Daily Market Outlook, August 9, 2022

Daily Market Outlook, August 9, 2022 Overnight Headlines NY Fed: Inflation Expectations Decline Across All Horizons US Dollar Loiters Off Highs As Traders Eye Upcoming CPI Citi: Fed Could Approve 100 Bps Rate Hike After Jobs Shocker EU Puts Forward 'Final' Text To Resurrect Iran Nuclear Deal UK Retail Sales Growth Fails To Keep Pace With Soaring Inflation UK PM Rejects Calls For Emergency Measures On Cost Of Living Crisis China Unlikely To Cut Interest Rate And RRR – Securities Daily Australian Consumer Sentiment Slides As Rates Rise Further Australia Business Activity Booms In July, Costs Continue Surge Oil Prices Retreat On Potential Chance Of Iran Supply Boost Wall Street Strategists Say Stocks Rally At Odds With Profit Outlook Asia Stocks Wobble As Focus Turns To US Inflation Data, Fed Outlook Google Hit By Worldwide Outage As Users Report Search Engine DownThe Day Ahead Asian equity market performance is mixed overnight with no major moves. A US Federal Reserve survey showed that both near-term and longer-term inflation expectations have fallen. The move seems to have been primarily driven by the recent fall in oil prices. A spokesperson for UK PM Johnson said that whether further fiscal support will be given to offset the latest rise in the energy price cap will be up to the new prime minister. The latest British Retail Consortium report showed retail sales up 1.6% yr-on-yr in July, boosted by sales of hot weather clothes and other items to combat the heatwave. The rest of today’s economics calendar is light with nothing of note in either the UK or the Eurozone. Indeed, the schedule for the whole week is sparse until Friday when UK GDP and Eurozone industrial production will provide updates on economic activity. There are also no scheduled speeches from either Bank of England or European Central Bank policymakers as we move into the main holiday period. However, with the Conservative Party leadership contest continuing there will be interest in what the two candidates have further to say about their economic policies and in particular any plans they have to offset the likely impact on consumers of the energy price cap rise expected in October. In the US, the key release of the week will be tomorrow’s update for CPI inflation. Ahead of that, today’s releases are forecast to show a big fall in productivity in Q2, due to the combination of falling GDP and strong employment and a resulting large rise in unit labour costs. Those outturns are likely to reinforce US central bank policymakers’ concerns that inflationary pressures are not yet under control. Meanwhile, the NFIB small business survey for July may provide insights into trends in a key segment of the economy. Already released results to some of the questions show a small rise in hiring plans but a slight easing in the jobs vacancies ‘hard to fill’ component, while compensation plans were unchanged. The latest Chinese inflation data will be released early tomorrow. The July results are expected to show a rise in annual consumer price inflation to 2.9% from 2.5% but a fall in producer price inflation. The expected acceleration in consumer price inflation would take it to its highest since April 2020 and will likely be primarily driven by food prices. However, the big picture is that inflation is still well below trends in much of the rest of the world, which suggest that the government still has room to stimulate economic growth.FX Options Expiring 10am New York Cut EUR/USD: 1.0000 (1.06BLN), 1.0100 (799M), 1.0145-50 (926M) 1.0185-90 (1.69BLN), 1.0200-10 (1.69BLN), 1.0225-30 (380M) 1.0260-65 (320M), 1.0300 (1.27BLN) USD/JPY: 133.00 (570M), 133.40 (679M), 134.50 (210M) 135.00-05 (975M), 135.30-40 (1.43BLN) EUR/GBP: 0.8350 (210M) USD/CAD: 1.2750 (325M), 1.2875 (470M), 1.2900 (1.17BLN) 1.2920 (223M)Technical & Trade ViewsEURUSD Bias: Bearish below 1.0350 Opens unchanged as market looks ahead to US CPI EUR/USD opens unchanged around 1.02 after a quiet Asian session USD eased against some currencies due to a move lower in US yields EZ bond yields also fell to offset and cap EUR/USD gains Resistance 1.0250/60 stronger offers seen to 1.0350/60, support 1.0100-05, 1.0070-75 20 Day VWAP is neutral/bearish, 5 Day bullishGBPUSD Bias: Bearish below 1.2280 Heatwave fuels spending, but likely transitory Opens steady after closing up just 0.05% after a choppy inside day UK shoppers spend as heat-wave hits - likely transitory BRC Cost of living crisis likely to be the main focus as rates rise and colder weather comes Offers sited at 1.2280/1.23 bids 1.20 20 Day VWAP is bullish, 5 Day bearishUSDJPY Bias: Bearish below 135 USDJPY supported by expectations of larger Fed interest rate hikes Fed funds futures price in 69% chance of another 75 bps rate hike in Sept NY Fed survey shows US consumers' inflation outlooks drop sharply, caps rise Inflation expectations are a key dynamic for Fed policymakers Bears target a test of 130 Offers seen at 136.20 20 Day VWAP is bearish, 5 Day bullishAUDUSD Bias: Bearish below .7050 Bulls have the ball, ignore inflation data risks AUD/USD rallied overnight, NY opened near 0.6965, rally extended Equity , copper gains & softer US yields aid lift US July CPI risk looms, downside surprise may squeeze shorts Offer at .70 being eroded as price is accepted above .70 bulls target .71 test AUD/USD support now sited at .6890 20 Day VWAP is bullish, 5 Day bullishBTCUSD Bias: Bearish below 25.3K BTC capped at 24k for now Thieves stole an estimated $190 million from U.S. crypto firm Nomad last week Seventh hack of 2022 to target an increasingly important cog in the crypto machine: Blockchain "bridges" Bulls need a close above 25k to gain significant upside momentum Closing below 21k would be a noteworthy downside development 20 Day VWAP is bullish, 5 Day bullish

