Articles
United States Baker Hughes US Oil Rig Count climbed from previous 289 to 295
108700 January 30, 2021 02:09 FXStreet Market News
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Pfizer CEO: high possibility future variant will elude vaccines
108699 January 30, 2021 02:05 Forexlive Latest News Market News
That is a worry…
The Pfizer CEO Bourla is on the wires saying:
- high possibility future variant will elude vaccines
He adds:
- Towards the end of Q2 there will be no worry about supplying our vaccine to those that we have promised to supply
That is not great news.
Stocks are sliding to new lows with each of the major indices now down over 2%:
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Baker Hughes oil rig count 295 vs. 291 estimate. Last week 289
108698 January 30, 2021 02:02 Forexlive Latest News Market News
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Bitcoin Weekly Forecast: Elon Musk endorses Bitcoin while the ECB says investors may “lose all their money”
108695 January 30, 2021 02:02 FXStreet Market News
- Tesla CEO, Elon Musk has finally tweeted about Bitcoin sending the digital asset 30% higher.
- Gabriel Makhlouf from the European Central Bank has stated that Bitcoin investors should be prepared to lose everything.
- Despite the warning, the flagship cryptocurrency has continued to rise to new daily highs.
In the past 24 hours, a lot has happened in the cryptocurrency market. First, the WallStreetBets Reddit group announced an upcoming pump on DogeCoin which rallied by more than 1,000%. Shortly after, Elon Musk changed his Twitter bio to #Bitcoin and followed up with the next tweet.
The cryptocurrency market in the past 24 hours
Since the massive pump of Dogecoin followed by Bitcoin’s rally the total market capitalization has increased by more than $100 billion, reaching $1.044 trillion again. Dogecoin was ranked 10th by market capitalization for a while, beating Binance Coin and Stellar.
Elon Musk hasn’t tweeted anything else after changing his bio to #Bitcoin, but Gabriel Makhlouf, governing council of the European Central Bank did make a public statement warning investors that they could lose everything, adding:
Personally, I’m not sure why people invest in those sorts of assets, but they see them as assets clearly. Our role is to make sure that consumers are protected.
Of course, this was received with a ton of criticism from most retail investors who are angry about the most recent events with the trading app Robinhood which stopped retail investors from further buying GameStop stocks.
Bitcoin price could go in either direction, says veteran trader Peter Brandt
In his most recent report about Bitcoin, Peter Brandt states that Bitcoin price could go into many directions. However, thanks to the recent pump from Elon Musk’s tweet, Bitcoin has broken out of several potential patterns on the daily chart.
BTC/USD daily chart
On the daily chart, The descending triangle pattern has broken bullish with a price target of $46,000. According to the In/Out of the Money Around Price (IOMAP) model, the next significant resistance area is located between $37,700 and $38,480 with 248,000 BTC in volume.
BTC IOMAP chart
There is a lot of support below $36,000. If the bulls fail to hold the range between $34,000 and $35,000, Bitcoin price can quickly fall towards $33,000 which is the next most significant support point according to the IOMAP.
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NZD/USD slips back below 0.7200 level as month-end flows dominate FX markets
108694 January 30, 2021 01:35 FXStreet Market News
- Month-end flows are dominant in FX markets this Friday and NZD is an outperformer.
- NZD may also be feeling tailwinds from bank calls earlier in the week for a less dovish RBNZ going forward.
NZD/USD has slipped back to trade just below the 0.7200 level in recent trade, having hit highs of the day above 0.7220 prior to the US cash open. A further deterioration in the market’s broader appetite for risk (US stocks have been tanking anyway) is likely to blame for the recent downside in risk-sensitive NZD, though the pair still trades higher by about 0.3% on the day and is up on the week despite the broadly stronger US dollar. Month-end flows seem to be distorting the price action on the final trading day of the week.
Driving the day
FX markets are somewhat mixed/choppy on Friday given that it is the final trading day of the month and the final opportunity for institutions to balance their books ahead of the beginning of February. In G10 FX, that has meant selling in JPY (the worst performer), as well as in AUD, CHF and USD. Indeed, FX safe havens are underperforming despite the broader market tone being much more risk-off (US and European stock markets have been hit pretty hard, anyway).
NZD is one of the outperformers alongside NOK and CAD. No specific news can be pinpointed as being specifically behind why the kiwi is an outperformer on Friday or, indeed, why the currency has performed well on the week (NZD/USD is the second-best performing of the G10/USD majors this week, up about 0.2% and only lagging GBP/USD).
Banks betting on less dovish RBNZ going forward
However, as a reminder, a number of antipodean banks have been arriving at the conclusion that the RBNZ will not ease monetary policy any further in 2021; ANZ commented earlier in the week that “market confidence that the RBNZ is at, or close to, the trough in the monetary policy cycle remains a key driver of the NZD and dips are a buying opportunity”.
