Daily Market Analysis

Market Focus

U.S. stocks declined for a second day with losses steepening in the final 15 minutes of trading as investors weighed the rush to reopen the economy against inflationary pressure from a rise in commodity prices.

All three of the main U.S. equity benchmarks closed lower after mega-cap technology stocks including Amazon.com Inc., Microsoft Corp. and Alphabet Inc. erased earlier gains. Nine of the main 11 S&P 500 industry groups declined, with energy stocks leading losses as oil prices dropped amid a report that significant progress has been made to revive the U.S.-Iran nuclear deal. AT&T Inc. plunged the most in the benchmark gauge after the company said it plans to spin off its media operations. Walmart Inc. rallied the most in six weeks after boosting its profit outlook.

Stocks have been volatile after touching a record in early May as investors assessed economic growth prospects against a Covid-19 resurgence in countries including India. Minutes from the latest Federal Reserve meeting, due Wednesday, may offer clues on inflation pressure and hints of a timeline for tapering stimulus. Fed Vice Chair Richard Clarida said Monday that the weak U.S. jobs report showed the economy had not yet reached the threshold to warrant scaling back asset purchases. Inflation concerns intensified last week when the government reported the fastest increase in consumer prices since 2008 and commodities from iron ore to Brent crude rose to multiyear highs.

Main Pairs Movement:

A gauge of the greenback’s strength declined to near its lowest level in four months as risk sentiment was buoyed by comments from a Federal Reserve official that played down the risk of policy tightening. New Zealand’s dollar outperformed the Group-of-10 currencies.  

The kiwi was driven by corporate demand that lifted it past option-related offers near 72.25 U.S. cents, according to Asia-based FX traders. The Aussie and pound gained after buy stops were triggered, the traders said.

West Texas Intermediate crude extended declines after the BBC Persian news channel, citing Russian diplomat Mikhail Ulyanov, reported that a major announcement may be made on Wednesday regarding talks to broker an agreement between Iran and the U.S. and revive the 2015 nuclear deal. A return to the accord could allow for the removal of U.S. sanctions on Iran’s crude exports and bring more supply to the market.

Elsewhere, Bitcoin fell to the lowest since February after the People’s Bank of China reiterated that the digital tokens cannot be used as a form of payment. Coinbase Global Inc. fell after Monday’s drop below the reference price used in its April direct listing.

Technical Analysis:

EURUSD (4 hour Chart)

Euro fiber soar up to two-month high at 1.2225 level on Tuesday and set a flat move during the U.S. session, as of writing, pair went up 0.6% in the day at 1.2225 and awaiting to EU inflation data tommorrow. Euro vast gains amid greenback struggle to find the upside momentum while it free fall to 89.69 level which the lowest point since Feb. Moreover, U.S. shares market went down that without safe-parking demand to dollar, U.S. 10 years Treasuries yield slightly changed. For technical aspect, RSI indicator shows 72 figures, which suggest a overbought sentiment in short term. On average price view, 15-long SMA indicator is ongoing ascending trend in day market after it euro aimed to higher stack and 60-long SMA retained upside slope.

As price action at current stage, we think market is ongoing track the bull side as it stand above 1.22 level. However, we need to see what ECB will do after inflation data released.

Resistance:

Support: 1.22, 1.2151, 1.2106, 1.207

GBPUSD (4 Hour Chart)

Sterling retreated from 1.42 level after once advanced to multi-month highs at 1.422. Nevertheless, Sterling surged up to higher stack that breakthrough where we thought is a critical level at 1.4155 in short run, trading at 1.419 with 0.4% gains in the day market. At the meantime, the Kingdom unveiled the ILO unemployment rate for the three months to March, which shrank to 4.8% beat 4.9% expected. For RSI side, indicator shows 66.2 figure after it exceeded over bought area in Asian session, suggesting a bullish momentum at current stage. On the other hands, 15-long SMA indicator remaining north side and 60-long SMA indicator remaining a ascending movement.

Overall, we expect sterling will test 1.42 level again that long-holder to see if strong enough for the bull momentum. Therefore, we see it first immediately support level would be 1.4 around for long-favour.