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Earning Season: The Walt Disney Company

The Walt Disney Company, which has a capitalization of 194.2B, is the world’s largest American media and entertainment conglomerate operating streaming services, movies and theme parks globally. Disney plans to report its earnings report for Q3 2022 (Disney’s fiscal year begins in October of each year) on Wednesday, August 10 after the market closes.

Zacks positions Disney Rank #3 (Hold) in the Top 40% position #103/252 of the Media Conglomerate industry. For this report, an EPS of 0.87–0.94 (+17.5% y/y) is expected, although there are speculations that it could reach $0.99 with a -7.70% ESP. A profit of 21.12B is expected, which would be a year-on-year growth of 24.06% compared to 17.02B last year. The estimate has had 3 upward revisions and 1 downward revision in the last 60 days. The company beat estimates in 3 of the last four quarters only disappointing once, while surprise EPS averaged +89.11%. Disney boasts a P/E ratio of 27.15 and a PEG ratio of 1.28.

Last quarter the company reported EPS of $1.19, up 37% y/y, and revenue of $19.2B, up 29% y/y.

One of the main factors to take into account for this report is the continued growth of subscribers for Disney+, which has become one of its main profit drivers. The platform has not stopped increasing its subscribers since the start of the service in November 2019, thanks to the pandemic that affected online entertainment and its extensive portfolio of exclusive content, currently with an estimate for this Q3 2022 report of 148,703M subscribers globally, up 28% /y and up 7.99% from 137.7 million subscribers in Q2 2022, a new historical maximum that is expected to be broken in this report. On the other hand, Disney+ recently reported that it added several countries in the Middle East and North Africa in its portfolio where the service is offered.

Disney+ is in position #3 of Streaming Services, behind Amazon Prime with 205M subscribers and Netflix with 225M. Disney+ is expected to overtake these based on growth in the coming years.

