MongiIG
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Early Morning Call: Europe expected down; China economic data disappoints and USD falls
Europe expected to open lower after Asia markets drop. Meanwhile, economic data in China disappoints on rising Covid-19 fears, despite fractionally improved GDP. And, USD falls amid lowest US consumer sentiment in almost a decade.
This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.
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1 hour ago, RFSmithers said:
Completed IG's Planning and Risk Management Course today.
Hi @RFSmithers, that is great and well done. How did you find the course and what course are you planning on doing next ?
MongiIG
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For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.
Today’s coverage:
Indices: Europe expected to open lower after Asia mkts drop. China economic data disappoints and NYK down, despite fractionally improved GDP, on rising Covid fears
FX: USD falls as US consumer sentiment at lowest in almost a decade. ¥ falls as Japan covid cases rise
Equities: Watching BHP on confirmation oil unit talks on a possible sale to WPL. Earnings looking ahead to US retail WMT HD
Commods: Soft commodities continue to rise as crops suffer from weather effects. Brent back below $70 as US rig count back up over 500. Gold starts the week down
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What to trade the week starting 16 August: Fed, RBA minutes; NVDA, HD, WMT earnings
With the summer lull now well and truly upon us, the calendar is a little lighter than would otherwise be the case, but there are still some pockets of interest.
Most notably the minutes from both the Federal Reserve and Reserve Bank of Australia, so watch out for AUD and USD trades.
On the corporate calendar there’s NVDA, HD and WMT to keep equity specialists interested.
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Gold moves higher while oil rally fizzles out
Gold continues to claw back losses from earlier in the week, but oil has seen its bounce lose momentum.
Source: Bloomberg
Gold
The gold price continues to climb, reversing much of the negativity from earlier in the week. As noted before, a recovery above $1765 is still needed to allow longs to breathe more easily, but it has been a good week overall for the bulls.
Further gains target $1800 and then $1830. So far there is no sign of a reversal, but if one develops $1685 remains the first downside target.
Source:ProRealTime
WTI
Hopes of further gains for WTI have been dashed for now as the price drops back from Wednesday’s highs.
A continued recovery above $70 would be necessary to revive the bullish view, while on the downside sellers will be waiting to see if the price can move back below $65 to open the way to a bigger decline.
Source:ProRealTime
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Gasoline and crude uptrend remain despite Biden calls for OPEC to help quell inflation pressures
Inflation figures highlight importance of energy prices, but Biden’s calls for OPEC to help drive gasoline and crude prices lower look to have fallen on deaf ears.
Source: Bloomberg
US inflation hurts the dollar
The past 24 hours have seen a big focus on US inflation, with headline consumer price index (CPI) remaining at 5.4% while producer price index (PPI) rose to a 12-year high of 7.8%.
One of the main drivers of that rise in inflation comes from the energy prices. The PPI breakdown below highlights exactly that, with energy making up the highest driver of upside.
Source: IG
Similarly, the CPI provided another reminder of the role played by rising energy prices, with gasoline in particular an area of concern.
Source: IG
With rising energy prices comes two-fold concerns for US President Joe Biden. Higher inflation raises the risk of tighter monetary policy, with the Federal Reserve (Fed) likely to pay close attention to this raft of inflation data points.
Meanwhile, the rise in energy prices has seen a 50% rise for gasoline prices at the pump. That will undoutably drain political support for Biden and reduce economic growth capacity as elevated fuel costs reduce the spending power of the everyday consumer.
With that in mind, it should come as no surprise to see Joe Biden address rising energy prices just as Donald Trump did before him. Biden’s call for Organization of the Petroleum Exporting Countries (OPEC) to raise production in a bid to drive down prices appears to have fell on deaf ears for now. That may change down the line, yet OPEC already have plans to raise production by 400,000 barrels per day (bpd), a month.
Thus, unless Biden is willing to perform a U-turn on his bid to lessen the nations reliance on oil and gas production, there are questions over whether the price will reverse on its own.
