CURRENCIES:

Trending Analysis: Focus on British Pound’s market sentiment and outlook, covering GBP/USD, GBP/JPY, EUR/GBP.

Dollar’s Rally Triggered by Rising U.S. Treasury Yields: The uptick follows unexpectedly high Producer Price Index (PPI) figures for February, closely following a significant Consumer Price Index (CPI) report.

Strong Labor Market Reinforces U.S. Dollar: The consistent low levels of jobless claims underscore the economy’s strength, enhancing the dollar’s attractiveness.

Federal Reserve’s Policy and Economic Outlook: Despite prior hints at policy tightening, challenges in achieving disinflation amidst economic resilience might limit or delay rate cuts initially expected to begin in June.

Upcoming FOMC Meeting Eyed for Clues: Next week’s Federal Reserve meeting is anticipated to provide crucial insights into the monetary policy direction and interest rate projections, potentially affecting market expectations for 2024.

Inflation Risks May Alter Rate Cut Expectations: With inflation concerns re-emerging, the Fed might signal a reduced likelihood of rate cuts, potentially sustaining high bond yields and supporting the dollar’s strength.

STOCK MARKET:

Corporate Earnings in Focus: Investors are keen on corporate performance insights before further inflation data is released.

S&P 500 and Nasdaq 100 See Uplift: Futures contracts for these indices up by about 0.3% and 0.4% respectively, indicating positive market momentum.

Tech Giants Show Pre-Market Strength: Companies like Netflix Inc. and Meta Platforms Inc. gain from potential regulatory changes affecting TikTok. Adobe Inc. also rises ahead of its earnings report, while Tesla Inc. drops due to pessimistic sales forecasts.

Treasuries and Dollar Stability: The 10-year Treasury yield increases by 12 basis points this week; the dollar index remains relatively unchanged.

Upcoming U.S. Producer-Price Data: This report is highly anticipated as the last major inflation indicator before the Federal Reserve’s next policy meeting, where rates are expected to stay constant.

Market Optimism Persists: Despite scaled-back rate cut expectations, stock enthusiasm continues, with the S&P 500 achieving new highs.

JPMorgan’s Bullish Market Outlook: Grace Peters from JPMorgan Private Bank updates price targets for major stock indices, forecasting robust corporate profits.

European Stocks Hit Record Highs: The Stoxx 600 index climbs, with consumer sectors leading the way, especially after Allegro.eu SA’s earnings surpass expectations.

Energy and Renewable Stocks on the Rise: Oil companies and Encavis AG see gains, while certain European companies report positive earnings, contributing to market dynamics.

ECB Rate Cut Recommendations: ECB’s Yannis Stournaras suggests multiple rate cuts within the year, aligning with market expectations for monetary easing in Europe.

Chinese Market Sentiment: Despite government support measures, investor confidence remains cautious, though some sectors like copper mining benefit from commodity price movements.

Global Commodity Trends: Crude oil continues its upward trend, iron ore faces downward pressure, and gold remains stable, reflecting diverse investment landscapes.

Start your CFD Shares Trading journey with VT Markets now!

Dear Client,

Please note that the dividends of the following products will be adjusted accordingly. Index dividends will be executed separately through a balance statement directly to your trading account, and the comment will be in the following format “Div & Product Name & Net Volume ”.

Please refer to the table below for more details:

The above data is for reference only, please refer to the MT4/MT5 software for specific data.

If you’d like more information, please don’t hesitate to contact [email protected].

Trading has become increasingly popular among non-professionals, offering both enticing opportunities and daunting risks. While the potential for profit and portfolio diversification attracts many, the reality of market uncertainty and emotional challenges cannot be ignored. 

To navigate this landscape successfully, adopting a professional mindset is crucial. This means approaching trading with discipline, patience, and a commitment to continuous learning. 

In this guide, we will explore essential rules to help non-professional traders trade like seasoned pros, enhancing their chances of success in the dynamic world of financial markets. 