Streaming Marvel movies on Disney+ is a reliable revenue generator and key element of subscriber retention. The recent Marvel movie Dr. Strange in the Multiverse of Madness grossed $185M in the US alone, which made it the second highest-grossing film of the year. However, in contrast, the most recent film, Lightyear, failed to meet box office expectations grossing only $50.6M vs. $70M expected.

 

Number of Disney+ subscribers: Source:https://www.statista.com/statistics/1095372/disney-plus-number-of-subscribers-us/

Disneyplus.com had a total of 521.5M page views in April (146.1M), May (159.5M) and June (215.9M). 25.7% of visitors were in the United States followed by the United Kingdom with 9.4% and Canada with 6.29%. The age range of 18-34 years formed more than 60% of the total. The page has 987,000 visitors daily with daily ad revenue of $80k. The value of the website amounts to $700,900,000.

Web traffic by device – Source: https://www.semrush.com/website/disneyplus.com/overview/

On the other hand, the reactivation of theme parks will also be important for this report since it will reflect the benefit of the recovery that has taken place in recent quarters following their temporary closure due to the outbreak of Covid. The increase in the Dollar and gasoline will also be a headwind for theme parks outside and inside the US creating difficulty for international and national visitors to attend the parks.

Zacks estimates revenue from parks, experiences and consumer products at $6.71 billion, up +54.6% y/y and up +0.87% from Q2 2022. In other segments, last quarter Disney obtained 13,620M in Media and Entertainment, 7,116M in linear Network, 4,903M Direct to consumer, 1,866M from content sales, licenses and others.

Disney revenue by segment – Source:https://www.statista.com/statistics/1028537/quarterly-revenue-walt-disney-company-by-segment/

We cannot ignore the current world situation. The vertiginous increase in inflation and the already more palpable fear of a recession, together with the increase in the price of gasoline, has marked a change in the behavior of consumers who have stopped spending on non-essential things and increased capital for basic products. Consumers have stopped paying for cable and satellite TV in which Disney is one of the main payment recipients. Likewise, the world situation has reduced spending on advertising not only for Disney but for most companies in general, which also creates difficulty for the company. All of this has marked an underperformance this year, marking a more than 40% drop in its shares from its highs in 2021.

Technical Analysis – #Disney $109.17 (+2.33%)

On a weekly basis the price has fallen from its all-time high at $203.02 on March 21 for 16 months to the 88.6% Fibo at $93.18 with current lows at $90.22 from where it bounced back to the 20-week SMA at $108.51 currently under test. The last lows from where this current cycle started is at $79.05 in March 2020. The price recovered $100 3 weeks ago and has remained above it so far.

Resistance is at the psychological level and previous highs at $120.00, the 61.8% Fibo at $126.41. There is a “Death Cross” (which is unlikely to last long) with the 50-week SMA at $137.75 and just above the 200-week SMA at $139.45, 100-week SMA at $153.21 just shy of the 38.2% Fibo at $155.66. Regarding the supports, the low of the cycle is our support since 2014, if it is broken the price could have a strong fall to the psychological level of 50.00 and from there to the low of 2011 at $30.00.

Click here to access our Economic Calendar

Aldo Zapien 

Market Analyst – Educational Office – Mexico

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.

Sources:

1. https://www.zacks.com/stock/quote/DIS/detailed-earning-estimates
2. https://thewaltdisneycompany.com/app/uploads/2022/05/q2-fy22-earnings.pdf
3. https://www.statista.com/statistics/1095372/disney-plus-number-of-subscribers-us/
4. https://finance.yahoo.com/news/walt-disney-dis-report-q3-165204000.html
5. https://markets.money.cnn.com/research/quote/snapshot.asp?symb=DIStemp

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ETHUSD, H4 | Potential Bullish Continuation

Type: Bullish BounceKey Levels:Resistance: 1785.06Pivot: 1682.68 Support: 1648.56Preferred Case:On the H4, with RSI moving along an ascending trendline and price moving within an ascending channel as well as above the ichimoku indicator, we have a bullish bias that price will rise from pivot at 1682.68 where the pullback support is to the 1st resistance at 1785.06 where the swing high resistance, 127.2% fibonacci extension and 61.8% fibonacci projection are.Alternative Scenario:Alternatively, price could break pivot structure and drop to 1st support at 1648.56 where the overlap support, 50% fibonacci retracement and 100% fibonacci projection are.