Gasoline uptrend remains for now
Gasoline has been on a very consistent rise, with the price hitting a six-year high at the end of July. While we have seen a pullback over the course of the past fortnight, this brings us back into the 76.4% Fibonacci support level.
A break below the $2.06 support level takes us out of the uptrend, with a bullish outlook in play until that breakdown occurs.
Source: ProRealTime
Brent Crude outlook remains bullish despite recent volatility
Brent Crude has seen plenty of choppiness over the course of the past month, with price falling back into 76.4% Fibonacci support.
While the initial rally has faltered once again in early-August trade, we are finding support at that same Fibonacci support level this week. As such, the uptrend does still remain intact unless the price breaks below the $67.06 and $64.52 support zone.
Source: ProRealTime
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Indices still on course for further gains, with DAX breaking higher towards 16,000
Stock markets continue to make headway, joined by a newly-resurgent DAX.
Source: Bloomberg
FTSE 100
A close above 7218 continues to elude the FTSE 100, but we have seen almost no downside momentum in recent sessions, suggesting that buyers continue to have the upper hand for now.
Any initial target in a move lower is 7088, although this is only likely to be short-term weakness, unless we see the price drop below 7000.
Source: ProRealTime
DAX
The DAX has finally broken out above June and July resistance, opening the way to new record highs and a potential capture of the 16,000 level.
This is a good reminder of how uptrends work: they can go through periods of consolidation but ultimately find a reason to break higher.
After almost two weeks of straight gains some weakness would not be surprising, but overall the bullish view remains intact.
Source: ProRealTime
S&P 500
The S&P 500's upward drift continues with no sign of a reversal, as the price sets yet more new record highs.
After breaking higher in early August, it seems like further upside will continue to play out.
Source: ProRealTime
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Risk event of the week starting 16 August: short EUR/GBP
With the relative hawkishness for the Bank of England over the outlook for the eurozone, IGTV’s Jeremy Naylor caught up with Justin McQueen from Daily FX to discuss a short trade around EUR/GBP.
Reuters polls show frail Japan GDP and US tapering ready to go
There have been two polls undertaken by Reuters that show two very differing pictures from two major economies.
IGTV’s Jeremy Naylor discusses both, including a forecast of a weakening Japanese economy while there is the prospect of early tightening from the Federal Reserve.
Charting the Markets: 13 August
Stock markets continue to make headway, joined by a newly-resurgent DAX. On the FX-front we take a look at EUR/USD, GBP/USD and USD/AUD. Finally, we end off with commodities by looking at gold and Brent crude.
https://www.ig.com/uk/market-insight-articles/charting-the-markets--13-august-210813
This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to. -
Early Morning Call: Indices push continues; Disney's blowout earnings and soft commodities showing strength
The push for indices continues with more records on INDU, S&P, DAX and MCX. Disney reports blowout earnings with Disney+ subscribers doubling. And, soft commodities are showing strength with wheat at multi-month highs.
This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.
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For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.
Today’s coverage:
Indices: The push continues with more records on INDU S&P DAX MCX. Europe expected to open higher after gains in Asia
FX: GBP under pressure - EURGBP trade idea with Daily FX. USD little moved
Equities: DIS has blowout earnings stock recent high all session on IG. ABNB Q2 covid warning on outlook stock down
Commods: Softs showing strength on wild weather etc. Wheat multi-month high. Strong week for gold
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PSG TOKENS PRICE, CHART, AND ANALYSIS
- Lionel Messi receives a ‘large number’ of PSG Fan Tokens.
- Superstar’s arrival boosts Token value.
For more on this article click this link DailyFX
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Market data to trade on Friday: EUR/GBP; US crude
With recent euro weakness and sterling strength, the short trade on EUR/GBP has been profitable. Now with a break of support, IGTV’s Jeremy Naylor looks at the new price target.