Resistance: 1.42

Support: 1.3959, 1.4, 1.4108

XAUUSD (4 Hour Chart)

Gold retreated from months perch level at 1875 level, it still extended the days victory to higher stage amid risk-on mood while it remain balance above downside trend, trading at 1870 as of writing. Meanwhile, greenback slipped to nearly year-long nadir after some Fed official reiterated that they will maintain the current ultra-eaing monetary policy regardless of the pickup inflation. For moving average side, 15-long SMA indicator retained it slope to upside trend and 60-long SMAs indicator retaining it north side momentum. For RSI side, inidcator shows 68 figures after it landing in over bought territory, suggesting bull market move at current stage.

As we mention yesterday, we still need to be patient to affirm whether it could stand firmly above the multi-month-long downside trend as yellow line. Morever, market has bought-in the expectation of substantial and widespread inflation but gold seems just creep up to sod far. Therefore, we still need the upside risk and further long-side moementum.

Resistance: 1900

Support: 1850, 1812.88, 1800, 1763.837

Economic Data

Daily Market Analysis

Market Focus

U.S. stocks fell for the first time in three sessions and the dollar weakened as investors mulled risks to the economic outlook including inflation and a spike in Covid-19 cases in parts of the world.

Technology and communication services led the benchmark S&P 500 into the red, while energy shares rose. Apple and Microsoft weighed on the tech-heavy Nasdaq 100. Semiconductor stocks continued to be under pressure, with the Philadelphia Semiconductor Index dropping as low as 10% from a peak in early April.

Bitcoin tumbled to as low as $42,133 before stabilizing after a volatile weekend that saw Tesla Inc. Chief Executive Elon Musk whipsaw prices with a series of tweets that touched on the energy usage of the cryptocurrency and whether he was selling. Coinbase Global Inc. fell to a record low and below the reference price used in its April direct listing. Gold climbed to the highest in more than three months.

Elsewhere, Oil edged up as rising optimism around a demand recovery in regions such as the U.S. offset Covid-19 flare-ups in parts of Asia.

Main Pairs Movement:

The greenback traded lower in modest turnover as U.S. economic optimism helped lift an index of commodity prices most in a month, boosting resource-related currencies including the Australian and Canadian dollars. The pound climbed for second day as U.K. economy reopens.

Federal Reserve Vice Chair Richard Clarida said during a webinar that weaker-than-expected April payroll report shows “we have not made substantial further progress” on the central bank’s goals for employment and inflation laid out as thresholds to begin scaling back the central bank’s massive monthly bond purchases.

Concerns that policy makers may have to pull back support sooner than expected to quell rising inflation have weighed on global equities. Investors this week will parse the minutes from the Federal Open Market Committee’s latest meeting for any discussion about accelerating price pressures, and hints of a timeline for reducing asset purchases.

USD/CAD falls as much as 0.4% to 1.2061, on pace for lowest close in six years; eyes the YTD low of 1.2046. Loonie gains supported by rising WTI oil prices and gold; the Bloomberg commodity index jumps 1.4%, biggest gain in a month.

USD/JPY remains lower, trades -0.2% at 109.19; bids anticipated beneath 109.00 while macro-offers are placed around 109.50, according to traders.

Technical Analysis:

EURUSD (4 hour Chart)

Euro fiber pair end Monday little change around 1.2157. A scarce macroeconomic news and fading risk-appetite maintained pairs at the upper end of it slightly range. For technical aspect, RSI indicator shows 59.4 figures, which suggest a bullish momentum sentiment. On average price view, 15-long SMA indicator is ongoing ascending trend in day market after it euro slightly upper change and 60-long SMA turned slightly upside slope.

As price action at current stage, price momentum seems ongoing with gain traction in recently days, expecting market could testing next psychological level at 1.22 if 1.215 could hold and remain bull.

Resistance: 1.22

Support: 1.2151, 1.2106, 1.207

GBPUSD (4 Hour Chart)

Sterling rose to nearly day high for the second day in a row and recently which printed the fresh high at 1.414 level, boosted by fell dollar and also by a retreat in EUR/GBP. During the U.S. session the dollar lost momentum and pulled back, even as three main U.S. shares market under pressure. Sterling was supported by fix-related buying and improved risk tone following comments by BOE Vlieghe on stimulus; 1.4237 is the YTD high in February. For RSI side, indicator shows 64 figure, suggesting a bullish momentum for short run. On the other hands, 15-long SMA indicator turn slope to north way in the day and 60-long SMA indicator remaining a ascending movement.