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Pure Storage: More Upside Potential?

Pure Storage Inc. is an American technology company founded in 2009, which engages in developing all-flash data storage hardware and software products. Its technology has replaced traditional storage systems in the last few decades, namely mechanical disks, at the same time optimizing end-to-end for solid-state memory.

Fig.1: Reported Sales and EPS versus Analyst Forecast for Pure Storage. Source: money.cnn

The company is due to report its Q2 2022 earnings results in just over two weeks (25^th Aug). Nevertheless, in general it is doing an impressive performance compared to the previous year, with total sales hitting $2.2B in Q1, exceeding analyst forecast at $2.1B. Its sales jumped nearly 30% compared to those in 2020. This has resulted in an EPS of $0.72, three times higher than in 2020.

Pure Storage did not disappoint in the first quarter of 2022. Reported sales were $620.4M vs consensus estimates at $521.7M. EPS last stood at $0.25, far exceeding analyst forecast which were $0.04. According to the management, its commitment to sustainability (drive out direct energy usage in data storage systems by up to 80%), market-leading portfolio innovation (Pure Fusion and Portworx Data Services that allow customers to bring infrastructure and applications closer together with cloud-like automation and storage delivery for traditional and cloud-native applications; FlashBlade for Distributed Scale Out File Storage which is easy to use, consistent performance at scale and positive customer experience), and partnerships with a few companies like Snowflake, Kyndryl and even Amazon (AWS) are the keys for Pure Storage to be a leading pioneer in IT sector.

For the upcoming earnings announcement, the management has provided an optimistic guidance, with revenue expected to hit approx. $635M, while Non-GAAP operating income is expected to rise to $75M. Market consensus is positive too, with Sales expected to hit 636.2M, up 2.55% from the previous quarter and up 28.06% from the same period last year. EPS is expected to hit $0.22, slightly down from the previous quarter’s $0.25, but up 57.14% from the same period last year. According to Zacks Consensus Estimates, Pure Storage “boasts an average earnings surprise of 205.4%”. Perhaps Zacks’ findings such as solid earnings fundamentals, good VGM and momentum score, and a healthy financial condition in addition to factors listed in the previous paragraph are what makes Pure Storage an interesting candidate to check upon for the long term.

Technical Analysis:

#Purestorage remains traded above $29.21, or FR 50.0% which extended from the March high ($36.70) to May low ($21.72). $29.00 is the low estimate of analysts. The stock price has been on its gains for five consecutive weeks. If bullish momentum persists, the nearest resistance to watch is $31.00, followed by $33.50 and $36.70. On the other hand, if price breaks below current levels, the 100-day SMA will be challenged, followed by $27.45, $25.25 and $21.72.

Click here to access our Economic Calendar

Larince Zhang

Market Analyst – HF Educational Office

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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Daily Market Outlook, August 8, 2022

