Ichimoku Kinko Hyo CNH/JPY: The CNH/JPY pair is trading above the Kumo…
Dollar steady in quiet start
Information is not investment advice
XAU/USD: Gold facing a further consolidation on 61.8% retracement area. The battle between bulls and bears keep going.
Ichimoku Kinko Hyo
EUR/JPY: The pair is trading below the cloud. A downward pressure would lead the pair to exit further the cloud, confirming a bearish outlook.
US Market View
U.S. stocks are seen opening largely unchanged Monday, remaining near record levels as investors digest a potential new infrastructure deal. Global shares began the week with a cautious start on Monday as Asian and European markets fell after a spike in coronavirus cases across Asia over the weekend hurt investor sentiment while oil hovered around 2-1/2 year highs.
MSCI's All Country World Index, which tracks shares across 49 countries, was down 0.1% by midday trade in London. U.S. stock futures traded positive, indicating gains at the open on Wall Street later in the day.
French President Emmanuel Macron received a bloody nose in Sunday’s regional elections, with his centrist party estimated to have won only around 10% of the votes. However, yields on French bonds fell due to the failure of Marine Le Pen’s far-right National Rally to take advantage. She ran against Macron in the presidential election of 2017, when advocating taking France out of the European Union.
The European Central Bank could end its emergency stimulus scheme next March and markets may be right in not pricing in an increase in more traditional bond purchases, Austrian central bank chief Robert Holzmann said on Monday. With the pandemic now receding, analysts, including the ECB's own Survey of Monetary Analysts, expect the 1.85 trillion euro Pandemic Emergency Purchase Scheme to end next March and see no increase in volumes under the Asset Purchase Programme (APP) to compensate for the lost stimulus.
The race is on to save the European holiday season, as the highly contagious delta strain of the Covid-19 virus threatens to result in more travel restrictions just as the summer starts. The number of delta variant Covid cases in the U.K. climbed to over 35,000 last week, a 46% increase from the previous week, the reason why the U.K. government chose to delay the country’s complete reopening for a month. An EU summit failed at the end of last week to agree a common line on quarantine requirements for travelers from the U.K., with countries who are dependent on tourism income resisting pressure from Germany's Angela Merkel for an EU-wide quarantine requirement on British arrivals.
USA Key Point
- ECB's Holzmann: PEPP will end when virus emergency is over.
- SNB's Maechler: Negative rates and FX interventions needed to to relieve pressure on franc.
- ECB's Holzmann: We don't know yet what price path will bring.
This week, there are a few high-probability trade ideas I'd like to recommend to you. Trading these setups, be sure to implement a proper risk management approach.
On Thursday, the 2nd of February, the Bank of England will publish its report concerning interest rates and inflation data for the Eurozone. Professionals and investors anticipate that Andrew Bailey’s lead team of policy makers will likely raise interest rates to 4%; the highest in over a decade, for the tenth time in a row.
The first FOMC meeting comes after a buildup of anticipation from traders and investors alike, as the markets await what posture the Fed will take regarding the interest rates; would there be a hike or a cut in interest rates? Recall that the Federal Open Market Committee had previously ended the year 2022 with a 50bps hike, and an indication from Powell, the committee chairman, that the Fed could consider raising interest rates by 75bps in the course of the year 2023.