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Daily Market Analysis from Hotforex Broker
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[QUOTE="HFM, post: 203618, member: 32345"] [b]Date : 12th January 2022. Market Update – January 12 – Not as hawkish as priced in.[/b] [URL='https://analysis.hotforex.com/wp-content/uploads/2019/11/inflation_1200x628_2.png'][IMG]https://analysis.hotforex.com/wp-content/uploads/2019/11/inflation_1200x628_2-696x364.png[/IMG][/URL] Fed Powell, Mester and George, along with a 3-year auction added to the action in the markets. This saw yields pick up, and equities retreat. Commodities also caught a boost and oil touched pre-Omicron highs in Asia. [I]Powell confirmed the [B]shift to normalization[/B] and stressed the Fed will [B]fight inflation aggressively[/B], but also indicate[B]d liquidity would not be pulled back anytime soon.[/B] “FOMC would use its tool to ensure price pressures would not become entrenched, and would act aggressively if necessary.”.[B]Fed Chair Powell said inflation could last into mid-2022[/B] , while the Committee has not made any decisions on the timing of raising rates and allowing the balance sheet to shrink. He promised more clarity on that is coming soon[/I]. [LIST] [*]USD ([B]USDIndex[/B] [B]95.50[/B]) – 6-weeks low on less hawkish Powell than expected, while data indicate more room for policy easing in China. –[B][URL='https://www.scmp.com/economy/economic-indicators/article/3163037/china-inflation-consumer-factory-gate-prices-ease']China CPI inflation[/URL][/B] slowed to 1.5% y/y in December from 2.3% y/y. [*][B]Treasury yields are richer, [/B]with the US Yields 10-yr closing at 1.745%, and though the 2-year was only fractionally lower at 0.895%, it has managed to hold below the 0.90% level since March 2, 2020. [*][B]Equities[/B] – a drop in rates, saw yields up and helped underpin Wall Street where the [B]USA100[/B] outperformed with a 1.4% gain for the day, its best since December 21. The [B]USA500[/B] rallied 0.92%, and the [B]USA30[/B] was up 0.5%. [B]JPN225[/B] rose about 2%. Equities moved higher in [B]Japan[/B] and [B]Australia,[/B] with tech leading the rise once again. [*][B]BoJ’s Kuroda: “[/B][I]Japan’s inflation is set to accelerate gradually, and the Japanese economy is picking up as a trend.[/I]“ [*][B]Boeing[/B] and [B]Salesforce[/B].com led the [B]USA30[/B], while [B]Illumina[/B] topped the [B]USA500[/B], up 14% after giving better 2022 revenue guidance. The [B]energy sector rallied 3%,[/B] while [B]utilities were down 1%.[/B] [*][B]USOil[/B] – up at [B]81.06 & UKOIL [/B]at [B]83.98.[/B] [*][B]Gold[/B] -spiked to [B]$1823[/B]. [*][B]BTC[/B] steady close to at $40,000 support. [*][B]FX markets[/B] – [B]EURUSD[/B] at [B]1.1360[/B], [B]USDJPY steady at[/B] [B]115.30[/B],[B] Cable[/B] at 2-month high at [B]1.3645. – [/B]UK overcoming a wave of COVID-19 cases led by Omicron & priced in a nearly 80% chance of BoE rate hike in February. [/LIST] [B]European Open:[/B] The [B]GER30[/B] future is up 0.3%, the [B]UK100[/B] future 0.6%, as markets remain in [B]full risk on mood ahead of key US[/B] inflation data. Fed Chairman Powell yesterday seemed to provide some reassurance by sticking to the script. That will likely bring the German 10-year rate closer to lifting out of negative territory, as the ECB is still trying to reassure consumers that it is still committed to keeping inflation at bay, while at the same time trying to keep spreads in. A difficult balancing act that will get harder in the coming months. [B]Today [/B]– The December CPI headlines today. Results in line with forecasts would leave annual rates at a 7.0% y/y pace for the headline, a fresh 39-year high and besting that set in November at 6.8% y/y, and 5.4% y/y for the core versus 4.9% y/y, and a new 30-year high. [URL='https://analysis.hotforex.com/wp-content/uploads/2022/01/2022-01-12_09-40-54.jpg'][IMG]https://analysis.hotforex.com/wp-content/uploads/2022/01/2022-01-12_09-40-54.jpg[/IMG][/URL] [B]Biggest FX Mover[/B] @ (09:30 GMT) [B]USDCAD[/B] [B](-0.10%) [/B]Pullback to [B]1.4268 [/B]extending to November’s low area. Fast MAs keep sliding lower, MACD signal line & histogram turned below 0 line. RSI 38 and sloping lower, Stochastics entered OS area. [b]Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report.[/b] Click [url=https://www.hotforex.com/hf/en/trading-tools/economic-calendar.html][b]HERE[/b][/url] to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click [url=https://www.hotforex.com/en/trading-tools/trading-webinars.html][b]HERE[/b][/url] to register for FREE! [url=https://analysis.hotforex.com/][b]Click HERE to READ more Market news.[/b][/url] [b] Andria Pichidi Market Analyst HotForex Disclaimer:[/b] This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission. [/QUOTE]
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