Rule 1: Master the fundamentals 

Before delving into trading, mastering the basics is crucial. Just as learning a language is essential for communication, understanding trading terminology and main concepts lays the groundwork for informed decisions in the financial markets. Without this foundation, confusion and costly mistakes are more likely. 

For beginners, resources provided by VT Markets offer an excellent starting point. From comprehensive guides to advanced tutorials, VT Markets equips aspiring traders with the knowledge they need to kickstart their trading journey. 

Rule 2: Set clear goals and risk tolerance 

Before entering the trading arena, establish clear financial goals, such as building wealth or saving for retirement. A defined destination focuses efforts and maintains motivation. 

Equally crucial is understanding your risk tolerance—know how much you are willing to risk per trade. This knowledge prevents overextension and aids emotional management in volatile markets. 

Armed with your goals and risk tolerance, it’s time to devise a well-thought-out trading plan. This plan serves as your roadmap, outlining strategies, entry and exit points, and risk management techniques. 

Rule 3: Start small and diversify 

Starting your trading venture with a small capital minimises potential losses and provides a low-pressure environment for gaining experience. It’s a prudent approach to test strategies and refine skills without exposing yourself to significant financial harm. 

Diversification is key to managing risk effectively. Spread your investments across different assets, industries, and markets to mitigate the impact of any single loss. This strategy enhances stability and safeguards your portfolio against market volatility. 

Rule 4: Stay informed 

Staying informed is paramount in the world of trading. Regularly monitoring financial news and market trends allows you to anticipate potential market movements and adjust your trading strategy accordingly. Economic indicators provide valuable insights into the health of various sectors and can help guide your investment decisions. 

For reliable market information and analysis, turn to trusted sources like VT Markets. Our daily market analysis and economic calendar offer valuable insights, expert commentary, and actionable trading ideas. 

Rule 5: Rely on technical and fundamental analysis 

Technical analysis studies past market data for patterns and trends. Fundamental analysis evaluates asset value through economic indicators and company financials. 

While technical and fundamental analysis each have their strengths, using them in combination can provide a more comprehensive view of the market. By integrating both methods into their trading strategy, traders can make more informed decisions and increase their chances of success in the market. 

Rule 6: Practice risk management 

In trading, managing risk is vital. Setting stop-loss orders and controlling position sizes are key tactics to safeguard capital and limit losses. 

Stop-loss orders, which determine exit points for losing trades, help maintain disciplined decision-making and prevent emotional reactions, especially in turbulent markets. 

Managing position sizes means allocating capital wisely, considering risk tolerance and market conditions. This practice ensures diversification and protects the overall portfolio. 

Professional traders also utilise strategies like diversification, hedging, and cautious leverage to further manage risk effectively. 

Rule 7: Be patient 

In trading, impulsive decisions driven by fear or greed often result in losses. Patience allows traders to stay disciplined, avoid chasing short-term gains, and stick to their trading plan even when the market seems chaotic. 

Many successful traders credit their achievements to patient decision-making. From legendary investors like Warren Buffett to seasoned day traders, the ability to wait for high-probability trades is a common trait among top performers. 

Rule 8: Never stop learning 

Traders who are committed to learning are better equipped to adapt to changing market conditions and seize emerging opportunities. By staying curious and open to new ideas, you can continuously refine your skills and enhance your trading performance. 

For those eager to expand their knowledge, VT Markets offers a wealth of educational resources. VT Markets provides valuable insights and practical tips to help traders at every level improve their skills and achieve their goals. 

Rule 9: Control emotions 

Fear, greed, and excitement can cloud judgment and lead to poor decision-making. Traders who let emotions dictate their actions are more likely to succumb to market fluctuations and suffer losses. 

