Forex Live News Feed

  • Citi indicator at levels last reached in 2000, 2007: "after which global equities halved"
    <p>Posting this as an ICYMI. Dow Jones news/Market Watch have the piece, highlighting </p><blockquote> a fat red flag investors may want to heed</blockquote><p>It's an index calculated by Citigroup equity stategists of global sell-side recommendations:</p><blockquote>“Our index of global sell-side recommendations is back to peak bullishness levels reached in 2000 and 2007, after which global equities halved” “Analysts are net buyers of every sector in every region, but then they usually are,”</blockquote><blockquote>“They are still bullish on cyclical sectors suggesting few fears of oncoming global recession.”</blockquote><p>Here is the <a href="" target="_blank" rel="nofollow">link to the Market Watch article</a>, which does caveat with:</p><blockquote>Citi’s bear market checklist, which has eased to 6 from a potential 18 flags. Note, this particular flag gave a false sell signal in 2012, when global stocks were flat for the following 12 months. </blockquote><p class="western" align="left"> This chart is from our charting app, which is free and <a href="">can be found at this link</a></p> This article was written by Eamonn Sheridan at Read more »
  • Trade ideas thread - Wednesday, 10 August 2022
    <p>Good morning, afternoon and evening all. Any charts, technical analysis, trade ideas, thoughts, views, ForexLive traders would like to share and discuss with fellow ForexLive traders, please do so: </p> This article was written by Eamonn Sheridan at Read more »
  • Morgan Stanley on CPI data due Wednesday, 10 August - could be catalyst for a higher USD
    <p>Inflation data from the US due today, Wednesday 10 August 2022:</p><p>Morgan Stanley is looking for a higher USD (summary<a href="" target="_blank"> here from yesterday</a>)</p><p>A little more from MS, this time specifically on the data and a likely impact:</p><ul><li>We think the market is underestimating the stickiness of US inflation, the Fed's resolve in tackling it, and the necessary tightening required to achieve lower inflation. </li><li>US CPI on August 10 may be a critical market catalyst for the next leg of the USD rally should it exceed market expectations</li></ul> This article was written by Eamonn Sheridan at Read more »
  • Forexlive Americas FX news wrap: Dollar tilts higher ahead of CPI. Stocks lower.
    <ul><li><a href="">USD ticks higher as the day works toward the close</a></li><li><a href="">Oil gives back gains, settles 26-cents lower ahead of weekly supply reports</a></li><li><a href="">Crude oil settles at $90.50</a></li><li><a href="">There is a profound disconnect in battery metals</a></li><li><a href="">The US treasury auctions off $42 billion of 3 year notes at a high yield 3.202%</a></li><li><a href="">Risk trades fade as meme stocks unwind and CPI eyed</a></li><li><a href="">US EIA sees slower US demand and supply growth in 2022</a></li><li><a href="">European equity close: German stocks lag</a></li><li><a href="">UK plans for possibility of power cuts to industries and homes in January</a></li><li><a href="">US Redbook weekly retail sales +10.4% y/y vs +15.5% prior</a></li><li><a href="">The EUR is strongest and the AUD is the weakest as the NA session begins</a></li><li><a href="">US Q2 unit labor costs +10.8% vs +9.5% expected</a></li><li><a href="">ForexLive European FX news wrap: One of those summer's day</a></li></ul><p>The dollar moved higher in the US session (from the NY open). Helping the move was higher yields, and perhaps some anxiety about the CPI data which will be released tomorrow at 8;30 AM. The headline number is expected to rise 0.2% MoM/8.7% YoY. That is lower than the 1.3% and 9.1% last month. However, the core is expected to rise 0.5% MoM and 6.1%… Read more »
  • Oil - private survey of inventory shows larger than expected headline build
    <p>This is from the privately surveyed oil stock data ahead of official government data tomorrow morning out of the US.</p><p>Via Twitter:</p><p>Expectations I had seen centred on:Headline crude +100k barrelsDistillates +-0.7 mn bblsGasoline -0.6 mn bbls</p> This article was written by Eamonn Sheridan at Read more »
  • US equities struggle ahead of CPI as meme stocks fade
