Sterling rises to almost 10-week high versus dollar

from Forex News https://www.investing.com/news/economy/sterling-rises-to-almost-10week-high-versus-dollar-2735490
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The best low cost index funds for 2022

Index funds are an easy, low-cost way for investors to invest in a sector or asset class. Saloni Sardana picks six of the best low-cost index funds to buy now.

from Moneyweek RSS Feed https://moneyweek.com/investments/funds/604317/best-low-cost-index-funds-to-buy
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Dollar Edges Lower After Powell Promises Inflation Won't Become "Entrenched"

from Forex News https://www.investing.com/news/forex-news/dollar-edges-lower-2735429
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EURGBP – Drops to Two-Year low

EURGBP, Daily

The December Eurozone Preliminary Inflation Estimates continued to record higher above the ECB’s 2% target for the sixth month, at 5% from the 4.9% seen in November, compared with forecasts of 4.7%. Energy prices once again saw an increase of 26% per year. The key Core CPI data remained at 2.6% above estimates for a slight cooling to 2.5%. The data, released on Friday, added to the already heavy EURGBP pair.

The Eurozone’s economic confidence index for December was at its lowest since May, at 115.3 from November’s 117.6, in line with consumer confidence. December dropped to a nine-month low of -8.3 and service sector sentiment in December dropped to a seven-month low of 11.2 from 18.3 seen the previous month.

EURGBP has started to decline significantly since the central bank’s policy meeting in mid-December, with the ECB planning to cut asset purchases under the PEPP program in the first quarter of 2022. It will continue its asset acquisitions under the APP program at €40 billion in Q2 and €30 billion in Q3, while the BoE side surprised the market by raising interest rates to 0.25% from 0.1%.

With the ECB and BoE divergence in policy trend, the EURGBP pair is heading for a test of the two-year low zone of 0.8280 if it can break through the previous week’s low of 0.8334, while a retracement to the low zone of 0.8280 in the short-term is necessary to stand above the 0.8370 zone first to test the next resistance at the MA50 line around 0.8450.

Will the price be able to make a new low into a two-year low test? The answer may lie in today’s Eurozone November Unemployment Rate Report, which was inline with expectations at 7.2%, slightly down from 7.3% the previous month. While the data refers to a period when Omicron hadn’t really impacted the recovery yet, survey data and more up to date German numbers for December indicate that the improvement in labour markets still continued as companies remain relatively optimistic about the medium to long term outlook. Rates remain very different across the major Eurozone countries, however, and youth unemployment rates remain unacceptably high, at 29.2% in Spain, 28.0% in Italy and 17.8% in France. Germany’s 6.4% rate is an exception and far below the Eurozone average of 15.5%, although even here there is an improving trend.

Click here to access our Economic Calendar

Chayut Vachirathanakit
Market Analyst – HF Educational Office – Thailand

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 written permission.

from HF Analysis /300713/
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Was Friday USD Decline a Correction? Rate Markets Suggest it was

Despite relatively upbeat NFP report, the dollar was down on Friday. This is somewhat surprising as the odds of a Fed rate hike in March rose after the report. If before the report, the chances were 66%, then on Monday they rose to 70%:Currently the markets price in three rate hikes in 2021. It is amazing because just a year ago, not a single rate hike was expected until 2024!December US inflation figures due on Wednesday may lend more credibility to the story of the Fed rushing to withdraw monetary stimulus, which is likely to help the dollar start attacking its opponents again.The US economy added 199K jobs in December, more than twice below the forecast of 400K. Nevertheless, wage inflation smoothed out negative effect of the headline reading as it rose by 0.6% MoM beating expectations. Given persistent wage pressures, weak jobs growth can be regarded as a persistence of imbalances in the labor market, namely strong demand for labor and a lack of its supply. This is also indicated by the stuck 62% labor force participation rate, which barely responds to the surge in new vacancies in the United States that started in 2021:December CPI report is expected to show broad inflation at 7% and core inflation at 5%. It is quite bold to expect a positive surprise given such forecasts for the world's first economy, but labor market dynamics remains powerful precondition for further inflation growth. The yield on 10-year bonds is approaching 1.8% and several Fed officials will speak this week, as well as the head of Powell for re-nomination for the post of FOMC chairman. In general, the dollar's upside potential, in my opinion, has not been exhausted this week, and Friday's downward movement should be regarded as a not quite planned correction.The EURUSD pair, despite the weakness of the dollar on Friday, remains in the range of 1.1180-1.1380. Markets are discussing a speech by Fed official Schnabel that the EU's transition to alternative energy sources will put pressure on inflation and force the ECB to revise its forecast. The next official inflation forecast for the ECB will not appear until March, so support for the Euro from this front will not appear soon. In the first quarter, talks about tightening the policy will mainly concern the Fed, so it is reasonable to give preference to the dollar, as for the dynamics of EURUSD in the first quarter.Technically, the two nearest resistance zones for EURUSD can be at 1.1380 and 1.14150 (the upper border of the range and trend channel): As for the GBPUSD, tomorrow's GDP report should strengthen the chances that the Bank of England will remain on a tightening trajectory and raise rates at its February meeting. Now the OIS markets are setting an 80% probability of such an outcome, and from this point of view, the pound retains the potential to strengthen, in particular against the Euro. The area of 0.8270-0.8280 looks like an attractive zone for EURGBP:

