2024-07-26 13:08

US Inflation Data Little Changed in June, USD and Gold Listless Post-release US Core PCE y/y unchanged at 2.6%, missing estimates of 2.5%. Interest rate probabilities are unmoved with a September cut fully priced in. The US Core PCE inflation gauge y/y was unchanged at 2.6% in June but missed market expectations of 2.5%. The PCE price index fell to 2.5% from 2.6% in May, while personal income m/m fell by more than expected to 0.2%. Today’s release gives traders little new to work with and leaves the US dollar apathetic going into the weekend. Financial markets continue to fully price in a 25 basis point interest rate cut at the September 18 FOMC meeting, with a second cut seen in November. A third-quarter point cut at the December 18 meeting remains a strong possibility. US dollar traders will now look ahead to next week’s FOMC meeting to see if chair Powell gives any further guidance about upcoming rate cuts. The US dollar index (DXY) is trading on either side of the 38.2% Fibonacci retracement level at 104.37, and the 200-day simple moving average, and will need a new driver to force a move ahead of next Wednesday’s Fed meeting. US Dollar Index Daily Chart The price of gold nudged around $5/oz. higher after the inflation report and remains stuck in a multi-month range. The precious metal briefly broke resistance two weeks ago but quickly slipped back into a range that started in early April. Gold Price Daily Chart Retail trader data shows 61.36% of traders are net-long with the ratio of traders long to short at 1.59 to 1.The number of traders net-long is 11.61% higher than yesterday and 16.13% higher than last week, while the number of traders net-short is 8.68% lower than yesterday and 20.13% 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. Traders are further net-long than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger Gold-bearish contrarian trading bias. 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 contact the author via Twitter @nickcawley1. https://www.dailyfx.com/news/us-inflation-data-little-changed-in-june-usd-and-gold-listless-post-release-20240726.html

2024-07-26 08:08

AUD/USD: Retail trader data reveals that 78.72% of traders are net-long, with a ratio of 3.70 long traders for every short trader. The number of net-long traders has increased by 5.45% since yesterday and 34.21% since last week. Conversely, net-short traders have decreased by 14.05% since yesterday and 49.63% since last week. Taking a contrarian view to crowd sentiment, the predominance of net-long traders suggests AUD/USD prices may continue to fall. The increase in net-long positions both daily and weekly strengthens this bearish outlook for AUD/USD. AUD/USD Sentiment Chart Source: IG, DailyFX, prepared by Richard Snow GBP/USD: Retail trader data shows that 37.63% of traders are net-long, with a ratio of 1.66 short traders for every long trader. Net-long traders have increased by 2.27% since yesterday and 9.89% since last week. Net-short traders have decreased by 8.01% since yesterday and 11.81% since last week. While a contrarian view to crowd sentiment suggests GBP/USD prices may continue to rise due to the majority being net-short, recent changes in sentiment indicate a potential downward reversal in the current GBP/USD price trend. GBP/USD Sentiment Chart Source: IG, DailyFX, prepared by Richard Snow USD/JPY: Retail trader data indicates that 41.56% of traders are net-long, with a ratio of 1.41 short traders for every long trader. Net-long traders have increased by 4.29% since yesterday and 8.00% since last week. Net-short traders have decreased by 7.01% since yesterday and 16.85% since last week. Although a contrarian view to crowd sentiment suggests USD/JPY prices may continue to rise due to the majority being net-short, recent changes in sentiment warn of a potential downward reversal in the current USD/JPY price trend. USD/JPY Sentiment Chart Source: IG, DailyFX, prepared by Richard Snow https://www.dailyfx.com/news/retail-trader-sentiment-update-gbp-usd-aud-usd-usd-jpy-latest-20240726.html

