CURRENCIES

GBP/USD:

• Current Sentiment: 56.68% of clients are bearish, with a short-to-long ratio of 1.31 to 1.
• Trend: Increase in net-short bets by 4.62% since yesterday and 33.04% from last week. Bullish bets decreased by 16.10% since yesterday and 36.14% from last week.
• Contrarian Insight: Predominantly bearish sentiment suggests potential for the exchange rate to rise in the near term.

EUR/USD:

• Current Sentiment: Short-to-long ratio at 1.85 to 1, with overwhelming bearish sentiment.
• Trend: Net short positions increased by 3.04% from the previous session and 21.13% from a week ago. Bullish bets decreased by 12.01% from yesterday and 33.13% from a week ago.
• Contrarian Insight: Heavy bearish positioning indicates a potential rise for EUR/USD.

NZD/USD:

• Current Sentiment: 52.92% of traders are net short, with a short-to-long ratio of 1.12 to 1.
• Trend: Net-short positions increased by 13.39% from yesterday and 19.25% from last week. Bullish bets decreased by 19.57% from yesterday and 26.14% from last week.
• Contrarian Insight: Net-short positioning suggests potential for NZD/USD to rise further.

STOCK MARKET

Key Points:

• Mystery Position: Berkshire’s stake in Chubb ends months of speculation about its undisclosed financial firm investment.
• Regulatory Filings: Berkshire disclosed the position reflecting its end-of-first-quarter holdings.
• Strategic Moves: Berkshire has been increasing its equity stakes in banks, insurance, and finance companies while reducing stakes in consumer products.
• Confidentiality: Berkshire’s confidentiality in amassing large positions is to avoid market disruption.

Market Sentiment:

• David Kass Commentary: Finance professor at the University of Maryland noted the importance of confidentiality for Buffett.
• Chubb’s Industry Role: Chubb is a major property-casualty insurer operating in 54 countries, covering various risks.

Berkshire’s Insurance Expertise:

• Core Business: Insurance is central to Berkshire’s operations, with other investments in companies like Geico and National Indemnity.
• Strategic Investments: Berkshire also holds stakes in Aon Plc and has invested in Marsh & McLennan Cos.

Recent Events:

• Baltimore Bridge Incident: Chubb insured the collapsed Francis Scott Key Bridge in Baltimore, with a $350 million payout expected.
• Berkshire’s Recent Moves: At the recent annual meeting, Berkshire revealed trimming its stake in Apple Inc. due to several challenges facing the tech giant.

Financial Performance:

• Cash Pile: Berkshire’s cash reached a record $189 billion at the end of March, projected to hit $200 billion by the end of this quarter.

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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].

CURRENCIES

Upcoming Release

• The U.S. Bureau of Labor Statistics will release April’s consumer price index (CPI) data on Wednesday morning.
• This crucial economic report is closely tracked by market participants for its significance to the Federal Reserve’s monetary policy path.

Context

• Following Tuesday’s elevated producer price index (PPI) results, there’s a slight risk that inflation figures may also disappoint.
• This could undermine confidence in the disinflationary trend observed in late 2023, which seems to have stalled this year.

Consensus Estimates

• Headline CPI: Expected to rise 0.4% on a seasonally adjusted basis, reducing the annual rate slightly to 3.4% from 3.5%.
• Core CPI: Expected to increase by 0.3%, lowering the 12-month reading to 3.6% from 3.8% in March.

Market Implications

• Fed’s Stance: While the Fed has indicated it may wait longer to start dialing back policy restraint, it hasn’t fully committed to new hikes. An upside surprise in inflation data could lead to a more aggressive stance by the FOMC.
• Hot Inflation Numbers: If the inflation data exceeds expectations, it could signal that the recent series of robust CPI readings are part of a new trend of reaccelerating costs, affecting the Fed’s policy decisions.
• Impact on Rate Cut Bets: Higher-than-expected inflation could shift market bets away from a September rate cut, possibly delaying easing to December or beyond, and exerting upward pressure on yields and the US dollar, which would be bearish for gold prices.
• Benign Inflation Report: If inflation data is below Wall Street’s projections, it could lead to lower yields and a weaker US dollar, creating a positive environment for precious metals and reviving hopes of a Fed pivot to a looser stance in early fall.

STOCK MARKET

Upcoming Release

• On Wednesday, investors will review April’s Consumer Price Index (CPI) data, a key factor in the Federal Reserve’s upcoming interest rate decision.
• The inflation report is set for release at 8:30 a.m. ET.

Consensus Estimates

• Headline Inflation: Expected to be 3.4%, slightly down from March’s 3.5% annual gain.
• Monthly Increase: Consumer prices are expected to have risen 0.4% month-over-month, matching March’s increase.

Contributing Factors

• Energy Prices: Higher energy costs, driven by increased gas prices, are expected to contribute to a firmer headline CPI.
• Gasoline Prices: Expected to stabilize in May as geopolitical risks ease, potentially limiting further increases.