To keep emotions in check, it’s essential to develop strategies for maintaining emotional control. Taking breaks during stressful periods, practicing mindfulness techniques, and sticking to a predefined trading plan can help traders stay focused and disciplined, even in challenging market conditions. 

Rule 10: Evaluate and adapt 

Self-assessment enables traders to recognise patterns in their trading behaviour and performance. By analysing both successful and unsuccessful trades, traders gain valuable insights into what works and what doesn’t. This knowledge forms the basis for refining strategies and adapting to evolving market conditions. 

Successful traders understand the importance of flexibility and adaptation. They are willing to adjust their strategies based on lessons learned, incorporating new insights and techniques to enhance their approach. By embracing change and continually evolving, traders position themselves for long-term success in investing. 

In conclusion, mastering the art of trading like a pro involves adhering to key principles such as understanding fundamentals, practicing risk management, controlling emotions, and continuous self-assessment. At the core of these principles lies the essence of discipline, a commitment to ongoing learning, and the ability to adapt. 

By embracing these guidelines, you can confidently navigate the dynamic financial markets, cultivating not only profitable trades but also effective risk management strategies for sustained, long-term success in your trading journey. 

The allure of gold has a hold on many traders and investors, especially amid the uncertainties of the financial realm. However, navigating its market dynamics demands keen insight. This is where technical indicators are key to successful trades. By scrutinising historical patterns, these tools empower traders to make judicious choices. 

In this article, we are here to make gold trading more predictable. We’ll explore why technical indicators matter and how they decode gold market trends. Ready to unravel the mysteries of gold trading? Let’s get started. 

The power of technical indicators in gold trading 

When it comes to trading gold, technical indicators are essential tools that offer invaluable insights into market trends and conditions. By analysing historical data, these indicators provide clarity, spotting trends, and patterns that help traders make informed decisions. 

They aid in timing entry and exit points, minimising risks while maximising profits. Technical indicators also complement fundamental analysis, offering a holistic view of the market dynamics. 

Moving averages, relative strength index (RSI), Bollinger Bands, and moving average convergence divergence (MACD) are among the main indicators traders consider, each offering unique perspectives and strategies for successful gold trading. Incorporating these indicators into your trading strategy can enhance your chances of success in the gold market. 

Using moving averages in gold trading 

Moving averages are simple yet powerful tools that can help gold traders spot trends and make better trading decisions. Here’s a practical guide to using moving averages effectively: 

• Trend identification: Moving averages smooth out price fluctuations, making it easier to identify trends. When the price is consistently above the moving average, it suggests an uptrend, while a price below the moving average indicates a downtrend. 
• Crossover signals: Pay attention to moving average crossovers as potential trading signals. A bullish crossover occurs when a shorter-term moving average crosses above a longer-term moving average, signalling a possible uptrend. Conversely, a bearish crossover suggests a potential downtrend. 
• Support and resistance: Moving averages can also act as dynamic support and resistance levels. During an uptrend, the moving average may provide support, while in a downtrend, it may act as resistance. Traders can use these levels to identify entry and exit points for their trades. 

Using RSI in gold trading 

The relative strength index is a handy tool for gold traders to gauge the momentum of price movements. Here’s how to use RSI effectively in your gold trading: 

• Identifying overbought and oversold conditions: RSI measures the speed and change of price movements on a scale of 0 to 100. Readings above 70 indicate overbought conditions, suggesting that the asset may be due for a price correction. Conversely, readings below 30 suggest oversold conditions, indicating a potential buying opportunity. 
• Spotting divergence: RSI divergence occurs when the price movement disagrees with the RSI indicator. Bullish divergence occurs when the price makes lower lows while RSI forms higher lows, suggesting a potential bullish reversal. On the other hand, bearish divergence occurs when the price makes higher highs while RSI forms lower highs, signalling a potential bearish reversal. 
• Confirmation of trends: RSI can also confirm the strength of a trend. In a strong uptrend, RSI tends to stay above 50, while in a downtrend, it tends to stay below 50. Traders can use this information to confirm the direction of the trend and make more informed trading decisions. 

