Investment Bank Outlook 16-08-2022

Credit AgricoleChina: A Surprise Rate CutJuly activity data surprised to the downside by a wide margin, indicating weaker domestic demand amid Covid curbs and property market woes. The growth recovery in China remains challenging and requires continued policy easing to boost confidence and stabilise demand.The PBoC unexpectedly cut its policy interest rates by 10bp to show its support for growth. We think that, while policy easing will continue, it may be smaller and slower than required to drive a firm recovery in growth in H2, which will add investor concerns about global slowdown.We think China rates will continue toheadlowerinQ3ontheweak growth recovery and further PBoC easing. We see more limited downside in short vs long-end rates, however. CNH swap points will remain under pressure as the MLF cut adds to the monetary policy divergence between the US and China. We maintain a bias towards USD/CNY upside amidst weaker Chinese growth and the resilient USD.BNY MellonThe RBNZ is expected to hike its Official Cash Rate (OCR) by 50bp on Wednesday, but for the first time in its tightening cycle, risks to the policy path appear tilted to the downside. Throughout the year, sustained upside surprises in data and strong domestic demand has fuelled upward revisions to the RBNZ's terminal rate: the May Monetary Policy Statement (MPS) pushed the terminal rate to 3.9% and on a forward-looking basis, markets were even willing to price in 100bp above that. Fears of inflation spirals fully discounted any demand drag on headline prices measures and, in New Zealand’s case, the strong fiscal impulse generated during the pandemic was expected to generate significant overheating risk. The past few months have brought a reassessment on inflation pressures, however. While the general pullback has been led by the US, the lack of global demand has forced down commodity prices, including for soft commodities and agricultural products, which would have a stronger impact on New Zealand’s terms of trade. Even if the US outlook remains benign and it is only a matter of inflation peaking rather than falling, the marginal impulse for price pressures on the external front will tail off, meaning the RBNZ will likely shift to basing decisions fully on the domestic situation, which is becoming far more challenging.INGEURGBP & GBPUSDNews that Germany will impose a gas levy – confirming that the government cannot fully shield households from the spike in gas prices – leaves the UK less of an outlier in Europe. This will be one of the factors helping to limit EUR/GBP gains and could actually favour a drift back to the 0.8390/8400 area. Today's July UK employment data is somewhat of a mixed bag for sterling. This showed a slight slowing in hiring but strong average earnings – the latter pointing to hoarding of staff. We think the data supports a 50bp Bank of England hike on 15 September (45bp currently priced). In all, EUR/GBP can soften a little, but a stronger dollar means that Cable can go sub 1.20 again.

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Daily Market Outlook, August 16, 2022