Then, with a paradoxical policy from the Biden administration for the call for more oil on the market, the Baker Hughes rig count becomes more interesting.
This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.
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As Gates and Bezos move into mining, where now for the sector?
With the recent news of a new joint venture between Bluejay Mining and Kobold Minerals, a company backed by Microsoft founder Bill Gates and Amazon founder Jeff Bezos, what does it mean for Bluejay, but also for the sector?
IGTV’s Jeremy Naylor caught up with John Meyer from SP Angel.
Charting the Markets: 12 August
Indices are moving higher in early trading, continuing their strong run in the wake of US CPI yesterday, with the DAX and S&P 500 hitting new records in the past 24 hours.
FX markets have seen the dollar weaken, allowing EUR/USD and GBP/USD to rally, while hitting USD/JPY after recent strong gains.
Finally, gold is still climbing recovering $1750, while US crude has bounced from support, potentially forming a double bottom and putting a new move higher in play.
https://www.ig.com/uk/market-insight-articles/charting-the-markets--12-august-210812
This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to. -
Dollar weakness lifts EUR/USD and GBP/USD, while stifling USD/JPY rally
US CPI figures yesterday hit the dollar, with the euro and sterling both making some gains against the greenback. Inevitably, this has led to some weakness for USD/JPY.
Source: Bloomberg
EUR/USD rallies from March support
Euro bulls will be hoping that EUR/USD can repeat its March feat and bounce from $1.17 in a substantial fashion.
The price is holding that support level for now, although gains are limited. Nonetheless, it gives longs something to trade against, while shorts will wait to see if a reversal develops that takes the price back below $1.17. Further, gains target $1.88 and then $1.194.
Source: ProRealTime
GBP/USD bounces from $1.38
Dollar weakness in the wake of US consumer price index (CPI) figures yesterday has allowed GBP/USD to bounce from $1.38, providing hope that the downward move of August has run its course. $1.40 could now be in the sights of longs, which would help to restore a more bullish view.
Sellers will have to wait and see if the price reverses below $1.38, a development that might put $1.36 back into the frame as a downside target.
Source: ProRealTime
USD/JPY falters at July highs
Unsurprisingly, USD/JPY has weakened following inflation data yesterday, leaving the ¥110.60 area intact as resistance, as was the case in July.
Bulls will want to see a revival that clears this zone, in order to open the way to more upside, while sellers will be hoping for a reversal below ¥110.00, that confirms a more negative short-term view and targets ¥109.00.
Source: ProRealTime
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Gold and Brent crude on the rise, yet questions remain
Gold and Brent crude continue to gain ground after a torrid Monday session, but will we break resistance to bring a more confident wider outlook?
Source: Bloomberg
Gold continues to recover after decline into support
Gold has been on the rise over the course of the week, with price gaining ground after a sharp decline towards the late-March low of $1678.
Yesterday’s consumer price index (CPI) reading provided a helping hand to this move higher, with price closing its Monday gap to reach $1759 resistance. The wider trend highlights a potential bearish trend coming back into play before long. Thus, we would ultimately require a break through $1834 to negate the bearish price action seen over the past two months.
Until then, short-term upside looks likely but we should consider the potential for key resistance around $1759, $1776, and $1798.
Source: ProRealTime
Brent crude continues to gain ground from Fibonacci support
Brent crude has similarly been on the rise after a difficult Monday, with price having tumbled back into the 76.4% Fibonacci support level once again.
A rise up through $72.29 brings yet another bullish signal as it would point towards a likely recovery back towards the $76-77 region. Certainly, it makes sense to remain cautious given the recent trend of lower highs.
However, a break through that $72.29 level would bring greater confidence that we have bottomed out.
Source: ProRealTime
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FTSE 100, DAX and Dow ease back after yesterday’s bullish break
FTSE, DAX, and Dow pause after yesterday’s US CPI-led drive through resistance.