2024-07-25 16:00

When will Apple report its latest earnings? Apple is scheduled to report its third quarter (Q3) earnings on Thursday, August 1, 2024. Key Financial Metrics Last quarter (Q2), Apple reported a revenue beat of $90.75 billion vs. $90.01 expected and an EPS beat of $1.53 vs. $1.50 estimated. The company announced that the board had authorised $110 billion in share repurchases, a 22% increase over the previous year's $90 billion. Providing a further sweetener, the company authorised a 25-cent dividend, a combination that sent the share price soaring 7% in after-hours trading. The company reported the following key numbers: iPhone revenue fell nearly 10% to $45.96 billion vs $46.00 billion expected Mac revenue increased 4% to $7.5 billion vs $6.86 billion expected iPad revenue of $5.6 billion vs $5.91 billion expected. Apple has not released a new iPad since 2022. Services revenue increased 14.2% to $23.9 billion vs the $23.37 billion expected. The Services segment includes subscriptions like iCloud Storage, App Store and Apple Music. The Wearables or Other Products section, which includes Air Pods and Apple Watches, fell over 10% to $7.9 billion Net Sales by Category for Q2 highlighted Source Apple.com Market performance in greater China Apple's sales in Greater China, its third largest market, were off 8% to $16.37 billion. However, the number exceeded analysts' estimates of $15.25 billion, easing worries that the iPhone was losing market share to homegrown products like Huawei. Net Sales by Reportable Segment Chart Source Apple.com Stock Performance In its Q2 Earnings call, Apple did not provide formal guidance for Q3. However, CEO Tim Cook, on a post-earnings call, indicated that overall sales would grow in the "low single digits during the June quarter. Key Financials - Summary Wall Street's expectations for the upcoming results are as follows. EPS: $1.34 vs $1.53 per share previous quarter Revenue: $84.3 billion vs $90.75 billion Apple Sales Revenue Source Trading Economics Key Metrics and Insights to Watch out for iPhone performance: Apple faces challenges in China and has offered discounts to compete with rivals like Huawei. Sales are expected to fall again this quarter to $37.7bn from $45.96bn in Q2. Mac sales: The Mac business is expected to perform well, with shipments rising 20.8% year-over-year, outpacing the broader PC market. Services growth: Apple's digital services business is anticipated to continue its strong performance, driven by higher AppStore sales and increased uptake of subscription services. Gross margins: The company's gross margins are expected to rise due to a favourable sales mix of premium products and higher service sales. AI developments: Updates on Apple's new generative AI software, Apple Intelligence, are expected to drive a record device upgrade cycle, boosting iPhone and iPad sales and prices. China market: Given recent headwinds, Apple's performance in China, one of its largest markets, will be closely watched. Guidance for Q4: Apple has not provided official guidance since 2020. However any insights into projections for the upcoming quarter will be important, particularly around Apple Intelligence and the expected upgrade cycle from Apple Intelligence. Apple Technical Analysis Apple's share price enjoyed a 60% gain from its early January 2023 low of $124.17 to its high of $199.62 in December 2023 before spending the next five months consolidating gains in a range between $200 and $165.00. Apple's Q2 earnings update in early May, followed by its WWDC on June 10, was the catalyst for the break above $200 to its mid-July high of $237.23. Since that point, Apple's share price has corrected 8.50% lower. If the pullback deepens, we expect Apple's share price to be well supported by buyers between $210 and $200 looking for a push towards $250/$270 in due course. Aware that if Apple's share price were to see a sustained break below $200/$190, it would negate the bullish outlook and warn that a deeper pullback is underway, Apple Daily Chart Summary Apple is scheduled to report its third quarter (Q3) earnings on Thursday, August 1, 2024. We favour buying dips in Apple's share price towards support at $210/200, looking for a move towards $250/$270 in due course. Source Tradingview. The figures stated are as of July 25, 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/apple-q3-earnings-preview-a-closer-look-at-earnings-forecasts-and-china-20240725.html

