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🌈In the 12 years since its establishment,🎯 FSW has helped thousands of investors realize wealth asset appreciation

✅It is our mission to serve users professionally and attentively and achieve win-win results✅

07/11/2024

We finally get a bit of a breather from the US election. Although soon enough we will get an onslaught of updates regarding cabinet picks for the latest Trump administration, and what it means for investors and foreign relations (friends and foes). But for now we can shift out attention to today’s BOE and FOMC meetings, making it an ideal time to catch up on GBP/USD.
The Fed is expected to cut by 25bp today to 4.5%-4.75%, with Fed fund futures implying a 97.5% chance. Although Trump’s election feat has seen odds of a December cut drop to 67.2% from 80% just a few days ago. And with his policies deemed the more inflationary, odds of cuts next year are far from certain. There is therefore a real risk that the Fed will not deliver much of a dovish undertone which could further support the USD, or at least cap its potential for a decent retracement.

The BOE might cut by 25bp today, but confidence of it has waned since the release of the UK budget. And even if they do cut today, another in December seems unlikely.

So we may be in for a bit of a deadlock for interest rates with just 25bp of cuts expected for each bank for the rest of the year. Unless of course the Fed decide that it makes more sense to deliver a dovish cut, and squeeze 50bp of easing in before Trump takes to office in January. And that could be bullish for GBP/USD.

06/11/2024

Markets react to Trump win: US futures, dollar surge, commodities drop

It has just been confirmed that Donald Trump has won majority of the votes to become the next President of the USA and the Republicans have also won the senate. The big win has given “an unprecedented and powerful mandate” declared Trump, as his party won swing states of North Carolina, Wisconsin, Pennsylvania and Georgia. The Republicans could also win the house, but this is not confirmed yet. With 5 results to go, Trump has already won 51% of the vote with Harris only securing around 47.4% - a massive victory for Trump and a massive response from the markets!

05/11/2024

The US dollar and yields have enjoyed a strong rally over the past five weeks, thanks to hotter US data, Fed members pushing back on rate cuts, and Trump leading in many polls. But with the US election on our doorstep and the potential for a delayed result, could this tie the Fed’s hands at this week’s meeting?

With Fed fund futures implying a 99.7% chance of a 25bp cut this week, it would come as an almighty shock to markets if they didn’t. And unlike other central banks such as the BOJ or SNB, the Fed tend not to surprise much these days. Instead they slowly shape their message to guide markets where they want, with various levels of success and of course failure. This means the Fed are very likely to cut this week regardless of the fact it lands on election week. However…

04/11/2024

USD/CAD short setup

Depending on entry level, the price would need to break several nearby levels to make the trade stack up from a risk-reward perspective, including the uptrend from October 15 and horizontal support at 1.3869. If they were to fold, 1.3815 is one potential target with 1.3748 and 1.3700 the next after that. A stop above Friday's high would provide protection against reversal.

Bolstering the case for potential downside, RSI (14) has broken the uptrend it was sitting in after sitting in overbought territory for more than a week, hinting bullish momentum may be starting to turn. While the signal is yet to be confirmed by MACD, that too is looking like it may soon rollover as it moves closer to the signal line.

03/11/2024

USD/JPY continues to be driven by the US interest rate outlook, putting focus on the US Presidential election and the Federal Reserve FOMC policy decision this week. Expect volatility around both events, raising the risk of Bank of Japan intervention.

Fiscal policy in focus
While USD/JPY is mainly driven by the US interest rate outlook, recent movements suggest it's the belly of the US Treasury curve (2-10 years) that's been particularly influential over the past month. The correlation with 10-year Treasury yields sits at 0.94, slightly stronger than shorter-term yields or Fed funds futures.

Given the short end of the Treasury curve largely reflects Fed rate expectations, the stronger correlation with longer-dated yields hints that speculation over the US election outcome could be more relevant to USD/JPY near term.

01/11/2024

EUR/USD rebound stalls at familiar level
Another factor behind the rebound was short-term oversold conditions after a significant bearish reversal in EUR/USD that began in early October, seeing the price bounce after contemplating a test of long-running uptrend support.

