Daily Market News by Axiory

[Axiory]

16/06/2023 - Hawkish Stances Drive Forex Markets
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Thursday was a whirlwind day in the market, characterized by significant swings across Forex pairs, commodities, and indices. The day was driven by pivotal data releases and central bank decisions, leading to heightened volatility and some unexpected movements.
In the Forex market, the primary event was the European Central Bank's decision to raise interest rates by 25 basis points to 4%. This decision, alongside hawkish comments from the bank, strengthened the Euro. Thursday also brought significant retail data from the US, which had a substantial impact on the market. Contrary to expectations of a 0.2% decline, retail sales for May surprisingly rose by 0.3% on a monthly basis. This stronger-than-expected retail sales data would typically strengthen the US Dollar. However, the USD weakened on Thursday, which can primarily be attributed to profit-taking and a release of built-up pressure from a very active week marked by CPI and rate decision.

The Yen notably weakened on Thursday, following verbal interventions from Japan's Chief Cabinet Secretary Mr. Matsuno. This resulted in an uptick in most Yen pairs, with the AUDJPY pair experiencing a particularly steep rise.

Turning to commodities, the weakening of the USD provided some relief, leading to reversals in the trends of gold, silver, and oil. Gold, for example, moved back inside its pennant formation, effectively creating a false bearish breakout and a subsequent buy signal.

Indices on Thursday continued their upward trajectory. The S&P 500 showcased impressive strength by breaking upward from its channel formation, a definitive sign of bullish dominance. The German DAX flirts with long-term highs, suggesting a possible breakout if the buying pressure continues.

Shifting to Friday, the focus turns to the Bank of Japan's decision to keep its interest rates unchanged, and the forthcoming Preliminary University of Michigan Consumer Sentiment data from the US. The reversal trends for commodities such as gold and oil are expected to continue with the ongoing weakening of the USD. Indices such as the S&P 500, Dow Jones, and NASDAQ are projected to maintain their bullish movements.

 

[Axiory]

19/06/2023 - Corrections Across the Board Amid US Bank Holiday​

Monday's market action is characterized by a quieter tone, largely due to a bank holiday in the US. In the Forex market, we're witnessing a correction phase across several currency pairs. EURUSD is slightly down after an impressive performance last week, while AUDUSD, which had a robust first half of June, is also pulling back as traders take profits. A similar correction is seen in USDCAD which suffered heavy losses this month, and now showing a small upswing.
Similarly, USDJPY is on the downside, going against its dominant bullish trend. The indices are also showing signs of a pullback. On Friday, both the S&P 500 and Dow Jones formed shooting star patterns, often seen as bearish reversal signals, and today both indices are declining. The Nasdaq started a correction on Friday as well and continues to trend lower today.

Meanwhile, the Japanese Yen, which was notably weak throughout June, is showing slight strength today, but it's nothing remarkable as the currency remains relatively weak overall.

On the commodities front, there's not much noteworthy movement to start the week, with most commodities experiencing minor declines. However, the picture could change once the European session kicks in.

Overall, we're expecting a quieter trading day with most instruments counteracting their dominant trends from the previous week. The US bank holiday will likely contribute to lower volatility in today's market.

 

[Axiory]

20/06/2023 - Reserve Bank of Australia's Dovish Statement Weighs on Australian Dollar​

As anticipated, Monday unfolded without any significant market shifts or volatility. The overall sentiment remained largely unchanged. Today's calendar also mirrored yesterday's calm, with the primary event being the release of minutes from the Reserve Bank of Australia's monetary policy meeting. Notably, officials expressed that the debate between a rate hike and maintaining current rates is finely balanced. This statement, perceived as somewhat dovish, led to a decrease in the Australian dollar's value.
This drop is evident when looking at the AUDUSD pair, which is experiencing significant losses following a strong performance in the first half of June. At present, the pair is nearing a key horizontal support level at 0.678. Despite this downturn, the long-term sentiment for the Australian dollar to American dollar remains bullish.

Turning to indices, the bearish correction continued, with the market opening on a low note today, potentially resulting in a third consecutive bearish candle. This is especially noticeable on the French CAC 40, which bounced off a critical horizontal resistance level at 7350. As long as we remain below this level, the mid-term sentiment leans towards bearish.

