows to balance external accounts. In this note we denote such currency valuation models Balanced Equilibrium Exchange Rates (BEER).While this backdrop remains the case, large inflation differentials will likely bring currency markets’ attention back to price dynamics and productivity. The idea that exchange rates adjust to make up for price differentials is quite intuitive. This is the backbone of the so-called Purchasing Power Parity currency valuation models (PPP).Nevertheless, price differentials may prevail for a while, warranting an additional factor to explain currency strength. Enter productivity growth. Countries able to produce the same quality goods and services more efficiently than others would therefore be able to sustain stronger exchange rates and/or higher inflation. As a result, an additional modeling framework helps explain FX valuation with factors such as terms of trade (ratio of export to import prices), foreign direct investment and labor productivity. We define such a framework Dynamic Equilibrium Exchange Rate (DEER). Countries in which productivity growth is collapsing will therefore need to deal with an expensive exchange rate, and perhaps also the risk of currency crisis down the road.In the chart below we calculate two simple BEER and DEER models for the USD. We define BEER misalignment as the real effective exchange rate adjustment required to close the external gap in the US's balance of payments. On the eve of the Great Financial Crisis, the USD’s BEER was overvalued by as much as 20%. According to this model, the USD is now 12.9% overvalued, as the current account deficit has been widening substantially since June 2018, from 1.8% of GDP to 3.9% of GDP now.The dark line represents a DEER valuation model that incorporates terms of trade, foreign direct investment, and labor productivity in the US. DEER misalignment is therefore the currency adjustment required to close the gap opened from excessive or lagging productivity growth. These factors explained a cheap USD in the 1990s and a subsequently expensive USD following the NASDAQ collapse and a dearth of business sector investment thereafter. The shaded area is the USD real effective exchange rate, which accounts for inflation differentials and trade-weighted exchange rates.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/investment-bank-outlook-26-08-2022"
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Daily Market Outlook, August 26, 2022