Daily Market Outlook, August 8, 2022 Overnight Headlines Daly: Fed Is ‘Far From Done Yet’ On Bringing Inflation Down Fed’s Bowman: Large Interest-Rate Rises Could Continue The Most Americans Since 2008 Say Economy Is Getting Worse US Senate Passes Tax, Climate Spending Deal To Revive Biden Agenda Italy’s Centre-Left Coalition Collapses Days After Agreement Japan Runs First Current Account Deficit In 5 Months Japan Bank Lending Picks Up On Demand To Meet Rising Material Costs New Zealand Posts First Dip In Inflation Expectations In 2 Years New Zealand Economists See Jobs Market Past Peak As Rates Rise China To Conduct 'Regular' Military Drills East Of Taiwan Strait Median Line China's Exports Gain Steam But Outlook Cloudy As Global Growth Cools Dollar Extends Gains Against Yen As Big Fed Hike Bets Ramp Up Oil Extends 10% Weekly Drop As Demand Concerns Spur Caution Iran, US Close In On Nuclear Deal Text But Hurdles Remain Asian Share Markets, US Futures Mostly Softer On MondayThe Day Ahead Having posted solid gains over the previous three weeks, global equities are now showing signs of cooling with Asian markets trading somewhat mixed at the start of the new week. Friday’s stronger-than-expected US payrolls report added to the case for further hikes in US interest rates, which in turn has provided a more cautious backdrop for risk assets. Sentiment across China has also been impacted by new Covid restrictions in parts of Hainan island. The province has reported a surge in Covid infections over the past week leading to a number of major cities being placed under lockdown. Markets have also remained on recession watch over the past week as they look for clues on how quickly and by how much economic activity is set to slow across a number of major economies. In the UK, the Bank of England’s Monetary Policy Committee delivered a downbeat message about UK economic conditions alongside its latest interest rate hike. The message from the BoE is that further hikes are likely despite their forecast that the UK economy is likely to enter a five-quarter recession later this year, alongside the prospect of the headline rate of CPI inflation exceeding 13% in October in response to the next energy price cap rise. This Friday’s UK GDP report may be seen as evidence that the UK economy is already in recession as we expect it to show a monthly fall in output for June of 0.9%, resulting in a quarterly decline in GDP across Q2 as a whole. However, the Bank of England is anticipating a decline and also expects a corresponding rebound in Q3, which is partly why it is not forecasting the recession to start until Q4. Until then, it is a quiet week for UK data reports, with no releases due today, although the early Tuesday release of the British Retail Consortium’s retail sales report for July will provide some first insights into Q3 trends. Elsewhere, it is also a very light day for key data with no major releases due in the US, while in the Eurozone the attention is limited to the latest Sentix investor confidence survey for August. A fall from -26.4 to -29.0 is expected, which would take it down to its lowest since May 2020CFTC DATA USD long pared considerably amid significant yen short – cover USD net spec long cut in Jul 27-Aug 2 period; $IDX -0.8% EUR specs +2,773 contracts now -38,811 amid EUR$ 0.45% rise JPY net short reduced considerably, $JPY -2.73%, specs +18,728 contracts GBP$ +1% in period; specs -2,419 contracts now -56,409; BoE rate path lags AUD specs -8,565 contracts now -55,950; growth woes, commod dip weighs on A$ BTC +9.73% in period, specs sell 460 contracts into strength, now -581 JPY short-cover changes USD long rankings- EUR short +$4.9bn, GBP$ short +4.3bn, $JPY long +$4.0bn (Source: Reuters)FX Options Expiring 10am New York Cut EUR/USD: 1.0100-05 (692M), 1.0175 (234M) 1.0200-05 (353M), 1.0245-55(423M), 1.0300 (567M) USD/JPY: 134.00 (445M), 134.75-85 (372M) 135.00 (510M), 135.50 (260M), 135.90 (230M) 135.90-00 (639M), 137.50 (960M) GBP/USD: 1.1990-00 (670M), 1.2240-50 (510M) USD/CHF: 0.9450 (300M). AUD/USD: 0.6910 (913M) 0.7000 (975M). NZD/USD: 0.6400 (330M) USD/CAD: 1.2800-10 (340M), 1.2950 (1.07BLN)Technical & Trade ViewsEURUSD Bias: Bearish below 1.0350 Soft as the resilient USD and Italian issues weigh -0.25% amid hawkish Fed expectations after strong U.S. jobs underpin the USD Italian centrists in disarray - right wing Gov't chances grow Moody's cut Italy's outlook to 'negative' from 'stable' Resistance 1.0250/60 stronger offers seen to 1.0350/60, support 1.0100-05, 1.0070-75 20 Day VWAP is neutral/bearish, 5 Day bearishGBPUSD Bias: Bearish below 1.2280 Surging U.S. jobs and hawkish weekend Fed comments to sustain USD strength Liz Truss ready to speed up tax cut plan if elected, Telegraph Lizz Truss is hot favourite to be next PM - oddschecker - bet 11 to win 12 Offers sited at 1.2280/1.23 bids 1.2090 20 Day VWAP is bullish, 5 Day bearishUSDJPY Bias: Bearish below 135 0.25% after jumping 1.54% Friday as Treasury yields surged E-mini S&P -0.5% - Hawkish Fed comments CME FedWatch Tool prices a 75bp September hike at 68% from 28% on July 29 Japan PM Fumio Kishida to reshuffle the cabinet on Wednesday Bears target a test of 130 Offers seen at 136.20 20 Day VWAP is bearish, 5 Day bullishAUDUSD Bias: Bearish below .7050 Dramatic hawkish shift in Fed expectations underpinning USD in early Asia Fed speakers on weekend indicate another 75 BP hike in Sept on the table Market pricing in a 70% chance of a 75 BP hike following the strong US payroll report Offer at .70 being eroded as price is accepted above .70 bulls target .71 test AUD/USD support now sited at .6890 20 Day VWAP is bullish, 5 Day bullishBTCUSD Bias: Bearish below 25.3K BTC responds positively to NFP Data Set to make another attempt at 24k Foundry Makes BTC Donation to Open Source Stratum V2 Protocol Developer to Improve Bitcoin's Proof-of-Work Mining Layer InvestDEFY Launches STACC, a Weekly Yield Enhancement Program for Bitcoin (BTC) and Ethereum (ETH) Bulls need a close above 25k to gain significant upside momentum Closing below 21k would be a noteworthy downside development 20 Day VWAP is bullish, 5 Day bearish