Apart from these developments, many instruments are experiencing a rather sideways movement. We are still awaiting more significant movements. As predicted, volatility was subdued yesterday, and no major shifts occurred.​

 

[Axiory]

26/06/2023 - Forex Market Quiet but Oil Sees Upswing as New Week Starts​

This Monday brings a substantial amount of economic data and influential speeches. From Germany, the release of the German IFO business climate data is highly anticipated, with an expectation set at 90.7. Central bankers from Europe will also take the stage, with speeches from S&B Chairman Jordan and ECB President Christine Lagarde.
On the currency front, the market has opened in a relatively calm state. The Japanese Yen and Canadian Dollar lead as the strongest currencies at the start of the European session. Meanwhile, the Australian Dollar and American Dollar lag, marking the weakest currencies so far.

In the indices sector, we've seen a strong drop. A continuation of the bearish correction appears probable as we begin Monday's trading. The French CAC stands out, as it's currently breaking the neckline of a large head and shoulders pattern, suggesting potential difficulties for buyers.

Looking at commodities, oil has opened with an upswing, continuing the move initiated last week. However, in the midterm, oil remains stagnant, particularly observable in Brent Oil, which is currently ensnared in a rectangle pattern. Last week began with a bounce off the upper line and ended with a bounce off the lower line. Currently, we find ourselves precisely in the middle of this rectangle.​

 

[Axiory]

30/06/2023 - Impact of Surprising GDP and Inflation Figures on Thursday's Market, and What to Expect on Friday​

On Thursday, we observed some interesting shifts in the market. The day was marked by positive surprises from Germany and the U.S, which significantly impacted their respective currencies and broader financial markets. Inflation in Germany rose slightly higher than expected at 0.3%, compared to the forecast of 0.2%.
In the U.S, the final GDP numbers turned out to be quite optimistic, coming in at 2% against the predicted 1.4%. This bullish data demonstrated the resilience of the U.S economy, even amid inflation concerns. Additionally, the unemployment claims in the U.S fell to 239,000, lower than the expected 264,000, signaling a strengthening labor market.

The EURUSD experienced a drop, reaching weekly lows. This indicates a strong performance from the US Dollar on the forex market, buoyed by positive economic data and hawkish remarks from the Fed. The USDJPY pair climbed above the 145 mark overnight, hitting its highest level in 7.5 months, reflecting a resurgence of the US Dollar against the Yen as well. Indices too had an impressive week. European indices showed notable recovery, rising significantly after bouncing off key supports on Monday.
In the commodities market, gold hit new monthly lows, extending its bearish streak. In contrast, Brent oil experienced a bullish bounce after testing the crucial 71.7% support level.

As for Friday, the morning was marked by the release of Tokyo inflation data, which came in lower than expected at 3.2% against the expected 3.4%. This could potentially influence the Bank of Japan's monetary policy decisions moving forward.

Later in the day, we're expecting Eurozone inflation data, which is anticipated to be 5.6%. Given the recent trend in inflation surprises, traders will be watching this closely. Also, GDP data from Canada is due, which is projected to come in at 0.2%. Any significant deviation from these expected figures could trigger volatility in the respective currencies and broader market.​

 

[Axiory]

03/07/2023 - Dollar Weakens, Indices Surge: A Notable Start to the Week​

This week began on a quieter note, but the ripple effects of last week's movements are still apparent. The US dollar witnessed a decline last week, on the USDJPY resulting in its exit from an upward channel formation and signaling a strong sell. Conversely, indices such as the S&P 500 ended the week with an impressive upswing, setting new long-term highs.
Dow Jones and NASDAQ are also inching close to establishing new long-term highs, requiring only to surpass mid-June's levels. Monday's European sessions are expected to start with an increase. For instance, DAX is recapturing territory above its long-term uptrend line, while French CAC has ascended beyond key horizontal and dynamic resistances, triggering a strong buy signal.

On the Forex market, Monday marked rises in NZD and AUD, while the Japanese Yen weakened, thus fueling a notable upswing in AUDJPY. The price is currently breaking free from the wedge pattern, yielding a buy signal.

Monday's economic calendar is quite busy. It kicks off with the inflation figure from Switzerland, projected at 0.2%, followed by the US's ISM Manufacturing PMI, forecasted at 47.2, a slight increase from the previous 46.9.

Commodities started this week on the front foot, backed by the weakening dollar. Gold is poised for a bullish correction, which could potentially end the two-week downtrend witnessed in this instrument.​