    <ul><li>S&P 500 -0.4%</li><li>Nasdaq -1.2%</li><li>Russell 2000 -1.7%</li><li>DJIA -0.2%</li></ul><p>That's a fair amount of divergence. Small cap and tech stocks struggled badly while megacap held up ok. Meme stocks exploded higher yesterday but struggled today:</p><ul><li>GME -6.3%</li><li>AMC -6.3%</li><li>BBBY -14.2%</li><li>HKD -48%</li></ul><p>A high CPI reading tomorrow will be a major challenge to the recent optimism in markets.</p> This article was written by Adam Button at Read more »
  • There's a bull market in obscure inflation measures
    <p>On Wednesday, the highlight of the week on the economic calendar is due with the release of the July CPI report.</p><p>Here's the consensus on the headline:</p><ul><li>+8.7% y/y</li><li>+0.2% m/m</li></ul><p>And core:</p><ul><li>+6.1% y/y</li><li>+0.5% m/m</li></ul><p>One of the measures that's increasingly popular is the Cleveland Fed's CPI nowcast. They're close to consensus with:</p><ul><li>+8.82% y/y</li><li>+0.27% m/m</li></ul><p>And core:</p><ul><li>+6.05% y/y</li><li>+0.48% m/m</li></ul><p>The other thing that people are watching are private sector reports. One is the Adobe Digital Price Index, which measures the prices of things online. It fell in July year-over-year data for the first time in two years.</p><p>Overall the market is certainly indicating that prices will fall but whether that settles at 2% or closer to 4% isn't going to be revealed in any data just yet.</p><p>But markets are prepared to move on whether the Fed goes 50 bps or 75 bps in September. Right now, the Fed funds <a href="" target="_blank" id="2037a59d-f6cf-44c1-a57d-162e04589957_1" class="terms__main-term">futures</a> market is priced 67.5% in favor of 75 bps.</p> This article was written by Adam Button at Read more »
  • Whats on the economic calendar in Asia on Wednesday, 10 August 2022 - China inflation data
    <p>China's headline CPI reading (data for July is published today) is expected to nudge up towards 3%. The wave of inflation that has engulfed everywhere else on the planet has not shown up to anywhere near the same extent in official Chinese data. 3% is the upper edge of the government target for inflation. The Chinese Communist Party pulling the levers on the economy (or, trying to) have had room to move with more fiscal and monetary support given the low reported rates of inflation. At or above 3% would pose a challenge. The tolerance for inflation may have to be raised, or extra stimulus trimmed back with a flow on effect to less propping up of the economy, its being engulfed by an imploding property sector and domestic demand that has been hit by ongoing waves of COVID-related lockdowns and restrictions. </p><p>Of direct impact, Communist Party officials through the National Development and Reform Commission of the People's Republic of China (NDRC) - the state planner - have been trying to contain fast-rising pork prices. These are a major component of the CPI data. </p><p class="western" align="left"> This snapshot from the ForexLive economic data calendar, <a href="">access it here</a>.</p><p class="western"… Read more »
  • Oil gives back gains, settles 26-cents lower ahead of weekly supply reports
    <p>WTI crude oil rose as high as $92.65 on news of curbed Russia pipeline flows but later gave back the gains to settle 26-cents lower to $90.50.</p><p>The private oil inventory data from the API is due at 4:30 pm ET and will be the next market mover. The consensus for this week's EIA report due on Wednesday is:</p><ul><li>Crude +73K</li><li>Gasoline -633K</li><li>Distillates -667K</li></ul><p>But all eyes will be on <a href="" target="_blank">curiously low</a> implied demand figures in the EIA report. That contrasts with private data showing ongoing healthy demand.</p><p>Meanwhile, today US national average gas prices <a href="" target="_blank" rel="nofollow">hit </a>$3.99 per gallon for the first time in months.</p> This article was written by Adam Button at Read more »
  • Crude oil settles at $90.50
    <p>The price of crude oil is settling at $90.50, that is down -$0.26 or -0.29% on the day. </p><p>The high price reached $92.62. The low price reached $89.06. The price fell below the 100 hour MA at $89.95 but could not sustain momentum below the level. </p><p>At the high today the price stalled at the 38.2% of the move down from the end of July high. That level comes in at $92.67. </p> This article was written by Greg Michalowski at Read more »
  • EUR/USD recovery near end; stay bearish for 0.9900 target - Credit Suisse
