2024-04-24 13:00

Japanese Yen Update - Prices, Chart, and Analysis USD/JPY closes in on the 155.00 level The market suspects this might be too high, too fast for the Japanese authorities The Bank of Japan will give its policy decision on Friday Learn How to Trade USD/JPY with our expert guide: The Japanese Yen ticked lower against the United States Dollar on Wednesday, with USD/JPY getting mighty close to the sort of level that might force authorities in Tokyo to intervene. The Dollar is of course benefitting against most rival currencies from a broad re-pricing of interest rate expectations. The resilience of pricing and economic growth in the world’s biggest economy has seen the prospect of lower rates pushed back, with the likely scale of cuts this year also reined in. Despite historic monetary tightening this year, the Yen still offers comparatively paltry returns so it’s perhaps unsurprising to see it on the ropes. USD/JPY has risen from 140.00 to within a whisker of 155.00 this year with the Yen skirting 35-year lows. The acting chair of Japan’s ruling Liberal Democratic Party Satsuki Katayama reportedly said on Tuesday that intervention in the currency market to bolster the Yen could come at any time given that its weakness is felt to be excessive and out of line with economic fundamentals. This is only the latest in a string of similar comments out of Tokyo, and the market is clearly on watch for action should the Dollar surge far above 155. Next week will bring the ‘Golden Week’ holiday season in Japan. The accompanying lower market liquidity might tempt interventionists, offering more bang for their buck. The Bank of Japan will announce monetary policy on Friday. On balance, it may want more inflationary evidence before it tightens rates again, but the meeting will be in play for traders nonetheless given the premium placed on official thinking in Japan now. USD/JPY Technical Analysis USD/JPY Daily Chart Compiled Using TradingView The pair has been driven dramatically higher since the start of this year, with its steep uptrend having now left the 200-day moving average nearly eight full Yen below the current market. This may well be ammunition for those in Tokyo who think current market action is divorced from the fundamentals. For now, the 155.00 psychological resistance level is capping the market and, the longer it continues to do so the higher the chances of a meaningful reversal given the sheer speed of the uptrend. Indeed, there may not be too much meaningful support on the downside until the trading band seen between February 9 and April 10. The top of that comes in at 151.86, with the base at 149.16 Should Dollar bulls force a break above 155.00 they are likely to face quite strong resistance around 155.50 even if there is no official action from Tokyo to slow the greenback’s progress. --By David Cottle For DailyFX https://www.dailyfx.com/news/japanese-yen-lower-again-usdjpy-market-weighs-intervention-chances-20240424.html

2024-04-24 07:47

Gold, VIX, and Tesla Latest Outlooks and Analysis The VIX falls 27% from Friday’s high Tesla rallies 14% after hours despite missing expectations. Gold pops higher on a weaker US dollar. The feelgood factor remains across a range of risk markets with equity indices brushing off last week’s sell-off and pushing further ahead. The current lull in the Israel-Iran conflict is helping market sentiment while positive US earnings are adding to the move. Three important US data releases this week – durable goods (today), US Q1 GDP (Thursday), and US Core PCE (Friday) – may derail the current move. There are also some heavyweight US companies reporting earnings this week, including IBM, Meta, Alphabet, Intel, and Microsoft. The VIX highlights the recent change in mood with the closely followed ‘fear gauge’ falling by over a quarter from Friday’s high print. What is the VIX? A Guide to the S&P Volatility Index VIX Daily Price Chart Chart by TradingView Overnight price action in Tesla (TSLA) underlines the risk-on sentiment with the EV car giant up 14% after hours. Tesla dropped its latest results yesterday and missed both revenue and profit expectations. Markets however ignored traditional metrics and instead were buoyed by the company’s decision to bring forward the launch of its more affordable new models from the second half of 2025, although no dates or pricing details were announced. Keep informed of all earnings releases with the DailyFX Earnings Calendar Tesla Dollar Index Daily Chart Chart by IG Tuesday’s weaker-than-expected US PMIs sent the US dollar lower, propping up a range of USD pairs and gold and silver. Gold has had a relentless bid over the last few weeks as investors moved into haven assets as the conflict in the Middle East worsened. Gold broke below $2,300/oz. yesterday but quickly recovered after the release of the weak US PMIs. Below this level, $2,280/oz. comes into focus. All eyes are now on US data. US Dollar Rattled by Weak PMIs, US GDP and Core PCE Remain this Week’s Key Drivers Gold Daily Price Chart IG Retail Sentiment shows 52.79% of traders are net-long with the ratio of traders long to short at 1.12 to 1.The number of traders net-long is 3.25% higher than yesterday and 1.69% higher than last week, while the number of traders net-short is 8.16% higher than yesterday and 7.99% lower than last week. We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests Gold prices may continue to fall. See the Full Report Below: What are your views on the Risk – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1. https://www.dailyfx.com/news/risk-sentiment-remains-positive-gold-vix-tesla-latest-outlooks-20240424.html