Daily Market Outlook, August 16, 2022 Overnight Headlines US President Biden To Sign Health And Climate Bill On Tuesday UK Set To Begin Formal Dispute With EU Over Science Programs Iran Sends EU Nuclear Deal Response And Signals Pact Is Near RBA Signals Further Rate Hikes, Reiterates Not On Pre-Set Path China Needs More Stimulus To Boost Growth, PBOC Paper Says China Covid Cases Hold Near 3-Month High On Holiday Hotspots China Cuts US Treasuries Holdings For Seventh Straight Month PBoC Sets Weaker Fixing After Yuan Tumbles To Three-Month Low Asian Equity Markets Mixed; Chinese Property Stocks OutperformThe Day Ahead Asian equity markets are mixed this morning with no major moves. The oil price has fallen sharply with Brent crude hitting its lowest level since February on global growth concerns. Reports suggest that a heatwave in China is causing issues with hydroelectric power and threatening factory production. The minutes of the August Australian central bank meeting, when interest rates were raised by 50 basis points for the third consecutive time, indicated that further hikes are likely, but that policy is not on a pre-set course. Just released UK labour market data showed employment growth of 160k in the three months to June, while the unemployment rate held at 3.8%. However, there were hints that the tight labour market be starting to turn with job vacancies easing further away from their recent highs, albeit only marginally. Earnings data including bonuses slipped but the ex-bonus annual wage growth posted a higher-than-expected rise of 4.7% in June. The German ZEW survey will provide one of the first updates of August economic trends in the Eurozone. As a survey of analysts it can be less reliable than other indicators such as the PMIs but gets attention because of its timeliness. The latest readings are expected to show both current conditions and expectations at close to recent lows reflecting ongoing uncertainties not least the potential impact of higher gas prices. July data in the US are forecast to deliver mixed messages on economic activity. Housing starts are likely to have fallen for the fourth successive month reflecting the impact of higher interest rates, but industrial production may have risen. July UK inflation data will be released early Wednesday. It is expected to show a further rise in annual headline CPI inflation to 9.8% from 9.4% in June, a new 40-year high. Also look for the ‘core’ rate (excluding energy & prices) to increase to 6%, from 5.8% in June. UK inflation seems set to rise significantly further in October. The BoE calculates that it could move above 13% when the next Ofgem price cap comes into effect. Also, early Wednesday the Reserve Bank of New Zealand is expected to be the latest central bank to raise interest rates. The consensus expectation is for a fourth successive 50 basis points increase to take rates to 3%. The RBNZ also seems likely to warn that rates could still rise further.FX Options Expiring 10am New York Cut EUR/USD: 1.0100 (278M), 1.0125 (246M), 1.0145-55 (1.15BLN) 1.0160-65 (469M), 1.0170-75 (842M), 1.0185-90 (365M) 1.0250 (805M) USD/JPY: 132.90-00 (390M) AUD/USD: 0.7000 (490M), 0.7300 (640M) USD/CHF: 0.9640 (500M) USD/CAD: 1.2650 (282M), 1.2800 (308M), 1.2900 (290M)Technical & Trade ViewsEURUSD Bias: Bearish below 1.0410 Softer after closing down 0.95%, as the safe haven U.S. dollar jumped Cautious start, after Mondays soft China data inspired safe haven USD flows 20 day VWAP contracts - signals have turned modestly negative Close below 1.0215 a base in August, adds to the bearish outlook Targets a test of 1.0117, lower 20 VWAP and 1.0111 61.8% Jul/Aug rise Support around 1.0100 should be resilient unless there is significant news 1.0120/40 1.750 BLN, 1.0150 1.458 BLN are Tuesday's close major strikes 20 Day VWAP bearish, 5 Day bearishGBPUSD Bias: Bearish below 1.23 UK labour market shows more sign of cooling Employment +160k in three months to June vs 256k f/c; jobless rate 3.8% UK wage rises a potential headache for the Bank of England 20 day VWAP bands contract - signals show no significant bias Close below 1.2105 was bearish development Targets 1.2004 August low then 1.1963, 61.8% July-August rise 20 Day VWAP is bearish, 5 Day bearishUSDJPY Bias: Bearish below 136 USD/JPY moves tied to US yields, downside limited for now USD/JPY moves again tied to moves in US yields, downside limited for now US yields key, tad heavy but holding, Treasury 10s @2.778% JPY short positions pared considerably, buy-backs Option expiries not a big factor today, only $390 mln at 132.90-133.00 Massive expiries Thursday however, 132.00 $1.4 mln, 133.90 $652 mln USD/JPY trades within the usually resilient 132.06-135.17 20 Day VWAP is bearish, 5 Day bullishAUDUSD Bias: Bullish above .7050 Focus shifts to Australia Q2 wages data Wed, July employment data Thursday Minutes of RBA Aug policy meeting shows c.bank walking tight rope on policy Needs to prevent high inflation without curbing economic growth Australia inflation shot to 6.8% in June by new monthly measure Upside limited as weak data from China, US raise global recession fears Offers eyed .7270/30, bids .6950’s 20 Day VWAP is bullish, 5 Day bearishBTCUSD Bias: Bearish below 25.3K BTC washed up after failing to cross 25k again Closing above 24,665 needed to fuel rally Will exit VWAP uptrend channel if below 24,145 Last 24,004, BTC slipped 0.9% Mon despite Nasdaq rise Crypto assets under the weather despite risk-on in tech 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/neutral, 5 Day bearish

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Quarterly Earnings: Walmart and Home Depot

US stocks continued to extend their optimism, with participants believing the Federal Reserve could slow the pace of interest rate hikes amid weak inflation data. According to FedWatch, the probability of a 50 basis point rate hike is now 55%, while the probability of a 75 basis point rate hike is 45% (up from 32% and 68% respectively, a week ago). Technically, the S&P 500 closed its fourth straight week of gains (the longest winning streak since October 2021) at 4280. The index has recovered more than 50% of its losses since the start of the year, it added 17 more points on Monday to close at 4297.