    <p>Credit Suisse discusses EUR/USD technical outlook and maintains a core bearish bias.</p><p>"EURUSD remains below the 38.2% retracement of the May/Jul y fall and recent high at 1.0271 and last Friday has seen another bearish “reversal day” to reinforce the one seen at the be ginning of the week. This should further increase the likelihood that the corrective recovery is coming to an end," CS notes. </p><p>Support stays seen at 1.0122/14 initially, with a break below 1.0097 still seen needed to clear the way for a retest of our long-held parity/.990 0 objective and the current YTD low. An eventual break lower in due course can see the next meaningful support at .9609/.9592. </p><p>Resistance is seen at 1.0253/54, with 1.0294 ideally capping to keep the immediate risk lower. Above can see a deeper but still corrective recovery to test the point-of-breakdown from the bearish continuation pattern at 1.0341/66," CS adds.</p> This article was written by Adam Button at Read more »
  • There is a profound disconnect in battery metals
    <p>Three headlines hit today:</p><ul><li>GM says it's open to funding EV battery minerals mining ventures</li><li>Ford raised the price of the electric F-150 Lightning truck by up to $8,500 due to 'significant cost increases'</li><li>Tesla signed a $5 billion deal for nickel from processing companies in Indonesia</li></ul><p>There's clearly a supply shortage here and auto companies are making moves to secure materials. Meanwhile, nickel prices are down 40% since March and prices are nowhere near high enough to incentivize the needed production.</p><p>It's the same in copper markets where miners with 30 years of inventory are trading at dirt cheap multiples based on current prices rather than where prices will go as the green transition ramps up.</p><p>What's scary is the it's getting even harder to build mines. A large portion of mining capex is energy costs and with oil prices near $100, it will make it tougher to start new projects. Add in labor inflation, higher interest rates and a new mine today might cost 50% more than 5 years ago.</p><p>It also ignores the profound timing disconnect between when metals will be needed and how long it takes to get production. One of the final mega-projects that's scheduled to come online this decade is Quebrada… Read more »
  • The US treasury auctions off $42 billion of 3 year notes at a high yield 3.202%
    <ul><li>High yield 3.202%</li><li>Tail -0.3 BPS vs avg of 0.1 bp</li><li>Bid to cover 2.5x vs six-month average of 2.47X</li><li>Directs 17.28% vs six-month 18.05%</li><li>Indirects 63.08% vs six-month average of 60.4% </li><li>Dealers 19.64% vs. six-month average of 23.47%</li></ul><p>Auction Grade: B+</p><p>Highlights:</p><p>Above average components:</p><ul><li>negative tail</li><li>bid to cover higher than average</li><li>international demand from indirect bidders higher than taverage</li><li>dealers were saddled with much less than what is average</li></ul><p>Below average component:</p><ul><li>domestic demand is lower than the average</li></ul> This article was written by Greg Michalowski at Read more »
  • Risk trades fade as meme stocks unwind and CPI eyed
    <p>A flat start in US stocks has given way to selling, led by the Nasdaq.</p><p>Yesterday's high-flying meme stocks have given much back. The resurgence of the likes of GME, AMC and BBBY were a sign that froth had returned to the market. </p><p>Some are also pointing to the Cleveland Fed's CPI tracker as an indication that tomorrow's US CPI report will be on the hot side. The consensus is 8.7% but it points to a 8.8% reading. That said, some of the core metrics in it are a touch softer than consensus.</p><p>In any case, the consequences of a hot reading will probably hurt the market more than vice versa.</p><p>In terms of technicals, I don't love using a Fibonacci retracement in this situation because that early-June bounce makes it messy but a failure right in the 50%-61.8% range would make sense if this is bear-market rally.</p> This article was written by Adam Button at Read more »
  • US EIA sees slower US demand and supply growth in 2022