2024-04-23 19:30

US Dollar Price, Charts, and Analysis US economic upturn ‘lost momentum’ at the start of Q2 – S&P Global. Official Q1 GDP is released on Thursday, and Core PCE on Friday. US dollar slips but the sell-off may be short-lived. US business activity continued to increase in April, but ‘the rate of expansion slowed amid signs of weaker demand’, according to the latest S&P Global Flash PMI report. All three readings hit multi-month lows, while the Manufacturing PMI fell back into contraction territory. Commenting on the data, Chris Williamson, Chief Business Economist at S&P Global Market Intelligence said: “The US economic upturn lost momentum at the start of the second quarter, with the flash PMI survey respondents reporting below-trend business activity growth in April. Further pace may be lost in the coming months, as April saw inflows of new business fall for the first time in six months and firms’ future output expectations slipped to a five-month low amid heightened concern about the outlook.” S&P Global Flash US PMIs – Full Report Shorter-dated US Treasury yields move lower post-PMIs but remain at elevated levels. The rate-sensitive 2-year has tried, and failed, to break above 5% in the past few weeks as US rate cut expectations are pared back. From the best part of 170 basis points of cuts forecast at the end of last year, the markets are now showing just 44 basis points, with the first quarter-point cut seen at the September 18th FOMC meeting. This week also brings a total of $183 billion of new, shorter-dated US Treasuries to the market. Today sees $69 billion 2-years on the block, while $70 billion 5-years and $44 billion 7-years will be auctioned off on Wednesday and Thursday respectively. Any poor auction will push outstanding UST yields higher. From a technical angle, the US 2-year yield chart may be making a bullish flag formation which if completed would suggest a re-test of the October 19th high at 5.26%. UST 2-Year Yield Daily Chart US dollar traders will now be on alert for three major US data releases, US durable goods (Wednesday), US Q1 Flash GDP (Thursday), and US Core PCE on Friday. All three are potential market movers but it’s the last two that carry the most heft. The US dollar index is down a fraction post-PMIs but remains elevated. A break above 106.58 would leave October’s high at 107.335 vulnerable and would completely retrace the July 2023 - December 2023 sell-off. All three simple moving averages remain in a bullish formation, while the 50-/200-day bullish crossover made in late March continues to steer the market higher. US Dollar Index Daily Chart All Charts via TradingView What are your views on the US Dollar – bullish or bearish?? You can let us know via the form at the end of this piece or you can contact the author via Twitter @nickcawley1. https://www.dailyfx.com/news/us-dollar-rattled-by-weak-pmis-us-gdp-and-core-pce-remain-this-week-s-key-drivers-20240423.html