All of all, sterling has successfully breached over 1.41 level to challenging last time high at 1.4155. Moreover, we see there still have a room for upper stage as bullish momemtun retained in relative strong indicator. Therefore, we see first immediately resistance will on 1.4155 and 1.42 follow.   

Resistance: 1.4155, 1.42

Support: 1.3959, 1.4, 1.4108

XAUUSD (4 Hour Chart)

Gold consecutive two day gains to nearly multi-month high after it hover over 1.26%, trading at 1865.9, as U.S. share extended to day to day low and U.S. 10 year Treasuries yields had 1% upper gain. For moving average side, 15-long SMA indicator retained it slope to upside trend and 60-long SMAs indicator retaining it north side momentum. For RSI side, inidcator shows 71 figure, suggesting over bought sentiment at current stage.

As price action, we see gold has tried to penetrated multi-month downside trend. Overall, we await of gold whether could stand above downside trend solid for upside favor. For longer perspective, if it could stand above and not break below 1850, gold would head to 1900 level.

Resistance: 1900

Support: 1850, 1812.88, 1800, 1763.837

Economic Data

Dear Client,

Warmly reminds you that the component stocks in the stock index spot generate dividends. When dividends are distributed, VT Markets will make dividends and deductions for the clients who hold the trading products after the close of the day before the ex-dividend date.

Indices dividends will not be paid/charged as an inclusion along with the swap component. It will be executed separately through a balance statement directly to your trading account, the comment for which will be in the following format “Div & Product Name & Net Volume ” .

Please note the specific adjustments as follows:

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

Daily Market Analysis

Market Focus

U.S. stocks rose and Treasury yields declined for a second consecutive day as more-tempered commodity prices helped allay concerns about inflation risks.

Energy and technology shares led the S&P 500, which tumbled Wednesday by the most since February. The tech-heavy Nasdaq 100 outperformed the broader index, suggesting a market recovery is gaining momentum, after a bruising week that saw gathering price pressures hit equities. Both indexes still finished the week in the red. An advance in European stocks was led by cyclical industries. MSCI Inc.’s Asia-Pacific share gauge advanced more than 1%.

Markets appear to be regaining their equilibrium at the end of their biggest retreat in 11 weeks, with the focus of the benefits of an economic rebound overriding worry about the negative side-effect of inflation, for now.

That may help to reinvigorate the reflation narrative of picking value shares tied to economic growth over pandemic stay-at-home favorites. Walt Disney Co. fell after results that showed a faltering in growth at streaming service Disney+.

Main Pairs Movement:

The dollar slid against all of its Group-of-10 currency peers as yields fell and data showed retail sales stalled, while consumer sentiment deteriorated unexpectedly as Americans grew increasingly concerned about inflation. Losses in dollar index may come with mid-month rebalancing.

The Federal Reserve’s policy is in a good place right now, said Cleveland Fed President Loretta Mester, while playing down signals from data that she warns will be volatile as the economy reopens.

Treasuries gained after a report showed U.S. retail sales stalled in April following a sharp advance in the prior month. The dollar remained weaker against all of its Group of 10 peers.

NOK/USD dropped as much as 1.5%, most since November. AUD/USD rose 0.7% to 0.7785 amid rising gold and oil prices and gamma-related activity. USD/CAD fell as much as 0.7%, the most since May 6, to 1.2081. Report showed Canadian wholesale trade rose 2.8% in March, beating estimates of a 1% advance.

Technical Analysis:

EURUSD (4 hour Chart)

Euro fiber is heading thereto daily high above 1.21 after the U.S. reported no change in April’s retail sales which is below 1% expected, trading at 1.2143 with 0.54% gains as of writing. In ECB monetary statement, phrase from the latest meeting noted the Governing Council did not discuss any tapering of the bond purchase programme. A positive assessment, however, came after members acknowledged that risks to the activity are now slightly tilted to the upside. For technical aspect, RSI indicator shows 61 figures, which suggest a bullish momentum sentiment. On average price view, 15-long SMA indicator is ongoing flat move in day market and 60-long SMA turned slightly upside slope.

According to price action, euro seems to poised to testing the 1.2151 level as a small-scale neckkine of last perch point like yellow range. As price movementum seems ongoing with gain traction, we expect market could penetrate 1.2151 level to next higher level. Therefore, for slide way, we stay tune in 1.2106 level which we deemed a first immediately support then 1.207 follow.