Daily Market Outlook, August 26, 2022 Overnight Headlines Jackson Hole Symposium Likely To Underline Current Fed Strategy Fed's Bullard: Inflation Likely To Be More Persistent Than Expected Fed's Harker: Would Like To Get Rates Above 3.4% And 'Sit For A While' Fed’s George Says It Has To Get Rates Higher To Slow Down Demand Decision To End ECB Reinvestments Takes Back Seat To Rate Hikes - RTRS US And China Close To Deal Resolving Impasse Over Audit Inspections China Greenlights $70bn-Plus In Infrastructure Bonds To Lift Economy China Newspaper Sees GDP Gain From Extra Infrastructure Stimulus Tokyo Aug Core Consumer Prices Rise At Fastest Pace In Nearly 8 Years Hottest Tokyo Prices Since 1992 Ramp Up Heat On BoJ Messaging RBNZ’s Orr Sees Central Banks Needing To Push Toward Zero Growth Oil Set For Weekly Gain On Tighter Supply Before Powell Speech Aus Stocks Lead Gains In Asia Ahead Of Powell’s Jackson Hole Speech China's A Shares Are Still Resilient Despite Recent Fall - Daily Dell Revenue Growth Slows On Strong Dollar, China Lockdowns Bridgewater Sees Stocks, Bonds Dropping Up To 25% On Fed QTThe Day Ahead An announcement has just been made on Ofgem’s energy price cap which is set to rise to £3,549 from £1,971 on 1st October. With wholesale gas prices still rising further increases are being forecast for early 2023 with some predicting the price cap could move above £5,000 by April. Reports suggest that the Conservative Party leadership candidates are discussing possible support measures for both households and businesses. Some reports say that a package could be announced in the second week of September soon after the new UK PM is confirmed. Meanwhile, the latest German consumer confidence measure fell to a record low on the back of higher energy prices. Today’s US Federal Reserve policy symposium has been eagerly awaited by markets. The event is primarily an opportunity for central bank policymakers to meet with economists and discuss a key topic of the day. This week’s theme is “Reassessing constraints on the economy & policy”. Typically, of most immediate wider interest are the comments of Fed Chair Powell who is scheduled to speak at 3pm BST. Last year, Fed Chair Powell said that inflationary pressures were temporary - a comment that he later had cause to regret. This time markets will be looking for signals on the size of the probable US rate hike in September, indications of whether he thinks inflation has now peaked and what evidence he and his colleagues will want to see before ending monetary tightening. The likelihood is that his message will be hawkish, highlighting that not only do they want to see a fall in headline inflation but are equally focused on whether domestic inflationary pressures - such as the tight labour market – have settled. Today’s data calendar outside the US is light with nothing of note in the UK. In the Eurozone, July M3 money supply data will be watched for any signs of the effects of the recent pivot in monetary policy. In the US, the Fed’s preferred inflation measure (the personal consumption expenditure deflator) is expected to confirm the message from the CPI data that inflation fell modestly in July but is still well above target. Consumer spending is expected to have risen modestly in July, while the trade deficit in goods is forecast to be little different from June. Citi month-end FX model points to EUR buying and JPY selling Fixed income indices have seen renewed losses in August while equities have shown mixed performance, the bank says, where the MSCI US equity index is broadly unchanged in the month, but European equities are down and Japanese equities up. "The signals to buy EUR and sell JPY are driven by respective under and outperformance of local assets," Citi said, adding that "fixed income hedge rebalancing needs explain about 80% of the signal, which is unusual by historic standards." Citi says that its real money clients have been modest net buyers of JPY in recent days, suggesting no early rebalancing on the JPY sell signal. Flows into EUR have been positive, on the margin, in line with the model's signal - Source: CT NewsFX Options Expiring 10am New York Cut EUR/USD: 0.9850 (536M), 1.0000-10 (2.0BLN), 1.0050-55 (1.08BLN), 1.0150 (1.75BLN) USD/JPY: 135.00 (360M), 137.00-10 (1.3BLN) USD/CHF: 0.9755 (250M) USD/CAD: 1.2870 (226M), 1.2875-85 (524M), 1.2900 (210M), 1.3000 (350M)Technical & Trade ViewsEURUSD Bias: Bearish below 1.0250 Consolidation within 3 Day range ahead of Jackson Hole Today's event risk is FED Chair Powell Speech 3pm BST Close above 1.02 needed to end downside bias More than €2bn of 0.9850 put strikes due this Friday Monthly and weekly projected range support sited at 9830/50 20 Day VWAP bearish, 5 Day bearishGBPUSD Bias: Bearish below 1.2050 Bounce short lived and reversing into LDN – trend is lower below 1.2050 No domestic event risk today, all eyes on Jackson Hole Close above 1.2050 needed to relieve downside pressure Supported sited at 1.17 ahead of weekly projected range support at 1.16 20 Day VWAP is bearish, 5 Day bearishUSDJPY Bias: Bullish above 133.40 USDJPY bid and set to retest projected range resistance 137.50 Retail traders squaring books ahead of Jackson Hole event risk Japanese importers and retail will be looking to buy the dips, likely close to 135.60 Dealers expect more chop ahead of more US data, Fed Jackson Hold meet 20 Day VWAP is bullish, 5 Day bullishAUDUSD Bias: Bearish below .71 Consolidating yesterday's gains Further support from buoyant risk sentiment, caution ahead of Powell speech Resistance is at 0.7010 Testing 20 Day VWAP from below A break below 0.6850 would open the way to the trend low at 0.6682 20 Day VWAP is bearish, 5 Day bullishBTCUSD Bias: Bearish below 25.3K BTC continues to rotate within 22/21k range USD offered ahead of Jackson Hole event risk BTC supported by lower VWAP (20.9k) for now, then Jul 13 low 18.9k Res Aug 21 high 21.8k, 22.1k, 23k's 50% Fib of 25.2-20.7k Aug 28's 22.2k may pull BTC higher 20 Day VWAP is bearish, 5 Day bearish

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/daily-market-outlook-august-26-2022"
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Market Update – August 26