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Market Update – August 8 – USD holds post NFP bid

USDIndex sinks held onto NFP inspired bid trades at 106.40, from 106.80.  NFP big beat across the board; headline more than double expectations at 528K, June revised 26K higher, Unemployment fell (3.5%) and Earnings rose (5.2%) = pressure back on Fed for 75bp hike in Sept. Recession what Recession? US Stocks slipped led by tech. TSLA –6.6% (3-1 stock split 25/8), TWTR +3.56%, META –2.00%, LYFT +16.8% ($1bn profit expected 2024), AMZN -1.2% (to buy iRobot $1.7bn) Asian markets mixed (Hang Seng -1.02%, Nikkei +0.29%). European FUTS also mixed. Yields rallied (10yr 2.8287%)  Oil under $90, Gold under $1770  and BTC moved up to $23.5k.

Berkshire Hathaway posted $43.8 bn loss on stock market declines. MUSK wants TWTR deal to go ahead if they can prove the % of real accounts, wants public debate with TWTR CEO. FED’s Bowman “expects “more 75bp hikes”. CFTC Net Longs in USD reduced last week. Chinese exports hit record 5- mth high Trade balance back over $101 bn. Biden gets his $430bn Climate, Healthcare & Tax Bill through the Senate, China continues exercises around Taiwan for 5th day.

Week Ahead – Highlight will be US CPI on Wednesday which is expected to decline to 0.2% m/m and  8.7% y/y.

• USDIndex rallied to 106.80 post NFP holds at 106.45 now. YEN underperformed in Asian session.
• Equities – USA500 closed lower -6.75 pts (+-0.16%) (4145), US500FUTS at 4150 now. 4175 key resistance remains. S&P500 gained +0.4% for the week, NASDAQ +2.2%.
• Yields 10-year yield rallied into close. The 2/10 yr yield curve is now 40bp inverted. 30yr back over 3.00%.   
• Oil – declined to $86.96 Friday back to $89.60 now and renaims under $90.00. 
• Gold – topped at $1794 (50 day MA) in early Friday trades before tanking to under $1770. Trades at $1775 now, 20-day MA $1757.
• Bitcoin dipped to $22.7K Friday, before strong weekend rally, trades at $23.7k now.
• FX Markets – EURUSD down to 1.0177, USDJPY rallied 1.57% on Friday – trades at 135.50 now. Cable tested to important 1.2000 zone on Friday – recovered to 1.2080 now.