Resistance: 1.2151, 1.22

Support: 1.2106, 1.207

GBPUSD (4 Hour Chart)

Pound traded has teeny-tiny gains in the day market while is trading close to 1.41 level where settle at 1.40956 as of writing. Of course, day hovers bebefitting from the better market mood as global share market rejuvenated from recently bleak side that seems re-trigger risk-on mode in subtle. For RSI side, indicator shows 59 figure, suggesting a bullish momentum for short run. On the other hands, 15-long SMA indicator retain south side trend after yesterday hard land in the day and 60-long SMA indicator remaining a teeny-tiny ascending movement.

Overall the market move in day, pound once poised to testing 1.41 level but tun it head after fail to occupy the spot. In lights of recently perspective, we still foresee 1.4 level would be and have to be the strong support for bullish favour despite faltering movement. As move averaging manifest mixed way and comprehence before views, we expect market will high probability that stymie in range between first resistance and support. For longer interval, we foresee sterling could challenge 1.4155 level if market got fueled by buy-in demand.    

Resistance: 1.4155, 1.42

Support: 1.3959, 1.4

XAUUSD (4 Hour Chart)

Gold has rallied up to closer the multi-month perch since February which have a edge over in inflation period in terms of market consensus, trading at 1843.43 as of writing. Meantime, the ongoing downfall in the U.S. Treasuries bond yield failed to assist greenback to monetize on this week’s positive move which inspired by torrid U.S. CPI report. For RSI side, indicator continue rallied to higher stage, shows 64.46 figure which suggest a bull movement. For moving average side, 15-long SMA indicator turn it slope to upside trend and 60-long SMAs indicator retaining it north side momentum.

For current stage, we expect gold will toward to 1850 level to testing a bullish momentum and psychological resistance level. On down way, the most likely vital support could be 1800 and short run support level could be 1812.8 around as substantial price located in.

Resistance: 1850

Support: 1812.88, 1800, 1763.837

Economic Data

Daily Market Analysis

Market Focus

Stocks halted a three-day slide, with investors migrating to value from growth companies as signs of a strengthening labor market tempered inflation worries.

Industrial and financial shares led gains in the S&P 500, while energy producers joined a slump in oil. The tech-heavy Nasdaq 100 underperformed major equity benchmarks as Tesla Inc. slipped after Chief Executive Officer Elon Musk said the electric-car maker is suspending purchases using Bitcoin. In late trading, Coinbase Global Inc. sank as the biggest U.S. cryptocurrency exchange reported revenue below Wall Street estimates.

Confidence on an economic revival that’s reigned supreme amid continued Federal Reserve stimulus has been recently jolted. Data Thursday showed producer prices rose by more than forecast in April, and jobless claims fell. While some investors insist the surge in inflation is a one-off reopening burst, the broader markets are hedging against the possibility it may persist and force the central bank to take action.

Officials have been trying to drive home the message that they see inflation spikes this year as transitory, in contrast with heightened Wall Street concern about runaway prices. Increases above the central bank’s 2% goal should be temporary, but may last through 2022, said Fed Governor Christopher Waller.

The Fed tweaked its plans for buying Treasuries, keeping the monthly pace at about $80 billion but focusing more attention on securities maturing in seven years or longer.

Main Pairs Movement:

A gauge of the dollar’s strength stalled Thursday on the back of the biggest rally in two weeks, with traders weighing signs of a reopening economy against risk that higher inflation may persist. U.S. 10-year Treasury yields slid and the benchmark S&P 500 rose. 10-year Treasury yields slid to 1.67% as commodity prices eased.

Still, an index measuring the three-month implied volatility of the Bloomberg Dollar Spot Index retreated after reaching the highest since April; the Bloomberg Commodity Index fell.

Traditional haven currencies such as the Swiss franc and Japanese yen advanced as commodity-linked peers, such as the Canadian and Australian dollars slipped versus the dollar. USD/JPY slid 0.2% to 109.50; Pair may be supported by a substantial amount of short-dated forward hedging at the 109.58 spot equivalent level, DTCC data shows. AUD/USD rose as much as 0.4% to 0.7746, erasing an earlier loss.

The New Zealand dollar was among the day’s top-performing Group of 10 currencies amid better risk tone, though nearly NZD1.3b of 0.7260/70 strikes expiring May 18 may slow climb. NZD/USD jumped 0.3% to 0.7180 after earlier rising 0.5%, the most since May 7.