USDIndex – back in demand ahead of Powell at Jackson Hole and as markets speculated on 100 bps in ECB hikes by October, though it recovered some to finish at 108.64.
EUR – Remains under parity. German GfK consumer confidence plunged to -36.5, which could keep Euro underpinned.
JPY has lifted to 137.00, GBP steady below 1.1800.
AUD fell 0.4% below the psychological level of $0.7 & NZD fell 0.5%, giving up some of the strong gains in the previous day. The AUD has been performing better against the battered European currencies.
Stocks: US stocks are in the red with concern over aggressive tightening and a rise in yields capping gains (USA100 rallied 0.41%, with the USA500 up 0.29%, and the USA30 0.18% higher). Nikkei and ASX are up 0.8% and 0.5% after a strong close on Wall Street. GER40 and UK100 futures have lifted 0.4% and 0.3% respectively.
Oil slumped by about $2 a barrel on the possible return of sanctioned Iranian oil exports and on worries about the impact on fuel demand from rising US. Down to $92.08.
Gold – bounced from support at $151.80 to $1758.70.

Today – US PCE, Michigan Consumer Sentiment, Jackson Hole Symposium and Fed’s Chair Powell Speech.

Biggest FX Mover @ (06:30 GMT) NZDUSD(–0.45%). Dropped to 0.6195 from 0.6250. MAs aligning lower, MACD histogram negative & signal line falling, RSI 36.74 & dropping, H1 ATR 0.00089.

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Andria Pichidi

Market Analyst

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Neom megacity: Saudi Arabia’s vision of the future

The kingdom is building a futuristic city in the desert, a key component of its plan to wean the economy off oil and woo tourists and global businesses. Could it work?

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Thursday, August 25, 2022

On the Road to Jackson Hole!

Treasury yields have been choppy in early action awaiting Chair Powell’s speech Friday. There was little reaction from the GDP or claims data though the marginal boosts to growth and consumption in GDP, and the tightening in claims did weigh at the margin. Bonds had already pared their earlier gains after comments from the KC Fed’s George who indicated the FOMC will have to move rates up into restrictive territory, possibly over 4% and hold there in order to bring down demand.

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Stuart Cowell

Head Market Analyst

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MICRO DAX Futures (FDXS1!), H4 Potential For Bullish Rise

Type: Bullish RiseKey Levels:Resistance: 13781Pivot: 13383Support: 13004Preferred Case:With the price breaking the descending trendline and DIF line is crossing above the signal line in MACD , if the price could break the pivot at 13383, we could have a bullish bias that the price may rise to the 1st resistance at 13781, where the 78.6% fibonacci retracement and swing highs are.Alternative Scenario:Alternatively, the price may drop to the 1st support at 13004, where the 61.8% fibonacci retracement and overlap resistance are.Fundamentals:The German Final GDP q/q is higher than the expectation.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/micro-dax-futures-fdxs1-h4-potential-for-bullish-rise25"
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The Crude Chronicles - Episode 150

Oil Traders Re-Build LongsThe latest CFTC COT institutional positioning report shows that crude traders increased their net long positions last week from around 210k contracts to roughly 214k contracts. While not a huge increase, the adjustment does at least put an end to the weeks of reductions we’ve seen in upside bets. This change has been well reflected in price action this week with crude oil failing to continue the recent downward trend and instead reversing higher.Mixed Backdrop For OilThe backdrop for oil remains tricky with the market still caught between opposing forces. On the one hand, the ongoing supply disruption caused by the Russia-Ukraine war, in terms of oil output but also global distribution, is keeping prices supported. With gas prices soaring back to highs over the last week, oil has seen fresh demand as consumers and businesses turn towards oil usage to avoid the price peaks in gas. Additionally, the uptick in global travel, along with the summer driving season in the US, has also had a bullish impact on crude prices, lifting the demand outlook.Recession Fears Still Weigh However, there are still mounting concerns over a potential global recession over the remainder of the year. China has been scrambling to add stimulus over the last two-weeks as data releases there continue to highlight economic weakness. Furthermore, news of fresh lockdowns in China this week are also hurting sentiment. Oil prices suffered sharply during the Shanghai lockdowns earlier in the year and, with fears of further, major lockdowns later in the year, oil traders are wary of the impact on demand.OPEC Production Cut ChatterThe latest headlines around OPEC have helped lift oil prices this week. Comments made by the Saudi Arabian energy minister earlier in the week suggested that OPEC might look to ease off on production once again in a bid to help lift ailing oil prices. While the comments have not yet been confirmed by OPEC, given Saudi’s role as the group’s de-facto leader, traders have been happy to buy oil on the back of the comments.EIA Reports Further DrawdownThere was further good news for crude bulls from the EIA this week. The group reported a larger-than-expected drawdown of 3.3 million barrels last week. This was beyond the 2.5 million barrel drawdown forecast. Despite the better news on headline inventories, gasoline stocks were virtually unchanged, suggested slowing demand from the US driving season as summer winds down.Technical ViewsCrude OilThe reversal higher off the 85.53 level in crude has seen the market breaking out above the bear channel from YTD highs. Price is now testing the 95.93 level, which holds a strong of broken former lows. This is a key level for the market and a break higher here will open the way for a much fuller recovery. Failure here, however, keeps the focus on further downside near-term with 85.53 vulnerable.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/the-crude-chronicles-episode-150"
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Which is best – buy-to-let or shares?