Using Bollinger Bands in gold trading 

Bollinger Bands are a popular tool among gold traders for assessing volatility and potential price reversals. Here’s a practical guide on how to use Bollinger Bands effectively in gold trading: 

• Understanding Bollinger Bands: Bollinger Bands consist of three lines: an upper band, a lower band, and a middle band (typically a 20-period simple moving average). These bands expand and contract based on price volatility, providing traders with valuable insights into market conditions. 
• Identifying volatility: When the bands contract, it suggests low volatility, while widening bands indicate increasing volatility. Traders can use this information to anticipate potential breakout or breakdown opportunities in the gold market. 
• Spotting overbought and oversold conditions: Prices touching or crossing the upper band may indicate overbought conditions, suggesting a potential reversal or pullback. Conversely, prices touching or crossing the lower band may indicate oversold conditions, signalling a potential buying opportunity. 
• Trading strategies with Bollinger Bands: Traders can use Bollinger Bands to develop various trading strategies, such as the Bollinger Squeeze and Bollinger Band width. The Bollinger Squeeze occurs when the bands contract tightly, indicating low volatility, followed by a potential breakout. The Bollinger Band width measures the width of the bands, providing insights into market volatility and potential trading opportunities. 

Using MACD in gold trading 

Moving average convergence divergence is a versatile tool that can provide valuable insights into momentum and trend direction in gold trading. Here’s how to use MACD effectively: 

• Understanding MACD components: MACD consists of three components: the MACD line, the signal line, and the histogram. The MACD line is calculated by subtracting the 26-period exponential moving average (EMA) from the 12-period EMA, while the signal line is a 9-period EMA of the MACD line. The histogram represents the difference between the MACD line and the signal line. 
• Interpreting MACD crossovers: Bullish crossovers occur when the MACD line crosses above the signal line, signalling potential upward momentum. Conversely, bearish crossovers occur when the MACD line crosses below the signal line, indicating potential downward momentum. Traders can use these crossovers as entry or exit signals for their trades. 
• Using MACD histogram for momentum: The MACD histogram provides insights into the momentum of price movements. Positive histogram bars indicate bullish momentum, while negative bars indicate bearish momentum. Traders can look for divergences between the histogram and price movements to anticipate potential trend reversals. 

In conclusion, technical indicators are crucial for successful gold trading, providing insights into market trends and conditions. Investors are encouraged to experiment and refine their strategies, adapting them to individual preferences and risk tolerance. Keep exploring, keep learning, and stay adaptable to thrive in gold trading. 

Dear Client,

As part of our commitment to provide the most reliable service to our clients, there will be MT5 server, VT APP and Client Portal maintenance this weekend.

The MT4 software remains unaffected by this maintenance and will continue to facilitate transactions without interruption.

Maintenance Hours :
16th of March 2024 (Saturday) 00:00 – 24:00 (GMT+3)

Please note that the following aspects might be affected during the maintenance:

1. The password for your MT5 trading account is set to be reset, once you log into the MT5, you will be asked to reset the trading account password. Also, you can log into your client portal to reset the password.

2. The order “number” associated with your trading account will be renewed. Except for the order number, all other settings of the position will remain unchanged.

3. Please be advised that your MT5 Demo account is set to expire. Should you require continued access, kindly create a new MT5 demo account through the client portal.

4. Kindly be advised that the functionality of the Client Portal and VT APP will be temporarily unavailable during the maintenance period, thereby hindering normal login operations. It is strongly recommended to refrain from engaging in account service management activities throughout the maintenance period.

5. The price quote and trading management will be temporarily disabled during the maintenance. You will not be able to open new positions, close open positions, or make any adjustments to the trades.

6. Should you be using the MT5 PAMM service, it is imperative to be mindful of the following considerations:

6-1. Open positions will be automatically closed if the Master fails to close them before the update on March 16th. It is suggested that the Master closes the open positions in advance.