Technical Analysis:

USDJPY (4 hour Chart)

Japan yen remains struggling in in tiny way with consolidative movement throughout the day market, losses -0.14% while trading at 109.449 as of writing. Meantime, U.S. shares market comvalesced from yesterday bleak as initial jobless claim data beat expectation led greenback enact risk-on sentiment intraday. For technical aspect, RSI indicator shows 59 figures, which suggest a bullish momentum sentiment. On average price view, 15-long SMA indicator is ongoing upper slope in day market and 60-long SMA turned slightly upside slope.

According to price action, it seem yen built a comfort short term support in 109.45 arounn which is lowest point in the day. For long term views, we believe yen will go along with indicators momentum, namely, ratch up to higher floor. Therefore, the first immediately is on 109.45 and the critical support level will be 109.042.

Resistance: 110

Support: 109.45, 109.042, 108.37, 107.937

GBPUSD (4 Hour Chart)

Pound traded with stress below the recently low level as U.S. PPI rose 0.6% in April after surging to 1% in March. For YoY aspect, the PPI boom to 6.2% which is the biggest rise record since 2010. Pound trading at 1.4053 with withhold unmove in the day market. For RSI side, indicator shows 49 figure, suggesting a neutral momentum at this stage. On the other hands, 15-long SMA indicator retain south side trend after hard striked in the day and 60-long SMA indicator remaining a teeny-tiny ascending movement.

Overall the market move in day, pound once poised to testing 1.4 level but pull up after mire in the daily low. In lights of recently perspective, we still foresee 1.4 level would be and have to be the strong support for bullish favour despite faltering movement.

Resistance: 1.4155, 1.42

Support: 1.3959, 1.4

USDCAD (Daily Chart)

Loonie continue it bounced up trail which once achieved weekly high above 1.22 level then slightly retreated modestly, trading at 1.216 with up 0.24% as of writing. Bank of Canada Governor noted on Thursday that further loonie strength could impact policy decision. Meantime, WTI crude oil drop 3.51% in the day, industrial material wide-ranging retreat it upside traction as greenback missed bullish movement.

For RSI side, indicator continue rallied to higher stage, shows 56 figure which suggest a slightly-bull movement. For moving average side, 15-long SMA indicator remaining upside movement and 60-long SMAs indicator turn it slope to positive way.

As we mentioned recently, loonie successive it correction of bearish traction to higher level, yet, ubdermine the momentum after touched 60 SMA indicator. For currently, we expect market will extend it consolidation movement in range between 1.2264 and 1.2079.

Resistance: 1.2264, 1.238, 1.2491

Support: 1.2079

Economic Data

Daily Market Analysis

Market Focus

The S&P 500 Index slumped the most since February and bond yields jumped after a report showed inflation rose more than forecast, adding to concern that price pressures will stifle a recovery in the world’s biggest economy.

The technology sector continued to lead the retreat in equities, with Apple and Microsoft pacing a 2.6% decline in the Nasdaq 100. Cathie Wood’s ARK Innovation ETF resumed its slide, bringing this year’s loss to about 18%. After closing at a record high on Friday, the benchmark S&P 500 dropped 2.14%. Energy was the only one of the 11 industry sectors to finish in the green. Treasury yields surged the most since March.

The debate over whether inflation will be persistent enough to force the Federal Reserve to tighten policy sooner than current guidance suggests comes as abundant stimulus has powered a rally in global equities, raising concerns valuations had become expensive. Fed Vice Chair Richard Clarida said he was surprised by the rise in consumer prices and “we would not hesitate to act” to bring inflation down to its goals if needed.

The consumer price index increased 0.8% from the prior month after a 0.6% gain in March. Excluding the volatile food and energy components, the so-called core CPI rose 0.9% from March.

Elsewhere, the claim among advocates that Bitcoin is an inflation hedge appears to be in question after the CPI report. The digital asset slumped as much as 5.8% to around $53,600.

Main Pairs Movement:

The dollar advanced against its Group of 10 currency peers and 10-year Treasury yields surged after a report showed U.S. prices climbed in April by the most since 2009, testing the Federal Reserve’s message that accelerating inflation will prove transitory.

The Australian and New Zealand dollars fell the most among G-10 currencies as wider risk-off sentiment offset the exuberance in commodity markets. AUD/USD fell 1.4% to 0.7736, after dropping as much as 1.5% earlier, the most since March. The Aussie fell versus most major currencies as long positions taken prior to the government’s stimulatory budget were cut, according to Asia-based FX traders. NZD/USD slid 1.5% to 0.7164; pair earlier fell as much as 1.7%, the most since March.

