Forex News MARKET OUTLOOK AND NEWS BY CAPITAL STREET FX

[CapitalStreetFx]

U.S. FUTURES LOWER AS EARNINGS FLOW​

U.S. stocks are set to edge lower at the open Tuesday, with investors turning cautious as the earnings season kicks into high gear ahead of a Federal Reserve meeting while uncertainty still exists over new fiscal stimulus.

S&P 500 Futures were trading 12.80 points or 0.40% lower, Nasdaq Futures declined 59 points, or 0.55% while the Dow Futures contract fell 123 points, or 0.46%, at the time of writing.

Senate Republicans on Monday proposed a $1 trillion coronavirus aid package, after securing agreement with the White House, paving the way for urgent negotiations with the opposition Democrats as expanded unemployment benefits for millions expire at the end of this week.

Meanwhile, the earnings season heats up, with this week set to see around a third of S&P 500 companies reporting. Pfizer and Raytheon Technologies have impressed with their quarterly results, while McDonald’s and 3M have disappointed.

The Federal Reserve’s Federal Open Market Committee begins the latest of its regular two-day meetings later Tuesday. Expectations are for the central bank to maintain rates near zero but there is speculation that the Fed may guide for a further relaxation of policy before too long.

Fed policymakers have become more downbeat on the economic outlook in recent weeks, with some cautioning that recent improvements in economic data such as job gains may be fleeting amid resurgence in the coronavirus pandemic.

Economic numbers will come in the form of house price data from S&P/Case Shiller at 7 AM ET, the Conference Board’s consumer sentiment index at 8 AM and the Richmond Fed’s regional business survey also at 8 AM.

Oil prices remained largely unchanged on Tuesday with U.S. crude futures traded 0.36% lower at $41.45 a barrel, while the international benchmark Brent contract rose 0.09% to $43.94.

Traders will be watching out for the U.S. inventory data due from the American Petroleum Institute industry group later on Tuesday.

Elsewhere, gold futures fell 0.04% to $1,930.25/oz after earlier hitting a record high of $1,974.40 per ounce, surpassing a peak touched in September 2011.

On the technical front, the RSI is at 52.85% and suggests that the market can move in an upward direction. The current price is trading above all the moving averages. The stochastic is forming a downside crossover.

Overall Bias is Positive and Short-term trades can be initiated with below mentioned Stop Loss and Profit targets.

Trade Suggestion—DOW JONES—SHORT SELL at 26400 Take Profit at 25900 Stop Loss at 26750

 

[CapitalStreetFx]

MARKET OUTLOOK - 31st JULY 2020​

U.S. FUTURES HIGHER ON TECH GIANTS STELLER RESULTS
U.S. stocks are set to open higher on Friday with the tech-heavy Nasdaq index set to outperform after stellar results from Apple, Amazon and Facebook.
S&P 500 Futures were trading 9.70 points or 0.30% higher, Nasdaq Futures increased 129 points or 1.20% while the Dow Futures contract rose 49 points or 0.19%, at the time of writing.
Apple, Amazon, Alphabet, and Facebook have driven markets higher in recent weeks with the market capitalization of these four tech giants combined now making up 38% of the Nasdaq 100 index.
Investors will also observe negotiations over the next coronavirus stimulus as the Covid-19 pandemic’s second wave continues to work its way through the central U.S.
Elsewhere, U.S. lawmakers are still struggling to find enough common ground to pass another stimulus package, a key sticking point being the $600 weekly pandemic unemployment benefit which expires later Friday. A Republican proposal to slash that to $200 a week was rejected on Thursday.
The enhanced unemployment benefit ($600 a week) has been a cornerstone in the rebound in consumption that was seen during May and June, and a failure to prolong the program will probably add fuel to the stalling fire.
The U.S. economy is already showing signs of stress. Initial jobless claims climbed to 1.43 million last week, rising for the second straight week.
The US economy contracted by an unprecedented annualized rate of 32.9% in the second quarter, as reported by the Commerce Department on Thursday. This quarter posted the worst decline since the Great Depression, as the coronavirus pandemic hammered consumer spending.
Friday will feature reports on personal income and spending at 8:30 AM ET, and the University of Michigan Consumer Sentiment at 10 AM ET.
Meanwhile, the earnings season continues with the likes of Merck, ExxonMobil, Chevron, Colgate-Palmolive reporting on Friday. Caterpillar which is a closely watched proxy for business investment rose 1.8% in pre-market trading after handily beating expectations on both top and bottom lines. Under Armour stock rose 19% after its second-quarter results proved less dire than feared.
Oil prices edged higher recovering from three-week lows hit on Thursday in reaction to the U.S. GDP and jobless claims numbers.
The Organisation of Petroleum Exporting Countries will soon become the focus after the group decided earlier this month to dial back production cuts, a move that will see an increase in production of about 2 million barrels per day starting in August.
U.S. crude futures traded 0.95% higher at $40.30 a barrel while the international benchmark Brent rose 0.55% to $43.49, at the time of writing.
Elsewhere, gold futures rose 1.40% to $1,969.50/oz while EUR/USD traded at 1.1844, largely unchanged.
On the technical front, the RSI is at 48.50% and suggests that the market can move in an upward direction. The current price is trading above the 5 days Moving Average but is trading below 20 days and 50days moving averages. The stochastic is forming an upside crossover.
Overall Bias is Positive and Short-term trades can be initiated with below mentioned Stop Loss and Profit targets.
Trade Suggestion—BUY at 26250 Take Profit at 26600 Stop Loss at 25950