Today (August 16), two major US retailers, Walmart and Home Depot, will report earnings before the market opens. Both reports will be for the fiscal quarter ending July 2022. Walmart operates supermarket chains, discount department stores, and grocery stores, while Home Depot sells tools, building products, appliances, and services. The latter is also the largest home improvement retailer in the United States. In terms of market capitalization in the retail space, Walmart is second with $362.43 billion (behind Amazon), while Home Depot came in third with $323.62 billion.

Fig 1:  US retail sales and Michigan consumer confidence index. source: Trading Economics

The latest data shows that US retail sales remain strong. They jumped 1% in June, recovering from a downwardly revised decline of -0.1% in May. On the other hand, the Michigan consumer confidence index improved to 55.1, the highest level in three months, beating market expectations of 52.5. Both figures may reflect a positive outlook for companies in the retail sector in the near term.

Fig 2：Walmart reported sales and EPS vs analyst forecasts Source: money.cnn

Walmart’s net sales have been growing steadily. According to Statista, the company’s net sales will reach $555.23 billion in 2021, up more than 32% from a decade ago. For the upcoming announcement, the consensus estimate for company sales is $151 billion, up 6.64% quarter on quarter and up 7.09% year over year. Conversely, Walmart’s earnings per share (EPS) fell short of analysts’ expectations due to an unusually high inflation environment that weighed on the margin mix and operating costs. The consensus estimate for EPS for the next quarter is $1.62, up 24.61% from the previous quarter but down nearly -9% from the year-ago quarter.

Unlike most analysts maintaining a “buy” rating, management’s outlook is relatively mixed. The team expects full-year net sales growth of 4.5%-5.0% (previously 4%) but flat earnings per share (previously expected mid-to-low single-digit growth).

Fig 3：
Home Depot reports sales and EPS versus analyst forecasts Source money.cnn

On the other hand, Home Depot had an exceptional 2021 global net sales of more than $151 million (up 14.4% compared to fiscal 2020). Ten years ago it was only $70.4 million. Market consensus for the company’s sales in its upcoming earnings announcement is $43.4 billion, up 11.57% sequentially and 5.60% year over year, respectively. Earnings per share are expected to reach $4.95, up 21% from the prior quarter and up 9.27% ​​from the year-ago quarter.

The optimistic outlook is not without reasons – strong demand for home improvement projects, the company’s interconnected retail strategy and technology infrastructure, effective program execution to expand supply chains, technology investments, and digital enhancements. As long as supply chain dynamics remain healthy and the consumer spending environment remains positive, there shouldn’t be much of a problem for the company’s growth and development, but we should take into account the relevant economic data in the coming months, and bear in mind that it’s too early to draw conclusions.

Technical Analysis:

 

#Walmart shares are still trading between low and median analyst estimates ($117, $140). Within this range, minor resistance lies at $133.81, which is the FR38.2% level extending from the April 2022 high ($160.74) to the May 2022 low ($117.17). If the bull market breakout is successful, the 100-day SMA will be the dynamic resistance to watch, followed by analysts’ median estimate ($140), which is also the FR50.0% level. Otherwise, $127.45 will be a minor support to watch. A break below this level could suggest that the bears are likely to extend to analysts’ low expectations ($117).

#HomeDepot shares have risen steadily since rebounding from a June 2022 low of $264.10. To date, the company’s share price remains supported above the 100-day SMA, a psychological level (or FR23.6% extending from the December 2021 high ($420.29) to the June 2022 low ($264.10)). If the bullish momentum persists, the nearest resistance to watch is $323.80, followed by $342.20 and $360.60. In terms of indicators, the MACD is still hovering above 0, while the RSI and Stochastics show that buyers are still in control (not overbought yet).