EUR/USD slipped 0.6% to 1.2081; pair retreats after failing to close above 1.2175 and move to Feb. 25 high. The European Commission upgraded the euro area’s growth forecast for this year to 4.3% from 3.8% after taking account of the 800 billion euro ($971 billion) joint recovery fund for the first time

Technical Analysis:

USDJPY (4 hour Chart)

Japan yen break above 109.5 level amid higher U.S. 10 years Treasuries yields keep picking up while greenback gains upside momentum during the American session, reaching the highest level since May 3 where trading at 109.62 as of writing. As share market tumble, risk aversion sentiment contributes to the demand for the safe-haven currency. For technical aspect, RSI indicator shows 67.8 figures, which suggest a bullish momentum sentiment. On average price view, 15-long SMA indicator turn upper steep slope in day market and 60-long SMA turned slightly upside slope.

On price action, it’s obviously that yen has penetrated a downside resistance as yellow line in the char, moreover, price position has breached the last time high. Thence, we foresee market could challenge first resistance at 110 level if market could retain upside momentum. Meanwhile, U.S. 10 years Treasuries yields could also driven the yen direction with positive correlation in further market.

Resistance: 110

Support: 109.042, 108.37, 107.937

GBPUSD (4 Hour Chart)

Sterling turn head to south way after U.S. CPI beat estimates with 4.2% while Core CPI final with 3%. In earlier session, U.K. GDP released better-than-expectation figures with

-1.5%, fueled volatility. In the day market, sterling traded lower stage with loss 0.63% while trading at 1.40533 as of writing. For RSI side, indicator shows 49 figure, suggesting a neutral momentum at this stage. On the other hands, 15-long SMA indicator turn it slope to the south side after hard striked in the day and 60-long SMA indicator remaining a teeny-tiny ascending movement.

Overall the market move in day, sterling slipped which seems affected by risk-off mode that propel greenback demand. Moreover, it also digest strss of over bought sentiment in short term. For long perspective, we still optimistic for gain traction ahead if any correction could be defend before the neckline level on 1.4.

Resistance: 1.4155, 1.42

Support: 1.3959, 1.4

USDCAD (Daily Chart)

Loonie bounced up after reaching the lowest intraday level since 2015, trading at 1.21284 with 0.23% gains in the day. The U.S. 10 years Treasuries yields jumped to 1.695%, reaching the highest level in the month and challenged last time peak at 1.762% while global share market plummet. Meantime, WTI crude oil boost with nearly 0.6% in the day, industrial material wide-ranging retreat it upside traction as greenback climbed. For RSI side, indicator bounced back from over sought territory to 49 threholds where suggest a neutral momentum at current stage. For moving average side, 15-long SMA indicator turrn slope to acending way and 60-long SMAs indicator remaining it descending movement.

As we mentioned yesterday, loonie set a comfort support level as price cluster at 1.2079 around and day market has bounced up to recently-day high after testing the support level. We expect loonie is on the way of correction of downside traction in the short-run that kept a lid on rapidly appreciation stress in recently.

Resistance: 1.2264, 1.238, 1.2491

Support: 1.2079

Economic Data

Dear Client,

Please note change of the following some products due to The Birthday of the Buddha,Whit Monday and Memorial Day.

If you have any questions, our team will be happy to answer your questions. Please mail to [email protected] or contact the service online.

Daily Market Analysis

Market Focus

Energy, financial and industrials shares led U.S. stocks lower as the pullback centered in the technology sector widened while investors remained on edge over the threat of inflation.

The tech-heavy Nasdaq 100 erased a loss of almost 2% to finish little changed as some dip buyers emerged. The benchmark S&P 500 dropped for a second day after setting a record high on Friday. Treasury yields edged up and the dollar traded near the lowest levels of this year.

Debate rages over whether the expected jump in price pressures will be enduring enough to force the Federal Reserve into tightening policy sooner than current guidance suggests. Fed Governor Lael Brainard said policy makers must show continued patience as distortions in the post-pandemic boom sort themselves out while the economy is still far from the central bank’s objectives.

