Equity markets climbed in Europe yesterday
Ichimoku Kinko Hyo CNH/JPY: The CNH/JPY pair is trading above the Kumo…
EUR/USD: sets four-week high. Where stands the next target?
Information is not investment advice
Ichimoku Kinko Hyo
GBP/JPY: The pair is trading below the cloud. A downward pressure would lead the pair to exit further the cloud, confirming a bearish outlook.
Fibonacci Levels
XAG/USD: Silver stands above 61.8% retracement area. Bullish return with the hope to see price above $30 area.
EU Market View
Asian stocks rebounded from two-week lows struck on Tuesday as rising commodity prices boosted market expectations of an improved growth outlook, a day after rising U.S. Treasury yields and inflation prospects hit U.S. tech shares. Bond yields have risen sharply this month as prospects of more U.S. fiscal stimulus boosted hopes for a faster economic recovery globally. U.S. interest rates are now in positive territory, which has created some concern around the consequences for equities markets. Oil prices jumped by more than $1 on Tuesday, underpinned by optimism over COVID-19 vaccine rollouts and lower output as U.S. supplies were slow to return after a deep freeze in Texas shut in crude production last week.
Markets will turn their focus to Federal Reserve Chair Jerome Powell who is delivering his semi-annual testimony on Tuesday. Powell is likely to reiterate a commitment to keeping policy super easy for as long as needed to drive inflation higher.
Looking ahead, highlights from macroeconomic calendar include UK labour market report, EZ CPI (final), US consumer confidence, Fed Chair Powell's semi-annual testimony to the Senate, BoC's Macklem.
EU Key Point
- US futures keep higher ahead of European trading.
- Germany reports 3,883 new coronavirus cases, 415 deaths in latest update today.
- Oil prices (WTI and Brent) still rising during Asia trade.
- CAD traders heads up for Bank of Canada Governor Macklem speaking Tuesday.
- Federal Reserve Chair Jay Powell testimony on Tuesday.
- China state media says the recovery in economic growth paves the way for monetary policy normalization.
- Japan is considering lifting its state of emergency for areas outside Tokyo.
- US COVID-19 deaths climb above half a million.
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Brutal session in the equity markets yesterday
Ichimoku Kinko Hyo EUR/JPY: The EUR/JPY pair is now trading within the Kumo…
The U.S. economy added 390,000 jobs in May
Ichimoku Kinko Hyo USD/JPY: The USD/JPY pair is now trading above the Kumo…
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European Currencies Ahead of the Banks' Statements
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.
Will the FOMC Surprise the Markets?
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.
What awaits the Oil Market in February?
Western countries are trying to find other options for oil and gas supplies after a 10th package of sanctions, which will put more pressure on Russian oil and decrease global oil supply. Italy, for example, is in talks with Libya.
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