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/was-friday-usd-decline-a-correction-rate-markets-suggest-it-was"
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Market Spotlight: GBPNZD Breakout Hits Target

Beware Correction RisksThe breakout trade in GBPNZD from 1.9690 has now hit its target at 2.0064. With the retail market still firmly short the pair and with both MACD and RSI bullish, there is room for a continuation higher here. However, given the recent move and the current stalling at the resistance area marked, some correction is to be expected. For those looking to stay long, while the bull channel holds, the 2.0265 level is the next upside target for bulls.Keep An Eye OnIn terms of domestic data, a raft of GBP data due on Friday will be the main focus for UK traders. However, the key US releases over the week are likely to be more tone-setting. Should NZD remain under pressure, GBPNZD is likely to continue higher near term. However, should we see any shift in the current dynamic, that is likely to fuel a correction.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/market-spotlight-gbpnzd-breakout-hits-target"
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Precious Metals Monday 10-01-2022

Metals Higher Following Mixed US Labour ReportIt’s been a quiet start to the week for metals markets though both gold and silver are trading in the green over the European session so far on Monday. Friday’s US jobs report failed to deliver the USD upside that many were anticipating, creating some room for metals to rebound near term. The headline NFP number was seen far below expectations at 199k vs 426k expected. At that level, the number was also lower than the prior month’s 249k. Aside from the miss on the headline reading, the rest of the report was strong with the unemployment rate seen falling to fresh cycle lows at 3.9% and average hourly earnings rising back up to 0.6% on the month.While some are keen to spin the jobs number as a sign of the tightness in the labour market now, given that the labour market is still quite a way off the pre-pandemic highs, the release has left USD in a stifled condition. Looking ahead this week, the main focus will be on US CPI due on Tuesday. A solid release will reignite the focus on USD, likely weighing on metals near term. However, should CPI undershoot expectations also, this will likely be a catalyst for near-term sales in USD, suggesting that markets had become too hawkish in their expectations. In this scenario, there is room for metals to advance over the week as March rate hike probabilities would no doubt come down a little.Away from USD, the broader risk backdrop remains key to track. Equities markets are sitting lower against recent highs, reflecting the recent run up in central bank tightening expectations. While risk markets remain weak, metals are likely to continue to derive safe-haven support. Should equities continue lower near term, this is likely to remain broadly supportive for gold though silver might suffer a little as a result of the lack of demand from industrials.Technical ViewsGoldFollowing the rejection at 1826.71 and the subsequent move back below the rising trend line from 2021 lows, gold has since found a bid and is now fighting to move higher. With both MACD and RSI bullish, the focus is on a break of the 182671 level and a continuation higher towards 1871.04 next.SilverFor now, silver prices are sitting back on the 22.3105 level support. With price holding around the middle of the bearish channel and with MACD bearish, there are risks of a continuation lower here with a break of the 21.4523 level opening the way of for a move down to 19.5643 and the channel low. To the topside, bulls need to clear the 24.0073 mark (and channel high) to cause a shift in sentiment.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/precious-metals-monday-10-01-2022"
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What can the “January barometer” tell us about 2022 stockmarket prospects?