Among the biggest pandemic winners, tech stocks whose valuations often depend on earnings prospects far into the future are now at the center of the inflation debate. That was epitomized in Cathie Wood’s Ark Innovation ETF, which has tumbled about 15% so far this year after surging almost 150% in 2020.

Main Pairs Movement:

The dollar erased losses as the stocks fell for a second day. Still, the greenback remained lower against most of its Group-of-10 peers as investors focused on inflation concerns with a report due Wednesday that may show a quickening in price increases in April. The pound extended gains for a third session.

The rise in yields also helped the greenback; U.S. 10-year Treasury yields rose through the 50-DMA level to 1.6289, the highest since May 3. Broad-based gamma demand is appearing ahead of U.S. consumer inflation data Wednesday with traders positioning for a price surge and dollar weakness. The surge in prices of commodities in recent days is also intensifying the debate about inflation and the timing of tapering in central-bank accommodation.

A spike in futures turnover helped drive day’s high; month-end hedging near 1.2150 keeps pair supported; offers anticipated near 1.2200, according to traders. EUR also seeing demand gamma ahead of U.S. CPI data. USD/JPY slid 0.2% to 108.64, Pair seems finds support ahead of 108.34, the May 7 March 10 lows.

Technical Analysis:

EURUSD (4 hour Chart)

Euro fiber has experienced a struggle to continued gains in earlier momentum that once propel to last day high before retreating to current stage, trading at 1.2147 with 0.15% higher as of writing. From report, “The ground for the euro area recovery is getting firmer and firmer” European Central Bank council member said. For technical aspect, RSI indicator shows 58.7 figures, which suggest a slightly-bullish movement expectation. On average price view, 15-long SMA indicator turn flatter move and 60-long SMA turned upside slope in day market.

We foresee market it pretty optimistic for gain traction in further movement if it can hold above 1.2105 level . On down way, the first immediately support level is eye on 1.2105 level, 1.207 and 1.2 following. On up way, we see 1.215 level will be the first tackle resistance as market tamp down which formed by price cluster area.

Resistance: 1.215, 1.22

Support: 1.2105, 1.207, 1.2

GBPUSD (4 Hour Chart)

Sterling is trading higher by 0.17%, trading at 1.4141 as of writing, extended it recently strong movement to the upper stack on relief over the Scottish election results, improved economic forecasts, and lockdown easing estimations. For RSI side, indicator has remained over bought sentiment with 74 figure while market retreat under 1.4155 level. On the other hands, 15 and 60-long SMAs indicator are accelerating it upward slope.

In the day market, sterling slightly move when investor are awaiting of GDP data ahead. At the meantime, chairman of BoE will speak after data release. Therefore, we expect market will impacted by aforemention event with roller coaster move. Nevertheless, we remain the optimistic for upward traction as it seemingly heading to 1.42 level which close to last highest spot after it break through a month-long bottom patter where neckline is on 1.4 level. Since, we see first immediately defend barrier is on 1.4 and 1.396 following.

Resistance: 1.4155, 1.42

Support: 1.3959, 1.4

USDCAD (Daily Chart)

Loonie continues to move slightly downside way around 1.21 level which is struggling to aim direction in recently, trading at lower position at 1.2098 as of writing. Meantime, WTI crude oil traveling at higher step with nearly 0.8% in the day, copper also getting higher with 1.7% gains intraday which breach all time peak in history. For RSI side, indicator bounced back from over sought territory to 30 threholds. For moving average side, 15 and 60-long SMAs indicator are remaining it descending movement.

We see price momentum seemingly gird around 1.21 level after it touched down in day market. Moreover, price is forming a cluster area while low bound setting at 1.2079 where we believe is a short-term first support line.

Resistance: 1.2264, 1.238, 1.2491

Support: 1.2079

Economic Data

Daily Market Analysis

Market Focus

Technology shares led U.S. stocks lower as surging commodity prices stoked concern about whether inflation will derail a growth rebound in the world’s largest economy and spoil a record stock rally.

The tech-heavy Nasdaq 100 Index tumbled 2.6% amid the growing anxiety over inflation, which can threaten longer-horizon revenues typical of the sector. Tesla and Apple were among the biggest decliners. The ARK Innovation ETF resumed its slide. The Dow Jones Industrial Average briefly topped 35,000 for the first time. The benchmark S&P 500 fell from an all-time high. Treasury yields edged higher as traders brace for a busy week of auctions.