Click here to access our Economic Calendar

Larince Zhang

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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Market Update – August 16 – USD looks like “the cleanest shirt in the basket”

USDIndex rallied to start the week to 106.50 amid fears of dramatic slowdown China , along with an increasing likelihood of a recession in Europe. The PBoC’s 10 bp rate cut added to fears of meaningful slowing in activity there, dashing hopes of a pick up as covid restrictions were eased. US Yields drop, while US Stocks posted a modest rally.  Nikkei index closed almost flat, with energy-related stocks and shippers weighing the most. ASX rose 0.6% as upbeat earnings and record dividend from global miner BHP Group buoyed the mining sub-index. UK ILO unemployment remained steady at 3.8% in the three months to June – as expected. Commodities and Oil prices have been pressured by pick-up in risk aversion and concern that China’s recovery may be faltering. 

• USDIndex climbed back over the 106.000 level after weaker than expected data out of China weighed on investor sentiment globally, and left the USD looking like the cleanest shirt in the basket. And the buck held firm despite the steep drop in the Empire State index and a further slide in the NAHB housing index.
• Equities – USA500 rose 0.40% (4,303), coming off of its 4th straight weekly gain, the best stretch this year. The USA100 was 0.62% higher (13,700), and the USA30 was up 0.45% (33,924).
• Yields – the 2-year at 3.199% and the 10-year at 2.788%, with the curve holding around -42 bps.
• Oil – fell over -4% to a low of $86.75, Copper is off over -2% to $359.20, as the strenght of USD exacerbated the weakness in key commodities.
• Gold – fell -1.27% to $1772.72.
• Bitcoin steady bellow 24500.
• FX Markets – EURUSD down to 1.0160, USDJPY steady at 133.35 and Cable slumped to 1.2040. 

Today – ZEW Economic Sentiment from Germany and Europe. US Housing Starts and Building Permits  and Canadian Inflation. 

Biggest FX Mover @ (06:30 GMT) NZDUSD (+0.70%) retreats from 2 1/2 month peak (0.6467), currently to 0.6340. MAs aligning lower, RSI 32.66 & falling, Stochastic also down, but MACD lines flattened below 0. H1 ATR 0.00107, Daily ATR 0.00776.

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 prior written permission.

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ETHUSD, H4 | Potential Bullish Continuation

Type: Bullish BreakoutKey Levels:Resistance: 2012.25Pivot: 1916.67Support: 1786.26Preferred Case:On the H4, with price moving within an ascending channel and above the ichimoku indicator, we have a bullish bias that price will rise to the pivot at 1916.67 where the pullback support is. Once there is upside confirmation that price has broken pivot structure, we would expect bullish momentum to carry price to 1st resistance at 2012.25 where the swing high resistance is.Alternative Scenario:Alternatively, price could drop to 1st support at 1786.26 where the pullback support, 38.2% fibonacci retracement and 100% fibonacci projection are.

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BRITISH POUND Futures (6B1!), H4 Potential For Bullish

Type: Bearish DropKey Levels:Resistance: 1.2195Pivot: 1.2076Support: 1.1980Preferred Case:On the H4, as the DIF is crossing below the signal line and MACD histograms are below zero, we have a bearish bias that price may drop from the pivot at 1.2076 where the overlap support, 38.2% fibonacci retracement and 78.6% fibonacci projection are to the 1st support at 1.1980 in line with swing low and 61.8% fibonacci retracement.Alternative Scenario:Alternatively, price could rise to 1st resistance at 1.2195 where the overlap resistance is.Fundamentals:No major news

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Natural Gas Futures (NG1!), H4 Potential For Bullish Momentum

Type: Bearish DropKey Levels: Resistance: 9.276Pivot: 8.456Support: 7.557Preferred Case:On the H4, as the DIF is crossing the signal line and MACD histograms are shrinking above zero, we have a bearish bias that price may drop from the pivot at 8.456 where the 61.8% fibonacci retracement is to the 1st support at 7.557, which is in line with overlap support and 50% fibonacci retracement .Alternative Scenario:Alternatively, price could rise to 1st resistance at 9.276 where the swing high is.Fundamentals:Western sanctions against major exporter Russia squeezed an already under-supplied global market causing a surge in crude and natural gas prices. Therefore, from fundamental view, the price of gas is rising, we should take note of this confliction with technical view.