 

[CapitalStreetFx]

TOP 5 MARKET NEWS - 18th Aug 2020​

Fear Of No Stimulus Could Lead To Credit Losses Weighing On Financials.
Financials were among Monday's worst-performing sectors following a regulatory filing last week that said Warren Buffett's Berkshire Hathaway B had pared back some of its bank stock holdings. But investors are also worried about the delay in another round of stimulus that could lead to a worsening of credit quality at major lenders.
So far, damage seems to be contained. On Monday, American Express Company reported its card numbers for July. Consumer card member loans were written off at a rate of 2.6% versus 2.6% for the prior month.

2. Tech Fuelled 'Everything's Awesome' Rally Looks Unstoppable.
Today's $72 trillion question for investors: To buy or not to buy into the global equities rally? Notwithstanding inflated share prices, politics and the pandemic, the answer from many is a resounding "yes."
That's not just because unprecedented stimulus - $20 trillion and counting - is forcing a structural change in how financial assets are valued. It's also down to years of societal shifts, innovation and now, the pandemic, which could transform forever the way people work, study and shop - playing into the dominant hand of tech stocks.

3. German Engineering Exports Plunge In Second-quarter As Pandemic Takes Toll: VDMA
German engineering exports slumped by 22.9% in the second quarter as the coronavirus pandemic and the lockdown imposed to curb it took their toll on this mighty sector of Europe's biggest economy, engineering association VDMA said on Tuesday.
Exports dropped by 14.1% in the first half of 2020 compared to a year earlier, VDMA said.

4. Japan's Low Jobless Rate Masks Deepening Worker Despair.
Japan's low unemployment rate on paper suggests an economy weathering the coronavirus reasonably well, but official figures belie worsening prospects for the country's army of temporary workers, who make up about 40% of the jobs market.
A rise in job losses would undermine one of the few successes of Prime Minister Shinzo Abe's "Abenomics" stimulus policies, aimed at reviving the economy. Japan's jobless rate stood at 2.8% in June, much lower than 10.2% in the United States and 7.8% in the 19-member euro zone.

5. New U.S. Sanctions To Slam Huawei, Further Roil Tech Supply
Ramped-up U.S. restrictions on Huawei are likely to cut off the Chinese smartphone maker's access to even off-the-shelf chips and disrupt the global tech supply chain once again, executives and experts cautioned.
The Trump administration on Monday expanded its curbs on Huawei and banned suppliers from selling chips made using U.S. technology to the firm without a special license - closing potential loopholes in its May sanctions that could have let Huawei access the tech via third parties.

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[CapitalStreetFx]

MARKET OUTLOOK - 18TH AUG, 2020
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BREXIT AND PMI OUTLOOK UNCERTAINTY DAMPENING POUND STERLING TO EURO EXCHANGE RATE MOVEMENT
With 2020 heading quickly towards its final quarter with no notable developments in UK-EU Brexit negotiations all year, fears of a no-deal outcome to Brexit continue to dampen Britain’s economic outlook and Sterling.