Buy-to-let property used to be a great investment, but it’s no longer a sure-fire way to make money.

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Daily Market Outlook, August 25, 2022

Daily Market Outlook, August 25, 2022 Overnight Headlines Asian Markets Gain, Investors Anxious For U.S. Rate Hike Clues Hedge Funds Build Biggest Bet Against Italian Debt Since 2008 Dollar Eases From Near Two-Decade Peak As Jackson Hole Looms Global Stocks In For A Chilly Winter, Strategists Say - RTRS Poll Nvidia Forecasts Sharp Drop In Third-Quarter Sales As Games Drag Bank Of Korea Raises Key Interest Rate To 2.50% From 2.25% As Exp NZ Retail Sales Decline For The Second Quarter In A Row - StatsNZ Japan Sees Economy Picking Up Modestly, Flags Looming Risks BoJ’s Kuroda Would Hold Policy Even If Inflation Hits 3%, Survey Shows German Ifo Biz Conf Set To Continue Decline As Prices Trend Higher Government Bonds Sell Off On Higher Interest Rate Expectations Global Bond Inflows To Emerging Asia Signal Shift In Outlook - Oil Prices Rise On Potential OPEC+ Cuts; BP Shuts U.S. Refinery Units White House Continues To Call On Refiners To Increase Output Salesforce Falls As Revenue Forecast Misses Analysts’ Estimates Amazon Plans To Shut Down Primary Care And Telehealth ServiceThe Day Ahead Asian equities are up overnight possibly supported by the economic support package announced by China. The 19-point plan includes additional stimulus for infrastructure, property, energy, and agriculture, estimated to be worth around Yuan 1trn. Meanwhile, the oil price has continued to climb from recent lows with Brent crude touching above $102bbl its highest since late July. The August German IFO survey will provide a timely update on economic conditions. So far this year it has showed a small fall in the assessment of current conditions and a much bigger decline in expectations. Given ongoing concerns, not least about rising energy prices, a further decline in both components is expected today. The UK’s CBI retail survey will be an unofficial indication of August sales. Last week’s official release for July showed a rise in sales for only the second time in the last nine months. However, given the concerns about the squeeze on spending power from high inflation it will be no surprise if this month does not see another increase. In the US, the Q2 GDP release is a second reading. The first outturn showed a second consecutive quarterly decline. The update is not expected to be revised significantly although some forecasters are forecasting a modest upward revision. The weekly jobless claims data will provide a timelier reading on labour market conditions. New claims are above the lows seen earlier this year, but they are nevertheless still low by historic standards. So overall they continue to suggest that the market is tight. The minutes of the ECB’s July policy meeting, when interest rates were raised by a more than expected 50 basis points, will be watched for clues on the size of the expected second hike in early September. The ECB faces a similar dilemma to many other central banks with the inflation data arguing for aggressive action whereas the activity indicators point to the need for more caution. Nevertheless, markets think that a second successive 50bp hike is the most likely outcome. The US Federal Reserve’s annual economic symposium at Jackson Hole starts tomorrow. The full agenda will be released overnight but we already know that Fed Chair Powell’s speech, which is the thing most likely to impact on financial markets, will be at 3pm BST on Friday.FX Options Expiring 10am New York Cut EUR/USD: 0.9950-55 (1.24BLN), 1.0000-10 (2.7BLN), 1.0020 (280M), 1.0090-00 (1.05BLN), 1.0145-55 (970M) USD/JPY: 135.75-85 (499M), 135.90-00 (760M), 136.256-30 (300M), 137.00 (633M) GBP/USD: 1.1820 (574M) USD/CHF: 0.9600 (302M) AUD/USD: 0.6945-50 (482M) USD/CAD: 1.2850-55 (700M)Technical & Trade ViewsEURUSD Bias: Bearish below 1.0250 Bid in Asian the session, position squaring ahead of Jackson Hole Today's event risk comes from ECB minutes Close above 1.02 needed to end downside bias More than €2bn of 0.9850 put strikes due this Friday Monthly and weekly projected range support sited at 9830/50 20 Day VWAP bearish, 5 Day bullishGBPUSD Bias: Bearish below 1.2050 Bounce continues to relieve oversold signals – trend is lower below 1.2050 No domestic event risk today Close above 1.2050 needed to relieve donside pressure Supported sited at 1.17 ahead of weekly projected range support at 1.16 20 Day VWAP is bearish, 5 Day bullishUSDJPY Bias: Bullish above 133.40 USD/JPY off from monthly projected range resistance 137.50 Retail traders squaring books ahead of Jackson Hole event risk Japanese importers and retail will be looking to buy the dips, likely close to 135.60 Dealers expect more chop ahead of more US data, Fed Jackson Hold meet 20 Day VWAP is bullish, 5 Day bearishAUDUSD Bias: Bearish below .71 Opens higher as USD eases and commodities firm Further support from first equities Resistance is at 0.7010 Testing 20 Day VWAP from below A break below 0.6850 would open the way to the trend low at 0.6682 20 Day VWAP is bearish, 5 Day bullishBTCUSD Bias: Bearish below 25.3K BTC pushes further from pivotal 21k USD offered ahead of Jackson Hole event risk Higher Fed rate view no boon for cryptos; J-Hole summit Aug 25-27 in focus BTC supported by lower VWAP (20.9k) for now, then Jul 13 low 18.9k Res Aug 21 high 21.8k, 22.1k, 23k's 50% Fib of 25.2-20.7k Aug 28's 22.2k may pull BTC higher 20 Day VWAP is bearish, 5 Day bullish