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Live Cattle Futures (LE1!), H4 Potential For Bullish Rise

Type: Bullish RiseKey Levels:Resistance: 144.475Pivot: 141.150Support: 138.225Preferred Case:On the H4, with price moving above the ichimoku indicator and along the ascending trendline , we have a bullish bias that price will rise to the pivot at 141.150 where the pullback resistance and 78.6% fibonacci retracement are. Once there is upside confirmation that price has broken the pivot structure, we would expect bullish momentum to carry price to 1st resistance at 144.475 in line with swing high resistance.Alternative Scenario:Alternatively, price could drop to 1st support at 138.225 where the pullback support and 23.6% fibonacci retracement are.Fundamentals:No Major News

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Don’t listen to the doom-mongers – the future is bright

With volatile markets, raging inflation and industrial unrest, it may feel like things are bad and likely to get worse. But the end of the world is not nigh, says Max King – things are looking up. Here’s why.

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BTCUSD, H4 | Potential Bullish Continuation

Type: Bullish BounceKey Levels:Resistance: 27156.43Pivot: 24676.23Support: 22483.65Preferred Case:On the H4, with price moving within a bullish channel as well as above the ichimoku indicator and RSI moving along an ascending trendline, we have a bullish bias that price will rise from our pivot at 24676.23 where the pullback support and 50% fibonacci retracement are to 1st resistance at 27156.43 where the 61.8% fibonacci retracement , -61.8% fibonacci expansion , 161.8% fibonacci extension and 100% fibonacci projection are.Alternative Scenario:Alternatively, price could break entry structure and drop to 1st support at 22483.65 where the pullback support and 61.8% fibonacci projection are.

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Precious Metals Monday 15-08-2022

Metals Weighed On By Stronger US DollarWith the US Dollar rallying across the European open on Monday, the metals market is seeing softer trading. Both gold and silver have started the week under offer as a higher USD and resilient equities prices divert trader attention elsewhere.USD has been bolstered by the better consumer sentiment data seen on Friday which is helping dilute recession fears somewhat. Additionally, the fall-back in inflation over July has also been taken as an encouraging sign. At 8.5%, CPI was still well above target in July. However, this reading marked a significant slow down from the prior month’s forty-year highs of 9.1%. The data has been welcomed by USD bulls as being a more positive input for growth projections over the remainder of the year. While markets have begun to price in a slower pace of hiking from the Fed, and this will certainly get more focus going forward, for now, the impact is supporting USD, weighing on metals.Broader developments in the risk backdrop are worth noting as we start the week. News of a further 0.10% rate cut from the PBoC has been a double-edged sword for markets. While news of fresh China stimulus has no doubt been welcomed, along with a slew of weaker-than-expected China indicators overnight, the move raises fears over the health of the Chinese economy. The fresh lockdowns this year have taken a heavy toll on the Chinese economy and with risks of further measures, as the country pursues its zero COVID strategy, there might be more downside to come. If this is the case and we start to see equities prices falling, gold might well start to see better safe-haven demand.Technical ViewsGoldThe rally in gold prices off the 1679.77 level has seen the market trading up through the bear channel from YTD highs. The correction is currently stalled around the 1791.63 level. However, with both MACD and RSI higher, the focus is on a further push higher towards the 1871.04 level while price holds above 1791.63. To the downside, any slip lower here will put focus on the 1722.37 level support.SilverThe rally in silver prices has seen the market reversing higher off the 18.4421 lows, trading back up through the bear channel top and up to test the 20.6398 level resistance. With both MACD and RSI bullish, the focus is on a further push higher towards the 22.3205 level next. To the downside, 19.5543 is the next support to watch.