Investors are losing confidence and are hesitant to keep buying the already strong Euro (EUR), the Pound Sterling to Euro (GBP/EUR) exchange rate has been increasingly flat since last week. This morning’s attempts at a rebound were short-lived and investors now await upcoming Brexit talks.
Last week saw GBP/EUR briefly jump from the level of 1.1076 to a high of 1.1146 – the pair’s best level in around a month. However, after touching this high, GBP/EUR tumbled again and closed the week at the level of 1.1050.

This week’s movement has been even narrower so far. GBP/EUR briefly slipped to an August low of 1.1027 yesterday. At the time of writing though, GBP/EUR is trending closer to the week’s opening levels again. As well as Brexit negotiations, investors are awaiting key PMI data due towards the end of the week.
On the technical front, the RSI is at 49.63% and suggests that the market can move in the downward direction. The current price is trading below all the moving averages.

The stochastic is forming a downside crossover and indicates the mildly bearish trend.

Overall Bias is negative and Short-term sell trades can be initiated with below mentioned Stop Loss and Profit targets.

Trade Suggestion–SELL EUR/GBP at 0.90491 Take Profit at 0.90114 Stop Loss at 0.90732


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[CapitalStreetFx]

TOP 5 MARKET NEWS - 19th Aug 2020​

1. FED Meetings Minutes Out At 2 PM EST.
The minutes of the latest Federal Reserve meeting will be published in the afternoon. The wise words may provide some insight into how the central bank sees the recovery playing out, Reuters said. The Fed has cut rates to near zero to bolster business through the pandemic.
The minutes offer detailed insights regarding the FOMC's stance on monetary policy, so currency traders carefully examine them for clues regarding the outcome of future interest rate decisions.

2. No New U.S.-china Trade Talks Scheduled: White House Chief Of Staff.
No new high-level trade talks have been scheduled between the United States and China but the two sides remain in touch about implementing a Phase 1 deal, White House Chief of Staff Mark Meadows told reporters aboard Air Force One on Tuesday.
U.S. President Donald Trump earlier told reporters during a visit to Yuma, Arizona, that he had postponed an Aug. 15 review of the trade agreement signed with China in January given his frustration over Beijing's handling of the coronavirus pandemic.

3. U.S. Official Sees 'real Desire' For Smaller Coronavirus Relief Bill
Some Democrats and Republicans have a "real desire" to reach agreement on a smaller coronavirus relief bill that could be worth around $500 billion, a senior Trump administration official said late on Monday.
The official said the agreement could include funding for the U.S. Postal Service, additional funding for loans to small- and medium-sized businesses to keep workers on their payrolls and potentially added money for schools.

4. Oil Prices Skid As Concerns Over U.S. Demand Recovery Seep Through Market
Oil prices slid on Wednesday as concerns grew that U.S. fuel demand may not recover quickly amid stalled talks on a post-coronavirus economic stimulus package, overshadowing a bigger-than-expected drawdown in U.S. crude stocks.
With investors keeping one eye on a key producer countries' ministerial meeting later in the day, Brent Crude futures fell 38 cents, or 0.8%, to $45.08 a barrel, having edged up 9 cents on Tuesday. U.S. WTI crude futures was down 25 cents, or 0.6%, at $42.64 a barrel.

5. Earnings Watch: Nvidia, Lowe, Target And More.
Nvidia is expected to report earnings per share of $1.98 on sales of $3.65 billion. The company has beat expectations over the past five quarters. Lowe's is estimated to report $2.83 on sales of $23.88 billion. Home Depot fell despite the good news, as stimulus dries up and reality hits.
TJX is expected to publish a loss per share of 11 cents on sales of $6.46 billion. Shares are up 63% since March. Target may report earnings per share of $1.58 on sales of $19.87 billion. The stock is up 50% since March, and will follow Walmart's record online sales published Tuesday.