    <p>The focus on tomorrow's EIA weekly oil inventories will remain on the demand side of the equation as there is concern about signs of unusually low gasoline consumption.</p><p>Meanwhile, the monthly report is out and sees:</p><ul><li>2022 demand to rise 560k bpd compared to 700k bpd in last month's report</li><li>2022 supply to rise 610k bps vs 720k bpd in last month's report</li><li>2023 demand to rise 410k bps vs 320k bpd in last month's report</li><li>2023 supply to rise 840k bpd vs 860k bpd in last month's report</li><li>2023 world oil demand to rise 2.06m bpd vs 2.00m bpd in last month's report</li></ul><p>I've never seen any value in this report. It's guesswork, the same as any private forecast and the track record isn't that good. What worries me a bit is falling US supply estimates both this year and next year. The Permian is a great basin but other US oil plays are struggling to generate investment due to high decline rates.</p><p>In terms of spot, crude is now lower by 40 cents on the day but that selling came before this report.</p> This article was written by Adam Button at Read more »
  • US treasury is auction of $42 billion of 3 year notes at the 1 PM ET
    <p>The US treasury will auction off $42 billion of 3 year notes at 1 PM ET today. </p><p>The 6 month averages of the major components shows:</p><ul><li>Bid to cover, 2.47X</li><li>Directs, 18.05%</li><li>Indirects, 58.48%</li><li>Dealers, 23.47%</li><li>Tail 0.1 basis points</li></ul><p>Tomorrow the treasury will auction off 10 year notes. On Thursday, they will auction off 30 year bonds</p><p>Yields in the US today are higher with the biggest gains in the short end:</p><ul><li>2 year yield 3.27%, +5.8 basis points</li><li>3 year yield 3.205, +6.2 basis points</li><li>10 year yield 2.73%, +2.2 basis points</li><li>30 year 2.995%, +1.0 basis points</li></ul> This article was written by Greg Michalowski at Read more »
  • European equity close: German stocks lag
    <p>Closing changes:</p><ul><li>Stoxx 600 -0.6%</li><li>UK FTSE 100 +0.1%</li><li>German DAX -1.0%</li><li>French CAC -0.5%</li><li>Italy MIB -1.0%</li><li>Spain IBEX +1.0%</li></ul><p>The DAX initially opened only slightly lower but steadily sank until midday in Frankfurt before heading sideways. It's now at a four-day low.</p> This article was written by Adam Button at Read more »
  • UK plans for possibility of power cuts to industries and homes in January
    <p>A report is circulating that the UK has drawn up plans for potential power cuts to homes and industries in January. That comes with earlier reports about Norway cutting back on energy supplies due to low rainfall.</p><p>The report says it's the 'worst case scenario' that officials are planning for.</p><p>Obviously, cutting power is a major drag for GDP and investment but this is more of a tail risk than any kind of baseline.</p><p>Cable has dipped to 1.2095 from 1.2115.</p> This article was written by Adam Button at Read more »
  • GBP/USD: Stable into US CPI but unlikely To hold levels above 1.2000 - MUFG
    <p>MUFG Research discusses GBP outlook and maintains a bearish bias in the near-term. </p><p>"The pound along with most of the rest of G10 FX is broadly stable so far this morning with little news to drive volatility – a feature that may persist until we get the key inflation data from the US tomorrow...Separate reports highlighted the potential strains ahead for consumers being squeezed by rising costs of essentials. Research from property site Zoopla revealed rental growth of nearly 20% in inner London in Q1 2022 and 10% in outer London growth in Q1 2019 was 2%. That is fuelling significant increases in rents reinforced by a marked drop in supply," MUFG notes </p><p>"So the outlook for consumer spending remains grim with the potential for much greater public sector strike action than on the continent. The nursing union RCN – is recommending strike action by its 465k members which would be the first ever strike by nurses in the UK. GBP/USD will be unable to hold levels above 1.2000 as downside risks persist," MUFG adds. </p><p>For bank trade ideas, <a href="" rel="nofollow" target="_blank" data-saferedirecturl="">check out eFX Plus</a>. For a limited time, get a 7 day free trial, basic for $79… Read more »
  • US stock declines deepen. NASDAQ down -1.3%
    <p>The stock declines are deepening a bit with the NASDAQ reaching down -1.3%. The S&P index is down -0.45% and the Dow industrial average is now lower after a early rise. It is currently down -0.13%.</p><p>The S&P index is looking to test its 100 day moving average of 4114.17. It's a low price reached for 4118.95 so far.</p><p>For the <a href="" target="_blank" id="73ea5227-7971-4d75-a878-f20ede81c27e_2" class="terms__main-term">NASDAQ</a> index, it's 100 day moving average comes in at 12318.23. The low price reached 12479.52 so far.</p><p> Him</p> This article was written by Greg Michalowski at Read more »