Dips below 1.0778 were bought before a bullish hammer candle on Tuesday provided the signal traders would have been looking for to initiate long trades, fuelling the rebound over the next two sessions.

The price now finds itself testing downtrend support dating back to July 2023 after popping above the 200-day moving average, providing a decent level for traders to build setups around.

31/10/2024

📖Overview
US economic growth sits at levels consistent with higher inflation and lower unemployment, forcing markets to pare Fed rate cut bets. Higher US interest rates are fuelling US dollar upside, forcing the likes of AUD/USD and NZD/USD lower.

❌US economy defying doomers
US economic exceptionalism is back. It feels like every day we see another upside surprise in US data, making a mockery of supposed concerns that monetary policy settings from the Federal Reserve are too restrictive. The US economy is growing well above levels thought to be required to keep unemployment and inflation stable, seeing Citi’s economic surprise index lift to the highest level since April. Even with the bar to impress continuing to rise, the proportion of data topping forecasts is still rising, not falling. It’s remarkable.

30/10/2024

The two-day recovery means the pressure has eased somewhat on the EUR/USD exchange rate. But the technical EUR/USD forecast still remains moderately bearish while the pair trends below its 200-day moving average and resistance at 1.0870 to 1.0900.

If the downward pressure resumes, then the first level of support to watch is Monday’s high at 1.0826 with the next potential downside target at 1.0775-1.0780, where the 1-year-old bullish trend line comes into play. A break below that could send the pair towards 1.0700 or lower if US data continues to outpace expectations, or Trump is elected as the next US President.

29/10/2024

With just one week to go until the US election, we take a statistical look at how key markets have performed in the days surrounding this major event

The data may appear daunting at first, but there are a couple of distinct patterns which are worth noting.

● European and US stocks tend to rise the day prior, and of the US election, yet hand back gains the two days after
● The Japanese yen (JPY) tends to attract safe-haven flows two days prior to the election (T-2) and the two days after (T+1 and T+2)
● Volatility also increases at T+1, although keep in mind that this captures the overnight volatility form the US (during the Asian session) as the election results pour in
● Data covers the past eight elections from 1992, with the exception of US index and VIX futures which are from the 2000 election

'Please note that this data is not predictive, as it merely looks at the averages of historical performances of the respective markets. However, it can be used to complement your own analysis'

28/10/2024

Metals (gold, silver, copper) futures - COT report:
Another week, another record high for gold. And if gold rises, so does silver. Both sets of traders increased their net-long exposure to gold futures for a second week, although they also increased gross shorts slightly to suggest a certain level of nervousness at frothy heights.

They showed a more traditional approach with silver futures by increasing net-long exposure by adding to longs and reducing shorts. Net-long exposure to silver futures rose to its most bullish level since March 2020 among large speculators, and March 2022 among managed funds.

Copper was the odd one of the three metals, as net-long exposure retraced lower for a second week and process were lower for a fourth. So much for China’s stimulus adding to bullish bets.

27/10/2024

Trimmed mean is the inflation figure to watch, if you had to watch just one. Although I doubt it will do much if a favour for the RBA, where rate cuts are concerned. While its 0.8% q/q print was its second lowest in three years, it was only marginally beneath its 0.88% post-pandemic average. The four years prior to the pandemic averaged 0.41% q/q, and the annual rate of trimmed mean is also a hefty 3.9% y/y. And as the name suggests, trimmed mean has had volatility squeezed out of it, so rarely deviates too far from the prior read. Perhaps the bigger risk here is if we see trimmed mean quarterly rise 0.8% or higher and spark calls for another hike.

Still, traders will react if headline CPI comes in soft, I just doubt it will make a material impact on the RBA who are still mulling over whether a cut or hike is more likely, if or when it happens at all

25/10/2024

The rally on US yields took a breather on Thursday, prompting the USD index to trade lower for tis second day over the past 10. Moreover, it was the dollar’s worst day during its entire rally from the September low and closed the day with a bearish outside, engulfing candle. This allowed EUR/USD to finally post a solid day’s gain against is bearish trend and rally from the August, low, and helped GBP/USD recoup Wednesday’s losses and rise in line with yesterday’s bullish bias, despite soft PMI reports from both the UK and the Euro Area

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http://fxshw.com/

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