Core Inflation

• Annual Increase: Core CPI, excluding food and gas, is expected to have risen 3.6% over the past year, down from March’s 3.8%.
• Monthly Increase: Core prices are expected to have increased by 0.3% in April, compared to 0.4% in March.

Stubborn Core Inflation

• Elevated due to higher costs of shelter, insurance, and medical care.
• March saw significant increases in motor vehicle insurance (2.6%) and maintenance (1.6%), following February’s increases of 0.9% and 0.4%, respectively.

Economist Expectations

• Anticipate slower increases in motor vehicle insurance and maintenance prices in April.
• Expect disinflation trends to improve in rents and healthcare, with weaker car insurance inflation and cooling labor markets contributing to this trend.
• Predict a slight deceleration in healthcare costs, driven by lower health insurance prices.

Federal Reserve Considerations

• Inflation remains above the Fed’s 2% target, with a bumpy path anticipated to reach this goal.
• April’s hotter-than-expected producer prices indicate persistent inflation.

Fed’s Preferred Inflation Gauge

• The core PCE price index has remained steady, with a year-over-year change of 2.8% in March, matching February but slightly above expectations.

Rate Cut Predictions

• Investors expect one to two 25-basis-point cuts in 2024, down from six cuts anticipated earlier in the year.
• Federal Reserve officials suggest rate cuts may be limited this year unless inflation shows further signs of easing.

Market Expectations

• Morgan Stanley predicts three rate cuts in 2024, with the first in September, followed by cuts in November and December.
• As of Tuesday, markets were pricing in a roughly 49% chance of a rate cut at the Federal Reserve’s September meeting.

Click here to open a live account and start trading.

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].

CURRENCIES

Gold Price Technical Analysis:

• Recent Performance:
  • Gold (XAU/USD) dropped on Monday after failing to break trendline resistance at $2,375 on Friday.
  • Prices slipped back below $2,350 at the start of the new week.
• Potential Downside:
  • Support zone near May’s low and the 50-day simple moving average around $2,280.
  • If this support fails, attention shifts to $2,260.
• Potential Upside:
  • If bulls regain control, the first technical hurdle is $2,350.
  • Next resistance at the dynamic trendline, currently crossing $2,365.
  • Further upward movement could lead to a rally towards $2,420 and possibly $2,430.

EUR/USD Forecast:

• Recent Performance:
  • EUR/USD advanced on Monday, clearing its 50-day and 200-day simple moving averages near 1.0785.
• Potential Upside:
  • Sustaining the bullish breakout, overhead resistance stretches from 1.0805 to 1.0810.
  • A move beyond this barrier could lead to 1.0865, the 50% Fibonacci retracement of the 2023 selloff.
• Potential Downside:
  • If sellers drive the pair below the moving averages, sentiment could sour.
  • This may lead to a pullback towards 1.0725 and 1.0695.
  • Further losses could trigger a descent towards 1.0650, May’s trough.

USD/JPY Forecast:

• Recent Performance:
  • USD/JPY continued its upward trajectory on Monday, consolidating above 156.00.
• Potential Upside:
  • If momentum continues, resistance at 158.00 and then 160.00.
  • Exercise caution due to potential FX intervention by Japanese authorities, which could cause a rapid decline.
• Potential Downside:
  • Initial support at 154.65 during a pullback.
  • A breakdown could lead to a decline towards 153.15.
  • Persistent weakness may shift focus to trendline support and the 50-day simple moving average near 152.50.

STOCK MARKET

European and US Markets:

• European stocks and US equity futures remained within small ranges as investors awaited upcoming US inflation reports.
• Japanese bond yields climbed to decade highs.

Key Market Movements:

Europe:

• Stoxx Europe 600 index remained near a record high.
• Anglo American Plc: Edged higher following major company shake-up to counter BHP Group takeover approach.
• Delivery Hero SE: Soared up to 20% after selling its Taiwan business.
• Alcon Inc.: Jumped after an earnings beat.
• Rheinmetall AG: Dropped after missing earnings expectations.

US:

• S&P 500 and Nasdaq 100 futures showed little change.
• Regional Asian share gauge climbed, with Chinese tech shares among notable gainers.
• Earnings Reports: Tencent Holdings Ltd. and Alibaba Group Holding Ltd. to report later Tuesday.

Currencies and Bonds:

• Bloomberg dollar index remained flat.
• 10-year Treasury yields were little changed ahead of US producer prices report.
• Federal Reserve Chair Jerome Powell scheduled to speak.
• Consumer price index due Wednesday, expected to show moderation but still high.

Expert Insight:

• Oppenheimer & Co. Inc. Chief Strategist John Stoltzfus expects April CPI report to be central to market focus, with near-term volatility presenting investment opportunities.

Japan and Commodities:

Japan:

• 20-year government bond yield hit its highest level since 2013.
• Speculation of Bank of Japan reducing debt-buying to ease yen pressure.
• Japanese yen extended losses against the greenback to a two-week low.