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Market Update – August 25 – USD Slips, Stocks Gain – Jackson Hole Ahead

USDIndex – another volatile day – down from 109.00 declined to 108.20 after mixed Durable Goods & more Housing Data. – Jackson Hole in focus.
EUR – Remains weighed by energy crisis and record high GAS prices. German GDP helps a lift back to 1.000, but in 4th day below this key level.
JPY holds between 137.00 & 136.00 having failed to breach 137.00 yesterday.
GBP also weighed by energy crisis & widening strike action.Trades at 1.1850 with 1.1800 now support.
Stocks US stocks gained into close. (S&P500 -12.00pts (+0.3%) 4140) – Biggest movers – Peloton & BBBY (+20 & +18%) ; Revlon & Nordstrom (-11% & –20%). Nvidia -4.56% After hours following Earnings miss.
Oil continued to rally, more chatter of OPEC+ production cuts, BP closing refineries due to fires and a big fall in inventories. Up 0.5% over $95 to $95.60.
Gold – bounced from support at $1736 and $1745 and trades at $1758.
BTC – over 21-21.5K range at 21.6k.

Overnight – Asian equity markets recovered after nine days lower, European FUTS also higher. NZD Retail Sales Miss significantly (-2.3% vs. 1.7%), JPY SPPI misses (2.1% vs. 2.2%) German Final Q2 GDP a tick better at (0.1% vs. 0.0%).

Today – German Ifo, US GDP (2nd), PCE Prices Prelim, Jackson Hole Symposium, ECB, CBRT & Banxico Minutes.

Biggest FX Mover @ (06:30 GMT) AUDUSD (+0.88%). Rally from 0.6850 & 0.6900 support continues, trades at 0.6975 now. MAs aligning higher, MACD histogram positive & signal line rising, RSI 73.60 OB & rising, H1 ATR 0.00137, Daily ATR 0.00823.

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Stuart Cowell

Head Market Analyst

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