2024-07-25 13:07

US Dollar Analysis and Chart US economy expands by 2.8% in Q2, initial data show. US dollar little changed, eyes Friday’s US Core PCE release. The US economy expanded by 2.8% in Q2 - beating market forecasts of 2% - according to recently released BEA data. Compared to the first quarter (1.4%), the acceleration inreal GDPin the second quarter primarily reflected an upturn in private inventory investment and an acceleration in consumer spending. A downturn in residential fixed investment partly offset these movements. According to the BEA, today’s advance reading is based on ‘source data that are incomplete or subject to further revision.’ The 2nd estimate will be released on August 29th. US Bureau of Economic Analysis (BEA) Report The Durable Goods Orders data, -6.6% compared to forecast of +0.3%, was driven lower by a large decrease in transportation equipment. Excluding transportation, new orders increased by 0.5%. Monthly Durable Goods Orders – US Census Bureau The better-than-expected GDP report trimmed US rate cut expectations by two to three basis points. Despite the report, markets continue to fully price in a 25 basis point rate cut at the September 18 meeting with further quarter point cuts expected at the November 7 and the December 18 meetings. The US dollar index picked up a small bid but remains calm ahead of Friday’s Core PCE data. The DXY is trading on either side of the 200-day sma and will likely stay that way until 13:30 UK tomorrow. US Dollar Index Daily Chart 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/the-us-economy-grew-by-2-8-in-q2-compared-to-1-4-in-q1-us-dollar-little-changed-20240725.html

2024-07-24 16:00

Profit slump and financial performance Tesla's second-quarter profits for 2024 plummeted by 45%, with net income falling to $1.47 billion, well below analysts' expectations of $1.9 billion. The electric vehicle giant faced headwinds from slower sales, increased costs due to employee layoffs, and significant investments in artificial intelligence infrastructure. Despite these challenges, revenues rose 2% to $25.5 billion, narrowly exceeding expectations. This growth was primarily driven by record performance in the energy storage business and an unusually large sum of regulatory credits related to emissions requirements. Operational costs and margins Operating expenses soared 39% during the quarter, reaching almost $3 billion. This increase was partly due to restructuring and legal costs associated with the company's decision to cut 10% of its workforce in April. Tesla's gross margin, a closely watched financial metric, fell to 18% in the quarter, down from a peak of 29.1% in the first quarter of 2022. Without the record $890 million in regulatory credit revenues, the automotive gross margin would have dropped to 14.6%. Strategic focus on autonomy and robotics Elon Musk, Tesla's CEO, has shifted the company's focus towards developing autonomous technologies and robotics. The unveiling of Tesla's "robotaxis" has been postponed from August to October, with Musk claiming that this project could potentially increase Tesla's valuation to $5 trillion. The company is also prioritising the development of Optimus, an autonomous humanoid robot. Musk stated that these robots are already performing tasks in Tesla factories, with limited production for consumer use expected to begin in 2026. Market position and delivery numbers Despite the challenges, Tesla delivered nearly 444,000 EVs in the second quarter. While this represents a 4.7% year-over-year decrease, it's an improvement from the first quarter's 387,000 deliveries. This performance was sufficient to maintain Tesla's position as the largest EV company ahead of China's BYD. Recent developments and stock performance Tesla has had an eventful year, with shareholders reapproving Musk's $56 billion pay award and backing a proposal to reincorporate the company in Texas. Musk has also emerged as a prominent supporter of former president Donald Trump in the upcoming US election. However, these developments haven't bolstered investor confidence. Tesla's stock has fallen 8% in the past 12 months, and its market capitalisation has almost halved from its peak of $1.2 trillion in November 2021. Company rankings & analyst consensus Tesla currently has a neutral rating of 5 on the Smart Score ranking, indicating caution among investors about the outlook. Source: IG Of 30 analysts currently covering the stock, 12 have ‘buy’ rankings, with 11 ‘holds’ and 7 ‘sells’. Tesla broker ratings chart Source: IG Tesla stock price – technical analysis The price dropped sharply in the wake of results last night, pushing the stock down 16% from the highs seen earlier in July. The price is now testing previous trendline resistance from the July 2023 highs, which it broke above around four weeks ago. Tesla has rallied over 60% from the April lows, so some further consolidation or losses would not be surprising. However, with the 50-day simple moving average (SMA) likely to cross over the 200-day SMA in the near future it appears we could be witnessing a trend change, where dips become buying opportunities. TSLA chart 240724 Source: IG/ProRealTime https://www.dailyfx.com/news/tesla-stock-price-slumps-after-q2-earnings-20240724.html