6-2. The history on the PAMM Portal will be reset and saved in the “Archive”. On the PAMM portal, Money Manager can turn on “Show archive” button to see the history records.

6-3. The High Water Mark (HWM) value will be reset. However, we will retain the latest HWM before the update. Therefore, any excessively generated Performance Fee (PMF) will be deducted and returned to the investors until the PMF is charged with the correct amount.

There might be a gap between the original price and the price after maintenance. The gaps between Pending Orders, Stop Loss and Take Profit will be filled at the market price once the maintenance is completed. It is advised to exercise diligence in monitoring position control.

Please refer to MT5 for the latest update on the completion and market opening time. Our services will be back online once the maintenance is completed.

Thank you for your patience and understanding about this important initiative.

If you’d like more information, please don’t hesitate to contact [email protected]

The Dow Jones Industrial Average ended its three-day winning streak with a decline on Thursday, driven by unexpectedly high U.S. inflation data that also saw Treasury yields climbing. The producer price index for February indicated a higher-than-anticipated rise in wholesale inflation, causing a stir in the stock and bond markets. Major technology stocks like Apple and Microsoft remained in favor, while Nvidia and electric vehicle startup Fisker faced setbacks. The inflation report, critical to the Federal Reserve’s upcoming policy decisions, influenced the bond and currency markets, setting a cautious tone ahead of the Fed’s next meeting. Investors and analysts are now recalibrating their expectations for interest rates and market direction, highlighting the ongoing challenges in predicting economic trends amidst fluctuating inflation rates.

Stock Market Updates

The Dow Jones Industrial Average experienced a downturn on Thursday, ending a three-day winning streak as unexpectedly high U.S. inflation data prompted a rise in Treasury yields, placing additional pressure on shares of Nvidia. The Dow dropped by 137.66 points, a 0.35% decrease, settling at 38,905.66. Similarly, the Nasdaq Composite and the S&P 500 saw declines, falling 0.3% and 0.29% to close at 16,128.53 and 5,150.48, respectively. This downturn came in the wake of the February producer price index (PPI) report, which indicated a 0.6% increase in wholesale inflation, exceeding economist predictions.

The rise in the producer price index, particularly with a 0.6% leap last month and a core PPI (excluding food and energy prices) increase of 0.3%, surpassed Dow Jones economists’ expectations. These economists had anticipated a more modest 0.3% gain for the headline PPI and a 0.2% increase for the core measure. Initially, the stock market showed resilience in response to the report but began to falter shortly after the trading day began, reflecting investors’ concerns about the implications of persistently high inflation on future Federal Reserve rate decisions and the potential impact on the stock market rally’s momentum.

The inflation report’s aftermath saw bond yields on the rise, with the benchmark 10-year Treasury yield climbing approximately 10 basis points to 4.29%. Nvidia’s shares were notably impacted, marking a decline for the fourth time in five sessions, with a pullback of over 3%. Market strategists and investors are now grappling with questions about the direction of yields and the market’s trajectory, with expectations of further downside if yields continue to ascend.

On the technology front, major stocks like Apple and Microsoft drew investor interest despite the overall market downturn. Robinhood’s shares surged by 5% following a report of a 16% increase in assets under custody compared to the previous month. In contrast, the electric vehicle sector witnessed Fisker’s shares plummeting nearly 52% amid reports of potential bankruptcy preparations, showcasing the varied investor responses across different sectors.

Currency Market Updates

Currency and commodity markets also reacted to the inflation and employment data, influencing expectations for the Federal Reserve’s upcoming policy meeting. The dollar strengthened against major currencies, and oil prices surged, adding to inflationary pressures. Investors and analysts are now closely watching the Federal Reserve’s next moves, with the upcoming policy meeting poised to provide further direction amidst ongoing economic uncertainties.