2024-04-23 17:30

Microsoft earnings date Microsoft Corporation (Nasdaq: MSFT) is scheduled to reveal earnings on April 25, 2024, after the market closes. The earnings report will cover the fiscal calendar quarter ending March 2024, which aligns with FY24 Q3 for Microsoft. Microsoft earnings expectations and key watches Based on the Q3 guidelines published alongside the Q2 report, a slower revenue growth compared to previous quarters is expected. Q3 revenue is anticipated to be around $60.86 billion, down from $61.13 billion in Q2, while still representing approximately 19% year-over-year growth. Earnings per share are estimated to be $2.84, an increase from $2.77 last quarter, marking a 27% year-over-year improvement. Intelligent Cloud As demonstrated in Microsoft's recent reports, cloud services remain the crown jewel, driving “Intelligent Cloud” revenue to $25.88 billion in Q2, up 20% year-over-year, and contributing to more than 40% of the group's total revenue. This momentum is expected to continue in Q3 as Microsoft projects revenue from this segment to grow to $26-$26.3 billion. Source: Microsoft AI While Microsoft's cloud segment shines as its crown jewel, the most anticipated excitement will more likely come from its AI update. As the world’s most valuable company, Microsoft’s progress in its AI development will be under strict scrutiny. Since investing heavily in OpenAI to secure the enviable partnership, Microsoft has prioritised the integration of AI into its tech ecosystem. Today, with ChatGPT becoming a household name, bullish investors are eagerly anticipating Microsoft's progress in AI integration into and next strategic moves to capitalize on its leadership in the AI space. Challenges The notable laggard within Microsoft’s technology powerhouse comes from its devices and Office commercial products revenue, which recorded 9% and 17% decrease in the previous quarter. Given the subdued demand from the PC market, these two sectors are expected to see a low double-digit decline in Q3. Microsoft stock price The prevailing risk-averse sentiment since the beginning of Q2 has effectively frozen the ascending journey for Microsoft's stock prices, which surged by 38% from October 23 to March 2024; by the time of writing, the tech giant's share prices have fallen more than 6% from its all-time high of $427. Despite the recent pullback, TipRanks gives MSFT a 'outperform' smart score, meanwhile, 32 out of 34 analysts have recommended a buy in the past 3 months. Source: IG Looking at the daily chart, the price has experienced two vital breakouts to signal further downtrend could be in the cards, including: breaching the months-long ascending trendline and breaking below the 100-day moving average for the first time in 2024. Furthermore, the RSI has also fallen to its lowest level since November, underscoring the bearish momentum at the moment. Technically, any further downtrend will find imminent support at the $379-$382 zone, where the 23.6% Fibonacci retracement and the previous high converge. A break below this support could open the door to challenge the critical 200-day SMA, unbroken for over a year. On the other hand, the first upside target could be eyed at $415, where the 50-day SMA sits. Source: IG Risk warning: The figures stated are as of 23 April 2024. Past performance is not a reliable indicator of future performance. This report does not contain and is not to be taken as containing any financial product advice or financial product recommendation. https://www.dailyfx.com/news/microsoft-earnings-preview-can-the-ai-leader-reignite-excitement-in-the-tech-sector-20240423.html

2024-04-23 15:16

Euro (EUR/USD, EUR/GBP) Analysis Flash PMI data provides unflattering US outlook, Europe improves EUR/USD rises after US PMI shock EUR/GBP surrenders recent gains Elevate your trading skills and gain a competitive edge. Get your hands on the Euro Q2 outlook today for exclusive insights into key market catalysts that should be on every trader's radar: Flash PMI Data Provides Unflattering US Outlook, Europe Improves German and EU manufacturing remains depressed but encouraging rises in flash services PMI results suggest improvement in Europe. UK manufacturing slumped well into contraction but also benefitted from another rise on the services front. It was the US that provided the most surprising numbers, witnessing a decline in services PMI and a drop into contractionary territory for manufacturing – weighing on the dollar. EUR/USD Rises after US PMI Shock EUR/USD responded to lackluster flash PMI data in the US by clawing back recent losses. The euro attempts to surpass the 1.0700 level after recovering from oversold territory around the swing low of 1.0600. The pair has maintained the longer-term downtrend reflective of the diverging monetary policy stances adopted by the ECB and the Fed. A strong labour market, robust growth and resurgent inflation has forced the Fed to delay its plans to cut interest rates which has strengthened the dollar against G7 currencies. The surprising US PMI data suggests the economy may not be as strong as initially anticipated and some frailties may be creeping in. However, it will take a lot more than one flash data point to reverse the narrative. If bulls take control from here, 1.07645 becomes the next upside level of interest followed by 1.0800 where the 200 SMA resides. On the downside, 1.06437 and 1.0600 remain support levels of interest if the longer-term trend is to continue. EUR/USD Daily Chart Source: TradingView, prepared by Richard Snow EUR/GBP Surrenders Recent Gains EUR/GBP rose uncharacteristically on Friday when risks of a broader conflict between Israel and Iran subsided. In addition, the Bank of England’s Deputy Governor Dave Ramsden stated that he sees inflation falling sharply towards target in the coming months, sending a dovish signal to the market. Today the BoE’s Chief Economist Huw Pill tried to walk back such sentiment, stressing that the bank needs to maintain restrictiveness in its policy stance. He did however, echo Ramsden’s remarks by saying the committee is seeing signs of a downward shift in the persistent component of the inflation dynamic. EUR/GBP appears to have found resistance around 0.8625 and has traded lower after the PMI data, even heading lower than the 200 SMA. A return to former channel resistance is potentially on the cards at 0.8578. Prices settled into the trading range as central bankers mulled incoming data and the prospect of a first rate cut appeared a fair distance away. Longer-term, the ECB is on track to cut rates in June, meaning sterling will extend its interest rate superiority and is likely to see the pair test familiar levels of support. EUR/GBP Daily Chart Source: TradingView, prepared by Richard Snow https://www.dailyfx.com/news/eur-usd-rises-after-shock-us-pmi-highlights-demand-weakness-20240423.html

