Ichimoku Kinko Hyo CNH/JPY: The CNH/JPY pair is trading above the Kumo…
Euro further strength is ahead
Information is not investment advice
XAU/USD: Gold facing a further consolidation above 23.6% retracement area. Bulls come back.
Ichimoku Kinko Hyo
NZD/JPY: The pair is trading above the cloud. An upward pressure would lead the pair to exit further the cloud, confirming a bullish outlook.
US Market View
U.S. stocks are seen opening higher Friday, continuing to rebound after a difficult start to the week ahead of the release of key retail sales data. This week’s volatility has largely been as a result of a surge in inflation, with consumer pricing rising at the fastest rate since 2008 and producer prices posting the biggest gain in over a decade.
However, Federal Reserve officials have been at pains to state that the central bank’s accommodative monetary policies will not be changing any time soon. At the same time, the economic outlook is improving and the earnings season has been stronger than expected, suggesting more equity gains are possible.
Market nerves over inflation will be tested again by the release of U.S. retail sales data for April at 8:30 AM ET (1230 GMT), which are expected to slow markedly after household stimulus checks fueled a nationwide binge in spending in March.
Overall sales are expected to have risen 1.0% in the month, while core retail sales are expected to have risen 0.7%. Anything markedly stronger than that may revive concerns that the economy is already running too hot for comfort, despite largely soothing words from the Federal Reserve this week.
Oil prices rebounded Friday along with other risk assets as traders digested the return to operations of the largest fuel pipeline in the United States, the ongoing Covid-19 crisis in India, the third largest oil consumer in the world, and a broadly positive assessment of the outlook for demand growth from the International energy earlier in the week.
USA Key Point
- UK PM Johnson and chief medical officer Whitty to hold a press conference later.
- ECB minutes: Rate expectations remain well anchored by ECB guidance.
- Treasury yields keep a little lower so far on the day.
- Equities continue to keep with the bounce from yesterday.
- Germany sets new daily vaccination record with 1.35 million doses administered yesterday.
- Fed tolerance is the key variable in the market right now.
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.