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[CapitalStreetFx]

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[CapitalStreetFx]

MARKET OUTLOOK - 20TH AUG, 2020​

THE CLOCK IS TICKING ON THE DOLLAR’S LONG-ENDURING BULL CYCLE - CAPITAL STREET FX

THE CLOCK IS TICKING ON THE DOLLAR’S LONG-ENDURING BULL CYCLE
After nine years of strength, the currency is being assailed from all sides. This year, the Federal Reserve joined other central banks in slashing interest rates to rock-bottom levels, wiping out the dollar’s advantage vis-à-vis the euro and yen. Ballooning debt and deficits have eroded foreign investment in the U.S. And trade-weighted measures suggest the dollar’s decline is overdue.

The dollar has been overvalued for a long time, and this might finally be a catalyst for a multi-year downtrend. As we’ve seen before when valuations have been stretched, a policy or economic shock can quickly change the currency’s trajectory and that’s what seems to be happening thanks to the Fed’s swelling balance sheet, a surge in debt, and the way we handled the pandemic.

The currency still accounts for more than 60% of global reserves and is the most widely used for international transactions by far. What’s more, the end of the bull run doesn’t necessarily mean the end of the dollar. History suggests that once triggered, dollar strength could quickly unravel.

The first bull cycle occurred between 1980 and 1985, when the greenback almost doubled in value. But once the world’s richest nations signed the Plaza Accord to depreciate the dollar and help the U.S. pull out of its recession, the dollar soon lost all of that and more.

The second cycle began around 1995 and lasted seven years before ending amid speculation President George W. Bush wanted a weaker currency to boost exports and manufacturing. The greenback went on to slump 33% in the following two years.

On the technical front, the RSI is at 45.80% and suggests that the market can move in the downward direction. The current price is trading below all the moving averages. The stochastic is forming a downside crossover.

Overall Bias is negative and Short-term sell trades can be initiated with below mentioned Stop Loss and Profit targets.


Trade Suggestion– SELL USD/JPY at 105.852 Take Profit at 104.826 Stop Loss at 107.115


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[CapitalStreetFx]

TOP 5 MARKET NEWS - 20th Aug 2020​

1. Initial Jobless Claims Out At 8:30 AM EST. Initial jobless claims fell below 1 million in August for the first time since the coronavirus pandemic began almost five months ago, signaling a steady if slow revival in a battered U.S. labor market.New applications for unemployment benefits are expected to decline to 925K from 963K last week.

2. Fed To Cut One-week Dollar Swap Operations With Major Central Banks. The U.S. Federal Reserve will cut the number of seven-day swap operations with major central banks to one tender per week from three from Sept. 1 as funding conditions have improved, the European Central Bank said in a statement on Thursday. The Fed will, however, maintain its schedule for 84-day tenders with the Bank of England, the Bank of Japan, the ECB and the Swiss National Bank at one per week, the ECB said.

3. China, United States Agree To Hold Trade Talks, Chinese Commerce Ministry Says. China and the United States have agreed to hold trade talks "in the coming days" to evaluate the progress of their Phase 1 trade deal six months after it took effect in February, the Chinese commerce ministry said on Thursday. Ministry spokesman Gao Feng made the comments at a weekly briefing held online, but did not elaborate. They followed Tuesday's remarks by White House Chief of Staff Mark Meadows that no new high-level trade talks were scheduled, though both sides were in touch about implementing the Phase 1 deal.

4. China Vows All Necessary Measures To Protect Firms Following U.S. Curbs On Huawei. China will take "all necessary measures" to protect its firms' legitimate interests, the Commerce Ministry said on Thursday, in response to the U.S. move this week to further tighten restrictions on Huawei Technologies Co. The Trump administration on Monday expanded restrictions announced in May aimed at preventing the Chinese telecommunications giant from obtaining semiconductors without a special license, and added 38 Huawei affiliates in 21 countries to the U.S. government's economic blacklist in its crackdown on its access to commercially available chips.

5. Facebook Wins Preliminary Approval To Settle Facial Recognition Lawsuit. Facebook Inc. won preliminary approval late on Wednesday from a federal court for settlement of a lawsuit that claimed it illegally collected and stored biometric data of millions of users without their consent. The social media company had in July raised its settlement offer by $100 million to $650 million in relation to the lawsuit, in which Illinois users accused it of violating the U.S. state's Biometric Information Privacy Act.