Picks of the Day Analysis

EUR/USD (4 Hours)

EUR/USD weakens amid strong US dollar and anticipated central bank easing

The EUR/USD pair exhibited increased weakness, reaching weekly lows below 1.0900, driven by a resurgence in the US Dollar’s strength amid positive US economic data and rising US yields. This development comes as both the US and European economies prepare for anticipated easing cycles by the Federal Reserve and the European Central Bank, potentially starting in June. Despite similar timelines for rate cuts, the differing economic fundamentals between the eurozone and the US, particularly the robust US economy and its tighter labor market, hint at a medium-term advantage for the Dollar. Consequently, EUR/USD faces the prospect of further corrections, possibly testing significant lows not seen since late 2023.

Chart EUR/USD by TradingView

On Thursday, the EUR/USD moved lower and reached the lower band of the Bollinger Bands. Currently, the price is moving just around the lower band, suggesting a potential higher movement, and may reach the middle band. Notably, the Relative Strength Index (RSI) maintains its position at 31, signaling a bearish outlook for this currency pair.

Resistance: 1.0917, 1.0984

Support: 1.0859, 1.0812

 Economic Data

CURRENCIES:

• ECB official advocates for two interest rate cuts before summer to support the economy.
• Yannis Stournaras, head of the Greek central bank, suggests the need for easing monetary policy ahead of the Federal Reserve, highlighting that 30% of previous tightening impacts have yet to affect the real economy.
• Economic stagnation in Europe since Q4 2024, with GDP growth near zero, contrasts with the US’s economic resilience.
• Stournaras proposes a total reduction of 50 basis points from the current benchmark interest rate, cautioning against overestimating the risk of a wage-price spiral.
• Immediate market reaction saw EUR/USD decline following Stournaras’ comments but quickly stabilized.
• The EUR/USD pair encounters resistance around the 1.0930/1.0940 zone, a level that has historically led to price declines.
• The week’s economic calendar is light, suggesting potential consolidation at current levels, with US PPI and retail sales data, and the University of Michigan consumer sentiment survey expected to offer limited market volatility.

STOCK MARKET:

• Investors await US inflation data for insights into the Federal Reserve’s interest rate decisions.
• European stocks (Stoxx 600) rose by 0.2%, with US futures also seeing an uptick.
• Treasury bonds remained stable, with a notable increase in the 10-year yield by about 12 basis points over the week.
• The US dollar index showed little change.

Market Anticipation:

• Focus is on upcoming US producer price data that could reinforce or counteract the week’s higher consumer inflation reports.
• Traders in Europe keen on European Central Bank (ECB) officials’ speeches, particularly after ECB Governing Council member Yannis Stournaras advocated for two rate cuts before summer.

Investor Sentiment:

• General market volatility appears subdued as participants digest inflation data and central bank communications.

Asian Markets Response:

• Chinese market sentiment remains cautious despite government promises of financial incentives for updating old equipment and goods.
• Shares of Asian copper miners rose following copper’s surge to an 11-month high, driven by potential production reductions in Chinese smelters.

Japanese Economy Watch:

• The Japanese yen weakens for the third consecutive day ahead of Rengo’s announcement on wage negotiations.
• Bank of Japan’s interest rate decision pending, influenced by initial outcomes of spring wage discussions.

Commodities Update:

• Oil prices remain high after a significant reduction in US crude inventories and another Ukrainian attack on a Russian refinery.
• Gold prices showed stability.

Start your CFD Shares Trading journey with VT Markets now!

Dear Client,

Please note that the dividends of the following products will be adjusted accordingly. Index dividends will be executed separately through a balance statement directly to your trading account, and the comment will be in the following format “Div & Product Name & Net Volume ”.

Please refer to the table below for more details:

The above data is for reference only, please refer to the MT4/MT5 software for specific data.

If you’d like more information, please don’t hesitate to contact [email protected].