Source: Bloomberg
FTSE 100 easing back from key resistance
The FTSE 100 has started to ease back overnight following a rise into the 7218 resistance level yesterday. There is a chance we see price retrace from here as long as we remain below 7218.
As such, this resistance level provides us with a key hurdle to overcome, with the ability to break through that threshold likely to prove key in determining sentiment for the days ahead.
Should price fail to break through resistance, any downside would be viewed as a retracement of the rally from 7088. A bullish view is thus held until price falls back below that 7088 swing-low.
Source: ProRealTime
DAX pauses after hitting record high
The DAX has eased back after reaching a new high yesterday, with the index falling back into the previous high of 15816 as newfound support.
Perhaps more importantly, it is worthwhile keeping an eye out for whether we see price break below the latest swing-low of 15698. Should that occur, we would be looking at a more protracted move lower.
Until then, this current pullback likely represents a short-term pullback before we head higher once again.
Source: ProRealTime
Dow Jones surges into fresh highs after CPI reading
The Dow has reacted with optimism after yesterday’s CPI reading that saw some elements such as used car price growth fall back.
While inflation remains elevated, there were some signs that it may have reached a plateau. From a Dow perspective, this rally builds on the recent range breakout, with further upside expected.
As such, further upside looks likely before long, with a decline through 35030 required to negate the bullish outlook.
Source: ProRealTime
See opportunity on an index?
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57 minutes ago, Marcraffard said:
$NIO Q2 Earnings
ETP NIO 3x/-3x - 3LNI/3SNI by GraniteSharesUSD
➡️ Revenue $1.3bn (+127% YoY)
➡️ Gross Profit $244m (+403% YoY)
➡️ Gross Margin 18.6% (stable)
➡️ 21,896 cars delivered (+112% YoY)Q3 Guidance
➡️ 23,000-25,000 car deliveries
➡️ Revenue $1.38bn-$1.49bnHi @Marcraffard, thanks for the follow up on NIO Q2 earnings.
MongiIG
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Early Morning Call: Equity rally continues; gold bounces back and OPEC+ under fire
More record highs for INDU, SPX, DAX, MCX and ASX. UKX at 18-month high, CAC at 20-year high. Gold is up with the gold/silver ratio at highest level since November last year. And, president Biden asks for more oil to curb prices.
This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to.
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For more up to date news on how markets will open, the latest earnings and economic news, watch IGTV live in the platform at 07:30am UK.
Today’s coverage:
Indices: No change to the recent trend…more record highs for INDU SPX DAX MCX ASX. UKX 18mth high, CAC new 20yr high. Tech down again
Equities: Earnings from AV CINE TUI in Europe. DTEL upgrades FY EBITDA. After the US close this eve - ABNB & DIS
FX: USD weakens on US inflation data and $3.5tln of further funding from Biden. Watching GBP ahead of UK GDP
Commods: Gold up – Gold/Silver ratio 74.7, highest since November last year. Lumber breaks support briefly hitting 9mth lows
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IG Trading the Markets: our trading and investing podcast
Listen to the IG Trading the Markets podcast – covering topics such as current news, forex trading, commodity markets and stock trading and investment strategies.
Latest episode of the Trading the Markets podcast: https://www.ig.com/uk/trading-podcastsIs the UK entering a period of stagflation?
With some members of the Bank of England talking about higher inflation for longer than the economy can withstand, will rates have to rise and will that rise stifle what growth there is?
In this episode, IGTV’s Jeremy Naylor talks to Martin Essex, analyst at Daily FX. Together they look at the prospects for the UK economy and how to trade sterling against the dollar and the euro.
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Charting the Markets: 11 August
TheSteadyTrader.com's Serge Berger joins IGTV's Jeremy Naylor on charting today. He’s positioning himself long indices and, despite the massive amounts of stimulus being pumped into the US economy, is also long the US dollar.
https://www.ig.com/uk/market-insight-articles/charting-the-markets--11-august-210811
Market data to trade on Thursday: UK GDP; DIS & ABNB earnings
IGTV’s Jeremy Naylor looks at GBP/USD as Thursday brings quarterly growth numbers in the UK. There’s also Eurozone and US data to watch. Earnings include Tui (TUI), Disney (DIS) and Airbnb (ABNB).