2024-07-24 14:04

USD/JPY, JGB News and Analysis The Yen makes up more ground against the dollar. USD/JPY accelerates lower USD/JPY continues the bearish trend after the pair took out major support levels BoJ to decide if weak consumption is likely to delay inflation goal The analysis in this article makes use of chart patterns and key support and resistance levels. For more information visit our comprehensive education library The Yen Makes up More Ground Against the Dollar The Japanese yen appreciated against a basket of major currencies on Wednesday, one week ahead of the much-anticipated Bank of Japan (BoJ) meeting. The BoJ mentioned in their June meeting that details around reducing their balance sheet will be made available at the end of this month after disappointing market hopefuls last month. Japan is in the slow process of policy normalisation whereby it is expected to hike rates to a neutral that is neither stimulatory nor restrictive – said to be anywhere between 0.5% and 1.5% - but is weighing up encouraging inflation data against less than stellar consumption data. It is hoped that reduced taxes and higher wages would stimulate a rise in local consumption and household sentiment to such a degree that the inflation target of 2% is likely to be breached consistently. Japanese Index (Equal-Weighting in USD/JPY, GBP/JPY, AUD/JPY, EUR/JPY) Source: TradingView, prepared by Richard Snow USD/JPY Technical Analysis The weekly USD/JPY chart reveals the anticipated Q3 trading range, highlighting both the upward drift at the start of the quarter, followed by the much-anticipated move lower as the yen claws back significant losses. The next level of significance is the 151.90 level of support which market the moment Tokyo decided to intervene in the FX market back in 2022. Get the full insight of surrounding the many factors influencing the yen in our comprehensive Q3 forecast: USD/JPY Weekly Chart Source: TradingView, prepared by Richard Snow The daily USD/JPY chart shows the recent progress made by the yen, aided by a weaker US dollar and suspected FX intervention from FX officials. Markets have been wrong-footed by Japanese officials as it appears mass yen purchases are being carried out after good news such as lower than expected US inflation. This is in contrast to previous mass yen purchases which were deployed in a reactionary fashion after bad news for the yen like hotter than expected US inflation or economic growth. The daily chart shows the oversold conditions that hinted at shorter-term bearish reversal which ultimately materialised. Since then, the pair has been riding the bearish wave lower, tagging the 160.00 and 155.00 markers on the way down. This week’s US PCE data could extend the move if inflation surprises to the downside although, a print in line with expectations may continue the general move just at a slower pace. 151.90 and 150 flat present the next levels of support with the 200-day SMA in between the two levels – providing the next big test for yen bulls. USD/JPY Daily Chart Source: TradingView, prepared by Richard Snow BoJ to Decide if Weak Consumption is Likely to Delay Inflation Goal Next week Wednesday the BoJ will have to decide if recent uninspiring consumption figures are likely to stand in the way of the committee’s inflation goal. Markets expect a 62% chance of a rate hike of 0.1% to move the needle ever so slightly towards the neutral rate. The Bank will also provide greater detail around its plans to reduce its balance sheet by reducing the quantity of Japanese Government Bonds it purchases each month. Previously the BoJ sought to contain government borrowing costs to help stimulate the economy through fiscal spending initiatives. Now that the inflation and wages trend upwards, the Bank can afford to allow yields to rise. Higher yields often result in currency appreciation, especially against currencies linked to central banks that are now engaged in a rate cutting cycle. Market-implied probability of a 0.1% hike at next week’s BoJ meeting Source: LSEG Refinitiv, prepared by Richard Snow https://www.dailyfx.com/news/japanese-yen-s-comeback-analyzing-the-recent-market-shift-20240724.html