Meanwhile, Capital Economics went a step further to call for the RBNZ to hike as soon as 2022. They give three reasons as to why they do not expect any more stimulus from the RBNZ;
1) “The recovery in output occurred much faster than we had anticipated as GDP returned to pre-virus levels in Q3. And while the RBNZ is forecasting a renewed decline in output in the first half of this year, recent data suggest GDP has continued rising.”
2) “Most measures of underlying inflation surged in Q4. All of them are now close the RBNZ’s target mid-point.”
3) “Third, the housing market in New Zealand is running red hot. House prices are up nearly 20% from a year ago and show little sign of coming back down to earth. The surge in house prices prompted the Minister of Finance to write to RBNZ Governor Adrian Orr suggesting that house prices be added to the Bank’s monetary policy mandate. While the Bank rebuked that suggestion, we doubt Orr would be keen to exacerbate these political tensions by cutting interest rates further.”
CapEco’s forecast of a rapid recovery in output means that “we expect the unemployment rate to decline to around 4.5% by the end of 2022, consistent with employment being above its maximum sustainable level”. “Taken together with our forecast that underlying inflation will remain close to the Bank’s target mid-point”, they continue, “we think the Bank will turn its focus to policy tightening before long.”
CapEco suspects the bank will end QE purchases around the middle of this year and have penciled in three rate hike to 1.0% by the middle of 2023, making the RBNZ the first central bank in the developed world to lift rates following the Covid-19 outbreak.
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WTI still rangebound between $52.00-low-$53.00s amid ongoing market indecision
108693 January 30, 2021 01:12 FXStreet Market News
- Crude oil markets have largely stuck to this week’s ranges on Friday.
- WTI has swung between the $52.00 and just above the $53.00 level.
Crude oil market indecision has continued on the final trading day of the week; front-month WTI futures have very much stuck to the week’s prior established range of between the $52.00 and low-$53.00s. Indeed, this is a range that has persisted for most of the last three weeks.
At present, WTI trades close to the $52.50 mark, relatively flat on the day, with crude oil markets holding up despite downside in global equity markets, as jitters to do with the recent rise in speculative stock market retail trader activity leaves energy markets largely untouched (for now).
Driving the session
Indeed, it seems likely that while equity market traders fret about the crazy price action being seen in the likes of GameStop and other small-cap popular hedge fund shorted stock prices, energy markets are deriving some support from recent positive news regarding vaccinations; Novavax and Johnson & Johnson both released positive results for their final stage clinical trials. That means two more viable vaccine candidates to further accelerate the global vaccination effort, which, in fairness, has faced some setbacks in recent weeks amid production issues being reported by Pfizer, AstraZeneca and Moderna (affecting the European Union particularly badly).
Balancing act
Rangebound market conditions over the past three weeks are perhaps unsurprising given recent negative developments that have taken the wind out of the sales of the bullish narrative that had launched WTI prices nearly 50% higher in since the start of Q4 2020 from the mid-$30s to current levels above $50.
As a recap, the major factors boosting crude oil markets at the end of 2020 were; 1) positive vaccine news (providing a massive boost to the prospect for a demand recovery in 2021), 2) victory in the US Presidential election for Joe Biden (meaning a likely return to “normality” in terms of global trade, which is beneficial to global growth, and the likelihood of tougher regulations on US crude oil production) and 3) continued OPEC+ output cut flexibility, coupled with voluntary Saudi Arabian output cuts.
Whilst this bullish narrative has not sustained material damaged, it has faced hurdles; a global acceleration in the spread of the virus in wake of Christmas celebrations, the spread of new, more vaccine-resistant virus strains, vaccine production delays and new international travel restrictions have resulted in the World Bank, IMF and government downgrading global growth expectations and has delivered a blow to near-term crude oil demand prospects. Perhaps the only thing holding crude oil markets above the $50 mark is the 1M barrels per day in additional voluntary output cuts announced by the Saudi Arabians to last until April, which is keeping the market sufficiently tight.
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New York Gov. Cuomo: Post-holiday decline in Covid cases continues. Limited reopening of indoor dining announced
108691 January 30, 2021 01:02 Forexlive Latest News Market News
Covid statistics from New York
- total new cases 12,579
- total deaths 151
- cases rise at 0.9% vs. 7 day average of 1.0%
- hospitalizations drop to 8357
- positivity rate is 4.65% which is the lowest since December 11
- Gov. Cuomo says reduction in postholiday search continues
- Cuomo also announced a limited reopening of indoor dining at 25% on February 14
The high in cases peaked around 20K while the recent rise in deaths reached around 264 at its peak in January. That number was near 1000 at the start of the pandemic in April.
Colombia National Jobless Rate above forecasts (13.3%) in December: Actual (13.4%)
108690 January 30, 2021 01:02 FXStreet Market News
Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer.
Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any doubts.
Opinions expressed at FXStreet are those of the individual authors and do not necessarily represent the opinion of FXStreet or its management. FXStreet has not verified the accuracy or basis-in-fact of any claim or statement made by any independent author: errors and Omissions may occur.Any opinions, news, research, analyses, prices or other information contained on this website, by FXStreet, its employees, partners or contributors, is provided as general market commentary and does not constitute investment advice. FXStreet will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.
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Fed to maintain ultra-loose policy stance throughout this year – Capital Economics
108689 January 30, 2021 01:02 FXStreet Market News
Capital Economics analysts note that the US economic outlook continues to brighten with the rapidly accelerating vaccine rollout but don’t see the Fed abandoning its “current ultra-loose policy stance throughout this year.”
Key quotes
“Admittedly, we learned this week that GDP growth slowed to 4.0% annualised in the fourth quarter, as pandemic-related restrictions on activity and the fading of earlier fiscal support drove a sharp slowdown in consumption growth. Despite acknowledging that near-term virus-induced weakness, however, the Fed’s policy statement on Wednesday signalled greater confidence in the outlook further ahead.”
“At the same time, although disposable incomes fell by 9.5% annualised in the fourth quarter, December’s $900bn fiscal package will result in a renewed surge in the first quarter, which will be even stronger if Congress passes yet more stimulus over the coming weeks. Together, we expect the boost from vaccines and fiscal policy to help drive a marked acceleration in GDP growth to an above-consensus 6.5% this year.”
“But even that may not be enough for the Fed to start bringing forward its plans to tighten monetary policy. Powell’s emphasis on the continued shortfall in employment, and his argument that any significant rebound in inflation this year was most likely to be transitory, suggests the Fed is still firmly focused on providing maximum support to the economy.”
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Pres. Biden: Cost of inaction on stimulus is high and growing every day
108688 January 30, 2021 00:56 Forexlive Latest News Market News
Pres. Biden speaking
Pres. Biden is currently speaking and says:
- Cost of inaction on stimulus is high, growing every day
- Return on investments in the economy have never been higher
- Notion is must act now on stimulus, no time for delay
- Stimulus won’t be drag on economy, will help it grow
Comments are in line with his agenda.
US: NY Fed’s GDP Nowcast stands at 6.5% for Q1 after this week’s data
108687 January 30, 2021 00:51 FXStreet Market News
The US economy is expected to grow by 6.5% in the first quarter of 2021, the Federal Reserve Bank of New York’s latest Nowcasting Report showed on Friday.
Additional takeaways
“The advance estimate from the Commerce Department of real GDP growth for 2020:Q4, released on January 28, was 4.0%. The latest New York Fed Staff Nowcast for 2020:Q4 was 2.6%.”
“News from this week’s data releases decreased the nowcast for 2021:Q1 by 0.1 percentage point.”
“A negative surprise from personal consumption data was partially offset by a positive impact in manufacturers’ inventories data.”
Market reaction
The US Dollar Index showed no reaction to this report and was last seen posting small daily gains at 90.52.
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AUD/USD erases recovery gains after finding resistance near 0.7700
108686 January 30, 2021 00:49 FXStreet Market News
- AUD/USD lost its traction after rising in early American session.
- US Dollar Index turned north after Wall Street opened lower.
- AUD/USD remains on track to post weekly losses.
The AUD/USD pair spent the first half of the day trading in the negative territory near 0.7650 but gained traction in the early American session with the USD losing its strength. However, the risk-averse market environment didn’t allow the pair to extend its rebound and AUD/USD was last seen losing 0.22% on the day at 0.7662. On a weekly basis, AUD/USD remains on track to close in the negative territory.
The initial market reaction to US data caused the US Dollar Index (DXY) to slide to a daily low of 90.36. However, the risk-averse market environment, as reflected by sharp declines witnessed in Wall Street’s main indexes, helped the DXY stage a rebound. As of writing, the index was posting small daily gains at 90.53 and the S&P 500 was plunging 1.37%.
Earlier in the day, the US Bureau of Economic Analysis reported that Personal Income in December increased by 0.6% and Personal Spending fell by 0.2%, which was better than the market expectation for a decrease of 0.4%. Additionally, the Core Personal Consumption Expenditures (PCE) Price Index rose to 1.5% on a yearly basis in December and came in higher than analysts’ estimate of 1.3%.
AUD/USD technical outlook
UOB Group analysts think that AUD/USD is likely to remain under pressure in the next 1-3 weeks. “Risk has shifted quickly to the downside and AUD is likely trade with a downward bias towards 0.7560,” analysts noted. “On the upside, a break of 0.7730 would indicate the downside risk has dissipated. On a shorter-term note, 0.7700 is already a strong level.”