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[CapitalStreetFx]

Trade Signals - 15th Sept 2020​

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[CapitalStreetFx]

The Report is Prepared By CapitalStreetFx Presents Major Moves in the Asia-Pacific market as of 6th Nov. 2020.


Asian shares at near three-year peak; dollar, U.S. yields head south A gauge of Asian shares rallied to a near three-year peak while the dollar stayed sluggish and U.S. bond yields slipped on Friday in anticipation that a divided U.S. legislature would limit major policy changes and keep the status quo on economic policies.

Investors expect Democrat Joe Biden to beat President Donald Trump and the Republicans to retain control of the Senate, allowing them to block the Democrats' agenda, such as corporate tax hikes and massive borrowing for large spending.

Japan’s NIKKEI 225 average rose 0.7% to almost its best level in 30 years while MSCI's broadest gauge of Asian Pacific shares outside Japan rose 0.3%.

U.S. S&P futures dropped 0.3% in early Asian trade, a day after the underlying stock index rose by 1.95%. U.S. Treasury yields drifted lower again as investors bet that a divided U.S. government will cap debt-funded government spending and limit bond supply.

Ten-year Treasury yield edged lower to 0.773%, more than 150 basis points below the pre-U.S. election level seen on Tuesday. It had struck a three-week low of 0.7180% on Thursday.

The Tokyo market’s index Nikkei 225 closed UP by 0.99% at 24,345.90 and the topix 100 closed at 0.41% at 1060.91 higher. Hong Kong’s Hang Seng index was down by 0.22 % to 25,632.05. Mainland Chinese stocks also edged lower today, as the Shanghai Composite climbed down by 0.71% to about 3,296.05. South Korea’s Kospi climbed down by 0.02% to 2,414.89. Shares in

Australia also saw again, with the S&P/ASX 200 inched up by 0.58% to 6,128.90, at the time of writing.

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[Slinger]

View attachment 9998
U.S. FUTURES LOWER AS EARNINGS FLOW​

U.S. stocks are set to edge lower at the open Tuesday, with investors turning cautious as the earnings season kicks into high gear ahead of a Federal Reserve meeting while uncertainty still exists over new fiscal stimulus.

S&P 500 Futures were trading 12.80 points or 0.40% lower, Nasdaq Futures declined 59 points, or 0.55% while the Dow Futures contract fell 123 points, or 0.46%, at the time of writing.

Senate Republicans on Monday proposed a $1 trillion coronavirus aid package, after securing agreement with the White House, paving the way for urgent negotiations with the opposition Democrats as expanded unemployment benefits for millions expire at the end of this week.

Meanwhile, the earnings season heats up, with this week set to see around a third of S&P 500 companies reporting. Pfizer and Raytheon Technologies have impressed with their quarterly results, while McDonald’s and 3M have disappointed.

The Federal Reserve’s Federal Open Market Committee begins the latest of its regular two-day meetings later Tuesday. Expectations are for the central bank to maintain rates near zero but there is speculation that the Fed may guide for a further relaxation of policy before too long.

Fed policymakers have become more downbeat on the economic outlook in recent weeks, with some cautioning that recent improvements in economic data such as job gains may be fleeting amid resurgence in the coronavirus pandemic.

Economic numbers will come in the form of house price data from S&P/Case Shiller at 7 AM ET, the Conference Board’s consumer sentiment index at 8 AM and the Richmond Fed’s regional business survey also at 8 AM.

Oil prices remained largely unchanged on Tuesday with U.S. crude futures traded 0.36% lower at $41.45 a barrel, while the international benchmark Brent contract rose 0.09% to $43.94.

Traders will be watching out for the U.S. inventory data due from the American Petroleum Institute industry group later on Tuesday.

Elsewhere, gold futures fell 0.04% to $1,930.25/oz after earlier hitting a record high of $1,974.40 per ounce, surpassing a peak touched in September 2011.

On the technical front, the RSI is at 52.85% and suggests that the market can move in an upward direction. The current price is trading above all the moving averages. The stochastic is forming a downside crossover.

Overall Bias is Positive and Short-term trades can be initiated with below mentioned Stop Loss and Profit targets.

Trade Suggestion—DOW JONES—SHORT SELL at 26400 Take Profit at 25900 Stop Loss at 26750

What a perfect entry for down jones