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Investment Bank Outlook 15-08-2022

BNY MellonInflation Peaks, But Fed Stays HawkishLast week delivered encouraging news on the US inflation front. Data across a range of inflation and related indicators suggest pressure is easing somewhat, even if the actual level of inflation remains near multi-decade highs. Risk assets rallied impressively in response. Pricing in the forward rates market became more dovish. The odds inferred from federal-funds futures for a 75bp hike at the Sept. 20-21 FOMC meeting are now just around 50%, down from around 75% at the end of the prior week.The July CPI data was encouraging. Overall headline inflation didn’t rise over the month (consensus had expected an increase of 0.2%), and rose 8.5% on the year, compared to an annual increase in June of 9.1%. Much of this moderation occurred thanks to lower energy prices, which fell 4.6% in July. Indeed, core inflation (which excludes food and energy prices) was up 0.3% on the month and stayed at 5.9% on an annual basis.The Producer Price Index also released last week actually fell by -0.5% on the month, adding evidence to support that idea that inflation may have peaked. Furthermore, the NY Fed Survey of Consumer Expectations indicated that both short- and longer-term inflation expectations declined in July, and the University of Michigan Survey also showed a decline in 1-year inflation expectations, although 5-10y expectations were higher on the month.We may have reached peak inflation, but we don’t anticipate that it will fall very quickly. We’ve often pointed out that inflation was broadening across a range of stickier, less pandemic-affected categories, primarily in the core services bucket. These items tend to exhibit more inertia, meaning price increases are more likely to persist. The good news, as seen in the chart below, is that the annualized three-month percentage change was quite a bit lower in July, at 6.9% compared to 8.5% for the same measure in June. Still, these are high rates of inflation, and the deceleration in core services, which makes up 56% of the CPI basket (and 73% of the overall core index) may stall or occur very slowly.INGThe highlight as we start the week in Europe is the People's Bank of China's (PBoC's) decision to surprise with a 10bp cut to its MLF rate. This was last cut at the turn of the year and the move follows a weak batch of July Chinese data in the form of aggregate financing, industrial production and retail sales. Occasionally, one might see the commodity currencies rally on news of fresh monetary stimulus. In this instance, however, the Australian dollar is off around 0.5%. This can be rationalised through the view that the Chinese economy is still struggling and looks unlikely to contribute to any upside surprises to global growth this year.At the same time, investors are wary of new Covid outbreaks amid China's zero-Covid strategy and the potential for the type of renewed lockdowns that triggered China's GDP contraction in 2Q22. The renminbi has softened on the news and with the PBoC clearly acknowledging the need for more stimulus, investors may start to speculate that the 6.80 ceiling in USD/CNY may not be as strong as it seems. Keep track of USD/CNH here, where any moves through 6.80 could provide some support to the dollar across the board - just as it did back in April this year.

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Daily Market Outlook, August 15, 2022