2024-04-23 13:30

British Pound (GBP/USD) News and Analysis GBP/USD remains in a well-respected downtrend BOE’s Haskel reminded markets that the UK labor market remains tight This was perhaps modestly more hawkish than some recent BoE comments Elevate your trading skills and gain a competitive edge. Get your hands on the Pound Sterling Q2 outlook today for exclusive insights into key market catalysts that should be on every trader's radar: The British Pound is higher against the United States Dollar in Europe on Tuesday, although the overall downtrend endures, rooted in diverging monetary policy expectations. Earlier in the session Bank of England policymaker Jonathan Haskel said that inflation will be impacted by labor-market tightness, and that that tightness has been falling rather slowly. This reminder that inflation can be hard to beat contrasted somewhat with the more ‘dovish’ commentary from other BOE officials in the recent past and might explain why sterling’s fall has slowed. However, the backdrop remains one in which UK interest-rate cut forecasts have been brought forward, even as the resilience of the US economy has seen them pushed back appreciably there. Recall that, when 2024 got under way, the smart money was on the Federal Reserve starting to reduce interest rates in March. Well March has come and gone with no sign whatever of lower borrowing costs. Sterling was once a clear outlier as British inflation remained stubbornly higher than peer economies’. However, things have changed and now the market is pretty sure the BOE will start to cut interest rates in August. This shift in views is not limited to Sterling, but it’s clear to see why this is not an environment for bulls. That’s why GBP/USD is back down to levels not seen since last November. The rest of this week offers very little important scheduled data from the UK. In any case there’s little more important data release in the entire global round these days then the US inflation print form the Personal Consumption and Expenditure series. That’s due on Friday and will likely dictate GBP/USD trade at least in the short term. Expect narrow daily ranges until the markets have seen this. GBP/USD Technical Analysis GBP/USD Daily Chart Compiled Using TradingView The parallel downtrend channel from March 7 has been remarkably well respected, at least on a daily closing basis, but is clearly now facing a stern challenge to its lower boundary. At face value a daily close below it looks like bad news for GBP bulls. They’re going to have to raise their game to stop it given that it currently offers support at 1.2399. Should that boundary give way, focus will be on retracement support at 1.20906, with November 13’s high of 1.22677 barring the way down to it. Bulls’ first order of business is to defend that downtrend line. If they can, they’ll need to consolidate gains above psychological resistance at 1.24000 if they are going to retake that retracement level. IG’s own sentiment data suggests the bulls are in charge at current levels, with over 65% of traders coming to the market expecting gains. However, even if seen, these are likely to be mere consolidation within the broader downtrend --By David Cottle for DailyFX https://www.dailyfx.com/news/british-pound-bounces-at-downtrend-line-still-pressured-by-rate-cut-expectations-20240423.html