This is here for you to catch up but if you have any ideas on markets or events you want us to relay to the TV team we’re more than happy to. -
The so-called ‘last mile’ for delivery companies is notoriously difficult to lever a profit and Deliveroo said as much today in its H1 numbers. IGTV’s Jeremy Naylor says ROO shares have still to trade above its IPO price of 390p.
https://www.ig.com/uk/market-insight-articles/will-deliveroo-ever-make-a-profit--210811
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Dollar strength continues to weaken EUR/USD, GBP/USD and AUD/USD
EUR/USD, GBP/USD and AUD/USD head lower, with the dollar looking to continue its ascent.
Source: Bloomberg
EUR/USD drops back into key support
EUR/USD has continued to head lower following the drop into and below $1.1752 support on Monday. That breakdown did signal a likely move back into $1.1704 support.
Now, the key question is whether we see that $1.1704 level break, with such a move bringing an increased expectation of further downside from here. As such, with the pair at a key crossroads, whether or not we break this level will be key in determining the outlook going forward.
Source: ProRealTime
GBP/USD breaks support to bring risk of further weakness
GBP/USD has slumped back below the $1.3843 support level overnight, bringing an end to the trend of higher lows that played out over the final week of July.
That break does provide us with expectations of further downside from here, with a rise through $1.3872 required to stabilise things from an intraday perspective.
Source: ProRealTime
AUD/USD rolling over with pair likely to break lower
AUD/USD looks at risk of a strong move lower, with the recent period of consolidation at risk of coming to an end given the break below trendline support.
The drop below $0.7329 support brings expectations of another slump for the pair, with yesterday’s rise bringing about a short-term pullback before it heads lower once again. A break below $0.7316 brings about another fresh signal of impending weakness as we look to finally exit the consolidation phase.
Source: ProRealTime
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Gold edges higher while oil bounce continues
Gold’s volatility has continued to subside, with the price edging up, while oil has managed to make further headway after bouncing from support.
Source: Bloomberg
Gold
Dip buyers continue to push gold slightly higher, but there is still much ground to be made up before it can be said that a more bullish view has emerged.
Further gains in the direction of $1760 would be welcome for longs, but a close above $1765 is still needed to firmly establish the bullish view. A renewed decline still targets $1685 support.
ProRealTime
WTI
The bounce from support at $65.46 continues, leaving the impression that a double-bottom has formed. Now the price targets trendline resistance from the July peak, suggesting a test of resistance nearer to $71.
ProRealTime
See opportunity on a commodity?
News and Trade Ideas (Indices)
in Indices and Macro Events
Posted
Indices on the back foot after recent gains
The new week has begun with losses, although this has only put a small dent in the gains made over the past month.
FTSE 100
After a month of gains the FTSE 100 is in retreat this morning, although only modestly, moving back from the highs seen at the end of last week and back from resistance around 18-month highs at 7218.
Whether this turns into anything serious remains to be seen, but a move back to the 50-day simple moving average (SMA) at 7092 may find support, or at 7037 where previous weakness in June was held for a time.
DAX
A surge to a new record high for the DAX last week, which briefly took the price above 16,000, has been followed up with a small drop in early trading.
Initial support could be found at 15,816, previous resistance, and then down towards the 50-day SMA at 15,639. A recovery of 16,000 hands the initiative back to the buyers.
S&P 500
Like the DAX, this index hit a new peak at the end of last week. A small dip so far this morning fails to put much of a dent in the bounce, but buyers may not want to press their luck too hard in the short-term.
Sellers however need to be careful too, a higher low and higher high in around a month reminds us that this rally is still strong, and weakness is likely to be short-lived, with 4392 and then the 50-day at 4339 potential support.