Daily Market Outlook, August 15, 2022 Overnight Headlines Bitcoin Falls As 140K BTC Have Been Released To MTGox Customers Oil Prices Ease As Saudi Aramco Ready To Boost Crude Output Asia Equity Markets Mixed As China Cuts Rates, Data Disappoints Dems Send Landmark Climate, Tax And Health Care Bill To Biden US Lawmakers Arrive In Taiwan With China Tensions Simmering Granholm Sees US Gasoline Prices Dropping Further, With Caveat Rhine River At Key Waypoint Set To Steady At Low Water Level Liz Truss 22 Points Ahead In Race To Be Britain's Next PM: Poll China Central Bank Unexpectedly Cuts Key Rate To Spur Growth China’s July Retail Sales, Industrial Output Fall Short Of Estimates Japan’s Economy Accelerates Following Relaxation Of Covid Curbs Oil Prices Ease As Saudi Aramco Ready To Boost Crude OutputThe Day Ahead China’s central bank unexpectedly lowered its key interest rates as it sought to provide more support to its economy. The cut came just ahead of data, which showed weaker-than-expected increases in retail sales and industrial activity in July, while house prices reportedly fell 0.1% m/m. Elsewhere, the preliminary estimate of Q2 GDP for Japan posted a smaller-than-expected rise of 0.5% q/q (consensus: 0.7%), albeit that still meant that the economy recovered to its pre-pandemic size in the second quarter. With other major central banks set to continue tightening monetary policy for some time yet, measures of economic activity will be watched for signs that global demand is slowing across the major economies. The coming week sees a host of US economic activity data that will provide further insights into current economic conditions and whether GDP is likely to rebound in the second half of 2022 after falling in the first two quarters. This afternoon, the Empire State manufacturing survey for August is expected to show that factory output growth continues to moderate and we forecast the headline balance slipping from +11 in July to +7. Some attention will also likely be on the survey’s six-month ahead outlook index, which fell below 0 in July for only the fourth time since this measure began in 2001 (note that it stayed positive throughout 2020 and 2021). Expect the US NAHB survey to show housebuilders’ confidence to remain at its recent low of 55 in August, unchanged from its July reading. Elsewhere, there are no major releases due for the UK or Eurozone. Beyond today, however, it is a busy week for UK data releases with the latest labour market and inflation prints due early on Tuesday and Wednesday respectively. Tomorrow morning, expect the former to show further employment gains, look for 275k increase in overall employment in the three months to June. This will have kept the unemployment rate at 3.8%, only slightly above its recent low and equal to the pre-pandemic low. That seems clear evidence that the labour market remains very tight as does the very high level of unfilled job vacancies. There may, however, be tentative indications in the latter that the job market is starting to slow. More timely weekly data suggests that job vacancies are now moderating and that could be reflected in a small drop in the overall number of vacancies on the monthly measure, although it should still show them close to their recent highs. The headline measure of annual earnings growth is expected to have dipped to 4.5% from 6.2% previously, mainly due to the end of the bonus period. Regular earnings (ex-bonus) are forecast to pick up to 4.5% from 4.3%.FX Options Expiring 10am New York Cut EUR/USD: 1.0200-10 (350M), 1.0400-05 (494M) USD/JPY: 131.50 (300M), 133.00 (365M), 133.75-85 (365M) 134.00 (685M): EUR/JPY: 136.00 (340M) GBP/USD: 1.2285 (766M): EUR/GBP: 0.8535 (742M) USD/CAD: 1.2730-40 (662M), 1.2950 (655M)Technical & Trade ViewsEURUSD Bias: Bearish below 1.0410 EUR/USD opened 1.0255 after falling 0.61% on Friday After trading up to 1.0269 it drifted lower for much of the morning Weak China activity data took some of the shine off risk assets EUR/USD traded down to 1.0240 before settling around 10250 Resistance 1.0325, support 1.0190 20 Day VWAP bullish, 5 Day bearishGBPUSD Bias: Bearish below 1.23 Pivotal support in view after range resistance capped -0.05%, closed -0.65%, despite better than forecast UK GDP UK Treasury proposes plan to cut fuel costs extra £400, Times Cost of living crisis will be the key issue for the next prime minister Drought could be the next hurdle for the UK economy Offers sited at 1.2280/1.23 bids 1.2060 20 Day VWAP is bullish, 5 Day bearishUSDJPY Bias: Bearish below 136 Heavy early, as GDP misses expectations -0.3% as Japan Q2 GDP grew 2.2% against 2.5% forecast Japan economy recovering from COVID led downturn, but outlook uncertain USD/JPY trades within the usually resilient 132.06-135.17 20 Day VWAP is bearish, 5 Day bearishAUDUSD Bias: Bullish above .7050 Dips below 0.7100 as weak China data weighs AUD/USD dipped in a delayed reaction to weak China data AUD has outperformed other currencies recently due to bounce in commodities The data today suggests demand may weaken and weigh on sentiment Iron ore is down around 1.85% today while Lon copper is -0.90% Offers eyed .7270/30, bids .7040’s 20 Day VWAP is bullish, 5 Day bullishBTCUSD Bias: Bearish below 25.3K Unable to capture pivotal 25k level Sells off on news of 140k BTC to released to MtGox clients Profit taking on release in liquidation weighs on BTC 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

from Tickmill Expert Blog - Forex Traders Blog https://www.tickmill.com/blog/daily-market-outlook-august-15-2022"
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Michael Saylor: Tech mystic bets it all on bitcoin

Michael Saylor, the founder of a data analytics company, has pursued the odd strategy of placing thewhole firm on red at the roulette table that is bitcoin. Where will the ball finally land? Jane Lewis reports.

from Moneyweek RSS Feed https://moneyweek.com/investments/alternative-finance/bitcoin-crypto/605224/tech-mystic-bets-it-all-on-bitcoin
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