How the stockmarket performs in the first month of the year can often have a bearing on its performance for the remainder. Max King looks at what it’s telling us about its prospects for 2022.

from Moneyweek RSS Feed https://moneyweek.com/investments/investment-strategy/604315/january-barometer-stockmarket-indicator-2022
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Market Update – January 10 – Cautiousness ahead of US CPI

Inflation worries and the Fed’s hawkishness prompted buying in shares like banks that usually perform well in a high interest rate environment, while high-growth stocks were routed. Share markets made cautious gains so far today as US jobs report giving the greenlight to investors to counted down to another US inflation reading that could well set the seal on an early rate hike from the Federal Reserve, lifting bond yields yet further. Going from uber-accommodation in November liftoff as soon as March, multiple rate hikes in 2022, and subsequent balance sheet shrinkage in a matter of two months spiked Treasury yields. Volatility in stocks jumped as investors repriced for the new conditions.

The explosion in coronavirus cases globally also threatens to crimp consumer spending and growth just as the Fed is considering turning off the liquidity spigots, tough timing for markets addicted to endless cheap money. – Reuters

• USD (USDIndex 96.20) slips but holds gains supported by higher yields – 95.88 currently.
• US Yields 10-yr is coming off of its worst week in years thanks to the FOMC’s pivot to the hawkish side, and as government and corporate supply picks up. Key technical levels were also broken to exacerbate the selloff. It will be hard pressed to rally unless there are signs Omicron will take more of a toll on growth than currently anticipated, suggesting the FOMC will not need to boost rates as aggressively as feared.
• Equities – US equities closing in the red.  USA100 had struggled at the end of last week, but frayed nerves have started to calm – for now – USA100 at 15664.  USA500  at 50DMA below 4700. Tech stocks in Hong Kong rebounded, which saw the Hang Seng lifting 0.8%. Stock markets across Asia traded mixed, in quiet trade, with Japan on holiday today.
• USOil – held firm,sustaining last week’s gains at 78.70 
• Gold – at $1794.
• FX markets – EURUSD corrected to 1.1341 amid broader pressure on the Euro, USDJPY rebounded to 115.75, Cable steady at 2-month high  at 1.3590.

European Open –  The March 10-year Bund future is down -13 ticks, US futures are posting similar losses, as yields continue to rise against the background of rising inflation and easing virus concerns. GER40 and UK100 futures are up 0.2%, as stock market sentiment improved at the start of the week.

Today – Central bank outlooks and virus developments will remain the focus of attention this week, with investors likely to keep a close eye on upcoming Fedspeak. For today though the calendar is pretty light on both sides of the Atlantic with only Eurozone unemployment and US Wholesale inventories are scheduled.

Biggest FX Mover @ (09:30 GMT) CADCHF (+0.33%) Rallied to 0.7289 extending to Decmber’s highs. MAs aligned higher, MACD signal line & histogram well above 0 line. RSI 75 OB but still rising.

Click here to access our Economic Calendar

Andria Pichidi

Market Analyst

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 written permission.

from HF Analysis /300640/
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EURUSD : Week January 10-14

EURUSD, H4

EURUSD was up +0.55% on Friday on fears the record rise in Eurozone consumer prices will force the ECB to tighten policy sooner than expected. December EZ CPI rose a record +5.0% y/y (data from 2001), stronger than the expected +4.8% y/y. EURUSD also found support after EZ Nov retail sales unexpectedly rose +1.0% m/m, stronger than the expected -0.5% m/m and the biggest gain in 5 months. Stronger data boosted German bond yields and strengthened euro rate differentials as the 10-year German bond yield rose to a 2-1/2 year high of -0.036%.

This week’s data consists of level two and three releases that will have little effect on the central bank in the coming months. Pressure increased after inflation hit another record high in December. Traders will be looking for signs that policymakers will give in under pressure, despite being reassured until now that inflation is still temporary.

Morgan Stanley believes that the Fed rate hike will go quite smoothly, while other central banks will switch from dovish to hawkish politics. This will lead to a convergence in the actions of regulators, putting pressure on the Dollar and driving up the EURUSD pair. This is in line with the views of Goldman Sachs strategists too.

EURUSD, H4

EURUSD, H4

The pair continued to struggle in sideways trading from December to last week and the outlook is unchanged. Initial bias remains neutral at the start of the week. On the upside, continued trading above December’s month high of 1.1385 which became resistance would lead to a stronger advance back to the 1.1444 price level (the descending trendline border) and a break of the trendline would bring gains to around 1.1600 support which would become resistance.