Copper jumped to a record while iron ore futures surged more than 10%, adding to concern about inflation. West Texas Intermediate fluctuated after a cyberattack forced the closure of a key U.S. pipeline, which operators hope to reopen by the end of the week.

The run-up in raw materials is intensifying debate ahead of a U.S. CPI report Wednesday that is forecast to show price pressures increased in April. The data will be closely watched by policy makers at the Federal Reserve trying to gauge the speed of the recovery after job growth significantly undershot forecasts.

Main Pairs Movement:

The dollar pared losses as equities weakened and some commodities fell. The British pound jumped to its highest since late February against the greenback after the Scottish National Party’s election showing pushed back risk of an imminent vote on independence.

Currency price action may be influenced by cross-border bond issuance including Canada announcing its first U.S. Dollar bond sale since pandemic and as China Railway Construction eyes debut euro bond.

GBP/USD rose as much as 1.2% to 1.4158, the highest since Feb. 25. Pound was also buoyed by corporate and option buying and interest from macro accounts to reestablish long sterling positions.

Commodity-linked currencies from Australia, Canada and New Zealand pared intraday gains. AUD/USD was little changed after earlier advancing by as much as 0.6 to the highest since late February; AUD saw interest in 2-month 0.8025 call options. NZD/USD rose as much as 0.1% to 0.7272. USD/CAD slid by 0.3% to 1.21, the lowest since September 2017.

Technical Analysis:

EURUSD (4 hour Chart)

Euro fiber once touched topped of the day at 1.2171 level before trims intraday gains, holding negative territory while close to the end of the day, trading below 1.215 level at 1.213 as of writing. At the same time, greenback remains the weakest currency across the boarded-FX market. For technical aspect, RSI indicator shows 58 figures, which alleviate recent over bought sentiment that push down to smooth threholds. On average price view, 15-long SMA accelerating it ascending slope and 60-long SMA turned it slope to teeny-tiny upside in day market.

We foresee market it pretty optimistic for gain traction market seems to buiding upward momentum despite euro dollar correction it bull movement. On down way, the first immediately support level is eye on 1.2105 level, 1.207 and 1.2 following. On up way, we see 1.215 level will be the first tackle resistance as market tamp down which formed by price cluster area.

Resistance: 1.215, 1.22

Support: 1.2105, 1.207, 1.2

GBPUSD (4 Hour Chart)

Sterling has raised overall among the top performance on Monday, following last week’s elections. After touching its highest level since Feb at 1.415 around in early Amerian session, the pair holding a slightly move phase, trading at 1.4122 with 1% rising. For RSI side, indicator has breached to 78 figures which show market is experiencing a torrid sentiment. On the other hands, 15 and 60-long SMAs indicator are accelerating it upward slope.

In the near-term, the sterling is likely to eye on this week’s U.K. data releases and BoE governor speaking after good news of main party pushing for independence in Scotland failed to win. At current stage, we believed pound could challenge for higher stack to toward last peak at 1.42 around as market is piling into long position. However, BoE Govornor will speaking at tommorrow for prospect the eco outlook that could drive wrong-foot flucutation. For bull favour, the first immediately support is tracking psychologically spot on 1.4 level.

Resistance: 1.4155, 1.42

Support: 1.3959, 1.4

USDCAD (Daily Chart)

Loonie had another downside tractions which step down 1.21 level as greenback remains poor movement and broadly stronger commodities prices in the day market, trading day to day low at 1.2092 as of writing. Meantime, WTI crude oil traveling at bear step with slightly move in the day but industry material are edged higher stage as expectation of price inflation seems on the trajectory. For RSI side, indicator shows 22 figures which suggest an over sought sentiment, moreover, it consecutive for days long. For moving average side, 15 and 60-long SMAs indicator are remaining it descending movement.

We see price momentum seemingly gird around 1.21 level after it touched down in day market. Therefore, we expect market will eye on downside correction movement as it fell down to current stage.

Resistance: 1.2264, 1.238, 1.2491

Support: 1.21

Economic Data

Dear Client,

Warmly reminds you that the component stocks in the stock index spot generate dividends. When dividends are distributed, VT Markets will make dividends and deductions for the clients who hold the trading products after the close of the day before the ex-dividend date.

Indices dividends will not be paid/charged as an inclusion along with the swap component. It will be executed separately through a balance statement directly to your trading account, the comment for which will be in the following format “Div & Product Name & Net Volume ” .

Please note the specific adjustments as follows:

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