Overnight – JPY Bank Lending better than expected, but Econ. Sentiment sank to 43.8 from 52.9. NZD Inflation Expectations slipped to 3.07% from 3.29% & CHF Unemployment in-line at 2.2%.

Today – EZ Sentix Investor Confidence, Earnings from BioNTech, Barrick Gold, Porsche & Siemens Energy.

Biggest FX Mover @ (06:30 GMT) AUDJPY (+0.68%). Bounced from 92.50 support on Friday to test key resistance and 7-day high today at 94.00. MAs aligned higher,  MACD histogram positive and signal line rising, RSI 69.44 rising & testing OB, H1 ATR 0.192, Daily ATR 1.218.

 

Click here to access our Economic Calendar

Stuart Cowell

Head 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.

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Bitcoin is on the Rise, Oil Might Drop

Bitcoin is on the rise. The asset is about to undergo correction soon. Bitcoin should gain the required support at the level of 23400, which is located next to the uptrend and broken bullish flag.Gold has pulled from the downtrend, trying to drop. Gold is likely to pull back from the broken monthly downtrend denoted by the thick blue line on the chart.Oil broke the level of 94.55 and might drop. Although oil might also jump and form the bearish trap. So, let’s wait and see what is going to happen on Monday as this is going to be an important day for oil.

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Fear of missing out – what should investors do now?

Markets have rallied from their mid-June lows. But if you missed out, as most investors did, what should you do now? Max King explains.

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Where to find inflation-resistant stocks

Terry Smith’s latest update contains some valuable pointers for investors looking to protect against inflation.

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How to trace lost accounts and share in £50bn of unclaimed assets

Britons have amassed almost £50bn of unclaimed assets in lost accounts. Here’s what to do if you think some of the money may belong to you.

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A low-risk way to beat inflation

Demand for care-home places is strong and the sector should be able to raise prices ahead of costs, says Max King.

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Goldman Calls for Caution as Bull Market is yet to be Justified by Strong Economy

According to a note from Goldman Sachs onThursday, US equities are headed for another big sell-off if economic datafails to improve quickly to justify the latest leg of the rally.Goldman's Cecilia Mariotti noted that "Inthe absence of clear signs of positive macroeconomic momentum, temporaryincrease in risk appetite may actually increase the chances of another downturnrather than signaling the end of a bear market."The bank disappointed those investors who hopedthe 14% rally that kicked off in mid-June is the start of a new bull market,urging them to brace for another big sell-off if economic data doesn't showimmediate improvement.This is especially true if the almost two-monthrise in stock prices was driven by systematic traders rather than fundamentalinvestors, as traders can get out of long positions more quickly and move intoa bear market.But even subdued investor sentiment and traders'low equity exposure in 2022 are not enough for the market to reach asustainable bottom.Mariotti urges not to rushand wait for further developments in the macroeconomic situation, given thediscrepancy in the pricing of growth stocks compared to the still heightenedrisk for investors in growth stocks, which the market is likely to face in thesecond half of the year. She noted that the bank continues to prioritize adefensive portfolio allocation for 3 months before expecting a sustained turnin the market.