On the downside, a break of 1.1186 will erase the buyers’ strength and the price will resume a bigger decline from the 2nd peak of 1.2263 to the next target at 1.1000 near the 76.8%FR level.

Click here to access our Economic Calendar

Ady Phangestu

Market Analyst

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.

from HF Analysis /300654/
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Investment Bank Outlook 10-01-2022

Credit AgricoleAsia overnightThe rise in the UST 10Y yield to nearly 1.80% post the US non-farm payrolls data modestly weighed on sentiment during the Asian session. Adding some weight to sentiment were newswire reports of the first omicron variant cases of Covid in Mainland China. At the time of writing, a modest majority of Asian bourses were trading higher. S&P500 futures were trading slightly in the green. The USD made a modest comeback during the Asian session, but a short squeeze led to the AUD being the strongest performer in the session and the EUR and JPY being the weakest performers in the session.CitiEuropean OpenRipples were present in the markets following a strong jobs report from the US last Friday. DXY ticked higher during the Asia session as a treasury futures slide provided a USD boost, even as cash markets were closed for Japan’s Coming-of-Age Day. G10 was mostly in the red by a tad, although there were little in the way of notable moves. Potential use of Article 16 is on the table according to comments from UK Foreign Secretary Liz Truss on Sunday, should talks with the EU on Northern Ireland fail. Reports on Saturday highlighted the potential emergence of a “Deltacron” strain, although we note that scientists have speculated about the findings being a result of an error.USDA post-payroll follow-through seen in rates markets as Fed rate expectations drive. Treasury futures opened lower and extended losses, now testing Friday’s lows. Despite cash markets closed due to Japan’s Coming-of-Age Day, volumes are running roughly in line with recent averages. The curve is bear flattening with 10y yields implied higher by ~3bps which puts cash bond yields around 1.79%. The belly of the curve is leading the weakness with Eurodollar futures lower as selling flows emerge in greens, with more Fed tightening being priced in.CIBCFX Flows$YEN found bids near 115.50, some chatter by one reporter that they are linked to gamma play but I belief part of the bids are linked to retail day traders, they have been short and should be reducing their positions. I am certain they will add to shorts above 116.00. In terms of FX options, there are more than $3bn worth of 116.00 strikes and about $2.5bn of 115.50 strikes due this week.AUD$ gained on back of AUD¥, small resistance ahead of 0.7200, stronger at 0.7280, a tough level to breach, tried several times and failed. Mild data released this morning, Melbourne Institute inflation expectations slightly lower than previous month, not a market mover. Tomorrow we will have November trade data, trade surplus little lower from previous month at A$10.6bn. November retail sales is also expected to be lower at +3.7% from +4.9%.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/investment-bank-outlook-10-01-2022"
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Three biotech stocks to buy now

Professional investors Ailsa Craig and Marek Poszepczynski of the International Biotechnology Trust pick three of their favourite biotech stocks to buy now.

from Moneyweek RSS Feed https://moneyweek.com/investments/stocks-and-shares/share-tips/604296/three-biotech-stocks-to-buy-now
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Ruble Is Volatile, EUR/USD Might Drop Soon!

Good day,The Russian ruble has reached the level of 77. Currently, this asset is about to target the level of 78, which is located right next to the downtrend from the weekly chart. Therefore, the price of currency pair might reverse and drop. The asset’s price is likely to pull from the resistance at the level of 78.00, and head south. По паре EUR/USD у нас оформился треугольник с верхней горизонталью 1.1380, к которому сейчас активно подходят цены. Базовый сценарий – отскок от горизонтали вниз. Важный момент! Если перейти на недельный таймфрейм единой валюты, там чётко просматривается сформировавшийся, красивый вымпел: Нефть залетелаобратно в диапазон, оформленный границами 77.82 и 86.70. Учитывая, что"чёрное золото" сейчас в середине обозначенного нами диапазона,базовый сценарий такой – отскок от верхней или правой границы, в зависимости оттого, куда котировки прибегут раньше:

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/ruble-is-volatile-eur-usd-might-drop-soon"
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Dollar Up, Investors Look to U.S. Inflation Data for Fed Rate Hike Clues

from Forex News https://www.investing.com/news/forex-news/dollar-up-investors-look-to-us-inflation-data-for-fed-rate-hike-clues-2734175
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