Commodities:

• Oil: Held gains ahead of OPEC’s market outlook release.
• Iron Ore: Slumped after major Chinese developer defaulted, indicating ongoing debt crisis in China’s property sector.
• Industrial Metals: Nickel and copper climbed.
• Gold: Steady after a decline of more than 1% on Monday.

Click here to open account and start trading.

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].

Dear Client,

To provide a favorable trading environment to our clients, VT Markets will modify the trading setting of all Shares on May 20th, 2024:

1. All Shares products leverage will be adjusted to 33:1.

2. 20 Pre-market US Shares on MT5: Leverage will be 5:1 during 14:00-16:30 and 22:45-23:00; and remain 33:1 during the rest of the trading time.

3. MT5 20 pre-market US Shares: TSLA, NVIDIA, NFLX, META, GOOG, AMAZON, AAPL, ALIBABA, MSFT, SHOP, BOEING, IBM, BAIDU, JPM, EXXON, INTEL, TSM, MCD, ORCL, DISNEY.

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

Friendly reminders:

1. All specifications for Shares stay the same except leverage during the mentioned period.

2. The margin requirement of the trade may be affected by this adjustment. Please make sure the funds in your account are sufficient to hold the position before this adjustment.

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

CURRENCIES

US Dollar Movement:

• The US Dollar showed indecision last week, with upcoming US Consumer Price Index (CPI) data on Wednesday poised to potentially set a clear direction. Should the CPI align with consensus, impact may be muted, but deviations could significantly influence the dollar due to its effects on interest rate expectations.

Gold’s Market Position (XAU/USD):

• Gold attempted to continue its bullish trend as military actions escalated in Rafah. The metal ended the week on a higher note, overcoming previous downward movements and trendline resistance challenges. Future movements are likely tied to the upcoming US inflation report, which impacts Treasury yields and the dollar, potentially pushing gold towards testing its all-time high.

Sterling and Euro Focus:

• The British Pound will react to upcoming labor market data and Federal Reserve commentary. The Euro is set to respond to sentiment data and other US-centric reports and speeches.

US Labor Market Insights:

• Initial signs of a softening labor market appeared with disappointing Non-Farm Payroll (NFP) data and higher than expected jobless claims, which could restrain USD gains. However, an unexpectedly high CPI could counteract this trend.

Federal Reserve Influence:

• Statements from prominent Federal Reserve figures, including Jerome Powell, are anticipated over the coming week. Their impact might be limited unless new significant data emerges since the May 1st Fed meeting.

STOCK MARKET

Market Movements Last Week:

• The Nasdaq Composite (^IXIC) experienced a rise of just under 1%.
• The S&P 500 (^GSPC) saw a notable increase of almost 2%, surpassing the 5,200 mark for the first time since early April.
• The Dow Jones Industrial Average (^DJI) enjoyed a growth of over 2%, marking its eighth consecutive session of gains.

Key Economic Updates This Week:

• The focus this week will be on the crucial April inflation reading and a retail sales update which are likely to influence market sentiments.
• Initial jobless claims will also be closely watched following a surprise nine-month high in the first week of May.

Corporate Earnings Insights:

• Corporate reports are expected to slow down with Walmart (WMT), Home Depot (HD), and Alibaba (BABA) scheduled to release their quarterly earnings.

Inflation Expectations and Impact:

• The first look at April’s Consumer Price Index (CPI) is anticipated this Wednesday, with analysts predicting a year-over-year increase of 3.4%.
• Core inflation, excluding food and energy, is also expected to show a slight deceleration compared to the previous month.

Economic Analysts’ Perspectives:

• Morgan Stanley expects the April CPI report to signify the start of easing inflation pressures, particularly in sectors like car insurance, rent, and healthcare.
• Fundstrat’s Tom Lee suggests that softer CPI data could increase the likelihood of more Federal Reserve interest rate cuts, which would be beneficial for the stock market.

Retail Sector Performance:

• The upcoming retail sales report will shed light on consumer spending trends, with a focus on whether there is a slowdown from the 0.7% increase observed in March.
• Performance of major retailers like Home Depot and Walmart will provide additional insights into consumer behavior, particularly in discretionary versus non-discretionary spending.

Market Reaction to Economic Data:

• The market’s response to economic data has been mixed, with recent inflation data causing concerns about persistent high prices affecting the potential for interest rate cuts.
• Investors are increasingly sensitive to economic indicators that could impact the Federal Reserve’s policies and the broader economic outlook.

Click here to open a live account and start trading.

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].

Dear Client,

New contracts will automatically be rolled over as follows:

Please note:
• The rollover will be automatic, and any existing open positions will remain open.

• Positions that are open on the expiration date will be adjusted via a rollover charge or credit to reflect the price difference between the expiring and new contracts.

• To avoid CFD rollovers, clients can choose to close any open CFD positions prior to the expiration date.

• Please ensure that all take-profit and stop-loss settings are adjusted before the rollover occurs.

• All internal transfers for accounts under the same name will be prohibited during the first and last 30 minutes of the trading hours on the rollover dates.

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