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July NFP Preview: “Bad News is Good News” Reaction is Highly Likely

The dollar retreated 2% from yearly highs and appears to be primed for a rally which could be triggered by the labor market report. However, the reaction of the US currency may prove to be asymmetrical - if Payrolls disappoint, the correction is likely to be shallow and short in time on the back of expectations of a possible upside surprise in US CPI next week. In addition, there should be a lot of attention on wages as weak job growth combined with a good pace of wage growth will be an indicator that labor supply cannot meet high demand, which means that the labor market will continue to generate inflation through wages, which will require maintaining a high pace of policy tightening.The volatility of major currency pairs continued to decline this week, and a good picture of the earnings season in the US combined with a couple of solid US macro reports fueled demand for risk assets. Demand for emerging market assets, in particular EM sovereign debt, has also revived, as one indicator that the search for yield is resuming. For example, Turkish bonds denominated in foreign currency showed good rally this week.Expectations for the Fed's terminal rate this year have stabilized at the level of 3.25-3.5% and are unlikely to change without a serious economic shock. And the Fed itself this week made verbal interventions that attempted to shift focus from the persistence of inflation and excessive concerns about a recession next year, hinting that the central bank is unlikely to deviate from the tightening course or move quickly to cut rates next year. The NFP report today, in general, should reinforce expectations that there will be no deviation from the previously outlined course of tightening. Employment is expected to rise by 250K, and wages by 0.3% in monthly terms and by 4.9% in annual terms. Any surprise higher in wages will mean the Fed will have to work hard to get inflation under control. And the risk of an unfavorable CPI report next week will also keep investors on their toes.Based on the arguments above, there appears to be few reasons for investors to dump greenback. In addition, the factor of pressure on the two key opponents of the dollar ‒ the euro and the yen ‒ will be a carry trade, due to lower interest rates than in the US, which will make them the currency of choice for the purpose of funding those trades.Analyzing preliminary data on the labor market for July, one can note an increase in the number of initial claims for unemployment benefits in July compared to June:The change in the number of open vacancies indicates some cooling in demand for labor, which also does not speak in favor of strong Payrolls:Challenger data shows US companies announced in July plans to cut roughly 25K jobs. This is the second highest this year, after a high of 32.5K in June:High Frequency Employment Indicators paint a mixed picture of employment dynamics, with Homebase seeing a 500K increase, while Google Mobility and Census Household Pulse data warned the economy is losing jobs:With market rallies fueled by low interest rates, or at least expectations that the Fed will ease the pace of tightening, market reaction to the NFP today could be in the spirit of “bad news is good news”: weak job growth will help to expect a cautious Fed, while a better-than-expected Payrolls print will further decrease the odds of the dovish “Fed pivot”.Employment data is also out in Canada today. Last month, the data was not very positive, showing a 43K job cut. This month, according to preliminary data, things should be much better, the consensus forecast expects a gain of 15,000 and unemployment at 5%. If the data confirms expectations, the CAD is likely to react positively, as the Bank of Canada is expected to raise rates by 50 bps in September and the market needs more arguments to count on such an outcome.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/july-nfp-preview-bad-news-is-good-news-reaction-is-highly-likely"
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S&P Midcap 400 Futures (EMD1!), H4 Potential For Bullish Rise

Type: Bullish RiseKey Levels:Resistance: 2564.0Pivot: 2494.8Support: 2460.9Preferred Case:On the H4, with prices moving above the ichimoku indicator, we have a bullish bias that price will rise to the pivot at 2494.8 where the pullback resistance is. Once there is upside confirmation of price breaking pivot structure, we would expect bullish momentum to carry price to 1st resistance at 2564.0 where the swing high resistance is.Alternative Scenario:Alternatively, price could drop to the 1st support at 2460.9 where the pullback support, 61.8% fibonacci projection and 23.6% fibonacci retracement are.Fundamentals:Due to fresh worries of global growth and House Speaker Nancy Pelosi's trip to Taiwan capital, Taipei, we have a bearish view on the Midcap 400 index. We'll need to exercise caution for this setup because our fundamentals and technicals are not completely aligned.

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/s-and-p-midcap-400-futures-emd1-h4-potential-for-bullish-rise"
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