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EURUSD Analysis: Anticipating a Slight Bearish Bias Towards 1.1!EURUSD Analysis: Anticipating a Slight Bearish Bias Towards 1.10000 (24/09/2024) As we analyze the EURUSD pair this week, a slight bearish bias appears probable, with a target near the pivotal level of 1.10000. Key drivers for this outlook include the recent economic data releases, central bank policies, and market sentiment. 1. Economic Data: Recent Eurozone economic indicators have shown mixed results, with weak manufacturing PMI figures suggesting slowing growth. Conversely, US economic data, particularly strong job numbers and retail sales, point to a robust economy, potentially strengthening the dollar. 2. Central Bank Divergence: The European Central Bank (ECB) is likely to maintain a dovish stance amid economic uncertainties, while the Federal Reserve appears committed to a tighter monetary policy. This divergence could exert downward pressure on the euro. 3. Market Sentiment: Increased risk aversion due to geopolitical tensions may lead investors to favor safe-haven currencies like the USD, further supporting the bearish outlook for EURUSD. In conclusion, the combination of economic fundamentals, central bank policies, and market sentiment suggests that EURUSD may trend towards 1.10000 this week. Traders should stay alert for potential market shifts and adjust their strategies accordingly. Keywords: EURUSD analysis, bearish bias, economic data, central bank policy, ECB, Fed, market sentiment, forex trading, trading strategies, 1.10000 target.
Short
by PERFECT_MFG
Understanding Economic IndicatorsUnderstanding Economic Indicators Economic indicators help us understand the state and direction of the economy, providing valuable information across the various sectors. Indicators of economic growth are widely used by businesses, investors, traders, policymakers, and individuals who care about their financial future. In this FXOpen article, we will provide the definition of economic indicators and explain how to interpret them. Economic Indicator: Definition and How to Interpret Them So, what is an economic indicator? It is a statistical measurement used to determine the health of an economy. Indicators focus on different aspects of economic activity, such as employment, inflation, and consumer spending. Interpreting economic indicators can be complex because even positive changes don’t always mean good things. For example, an increase in consumer spending may indicate a healthy economy, but it may also be associated with an increase in consumer debt. Similarly, a decline in the unemployment rate may indicate economic growth, but it may also be due to an outflow of labour. Interpreting economic indicators involves analysing data to understand the current state and future direction of the economy. Let’s consider the steps to be taken: 1. Know what each economic indicator measures and how it is calculated so that you can interpret the data correctly and not make assumptions. 2. Examine current measurements against historical data and trends to determine if the current direction is an outlier or part of a larger phenomenon. Analyse patterns to predict future changes. 3. Take into account external factors such as government policies, natural disasters, and global events. 4. Consider several metrics, as no single economic indicator can give a complete picture of the economy. 5. If you doubt how to interpret economic indicators, seek advice from an economist or financial adviser. GDP One of the most important indicators of economic growth is Gross Domestic Product (GDP). It quantifies the collective value of goods and services generated within a nation during a defined time frame, often spanning a year or a quarter. GDP is seasonally adjusted to exclude quarterly fluctuations due to climate or holidays and is also adjusted for inflation to measure changes in output rather than in the prices of goods. GDP serves as a basis for decision-making as it indicates overall growth over a specific period. GDP shows whether the economy is expanding or contracting. It also helps to establish trends in consumer spending, the state of housing and business investment, and the rise or fall in the prices of goods and services. Labour Market Labour market indicators are a set of quantitative measurements used to analyse and assess various aspects of a country's workforce. These metrics provide insights into the supply and demand for labour, the health of the job market, the quality of employment opportunities, and the dynamics of the workforce. They include various metrics, with the most popular being the unemployment rate, employment change, average earnings, initial jobless claims, participation rate, and nonfarm payrolls. Typically, high levels of employment and the regular creation of new jobs signal the strength and growth of the economy. Additionally, you can look beyond the economy as a whole and analyse the performance of specific companies. For example, you can evaluate employee turnover and retention rates or look at the return on human capital. Inflation Data Inflation data refers to information and statistics that quantify the rate at which the general level of prices for goods and services in an economy is rising over a specific period of time. Inflation is a fundamental economic concept that reflects the erosion of purchasing power over time. There are numerous inflation metrics, including CPI, PPI, inflation rate, and core inflation. CPI (Consumer Price Index) and PPI (Producer Price Index) are widely used by traders and investors to determine future price movements. CPI tracks changes in the prices of goods and services. It is used to calculate cost of living adjustments and changes in the purchasing power of consumers. PPI measures the change in prices charged by domestic producers of goods and services. It is used to calculate real growth by adjusting revenue sources for inflation. Retail Sales Retail sales data represent the total amount of goods sold by retailers to end consumers. The indicator reflects consumer demand for finished goods. It helps analysts and investors assess the health of the economy and possible inflationary pressures. Retail sales data provides insights into consumer demand, trends in spending behaviour, and the performance of different sectors within the retail industry. Core retail sales, which exclude motor vehicles, petrol, building materials, and food services, are also an important metric. Business Confidence Business confidence measures the level of optimism or pessimism that business owners have about the future performance of their companies. The Business Confidence Index (BCI) is typically measured through surveys and indices that assess the perceptions of business leaders regarding current and future economic conditions. The results of surveys can be influenced by many factors, including changes in government policies, market trends, and global events. High levels of business confidence can lead to increased investment, hiring, and economic growth, while low levels of confidence can result in decreased investment, lay-offs, and economic decline. Consumer Confidence Consumer confidence is an assessment of the degree to which consumers are optimistic or pessimistic about the state of the economy and their personal financial situation. CC is also measured through surveys. While high levels of consumer confidence can lead to increased expenditure and economic growth, low levels can lead to decreased spending. Data on consumer confidence is valuable for manufacturers, retailers, government agencies, and banks. Final Thoughts As a trading platform, we care about our clients, so we try to provide as much information as possible to help them evaluate the economy or the companies they want to invest in. Understanding economic indicators will make fundamental analysis much easier for you. To learn more about assets and instruments, explore our TickTrader platform and our blog. Once you feel confident, you can open an FXOpen account and dive into trading. This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Education
by FXOpen
3
Mortgage Delinquencies About to Skyrocket"Financial Advisors" tend to be clueless about the overall health of the market and the economy. The "advisor" profession is laced with toxic narratives about "your goals" and "focusing on the long term" and "staying invested". They're clueless as to what is going on. As the recession sets in and the market collapses, we will see mortgage delinquencies soar. Remain patient, refrain from buying ANYTHING with a debt component (ie homes / cars). We will soon see a credit freeze, as banks and lenders dump their assets and borrowers fail to meet their loan covenants. This is the real deal, folks. Stay low and move fast!
FRED:DRSFRMACBSLong
by ChiefMacro
My Bias has changed in less than 18 hours for Long-Gold. Please. So towards the end of NY session yesterday Thursday, I was a little bearish on Gold. Why? 1/ The USDX where Gold gets a lot of its' cues from had formed bullish Head 'n' Shoulders Patterns on timeframes 5m right up to 30m. You better believe it. Technicals work on the USDX as well. But the bears have been nullified. The USDX is travelling down a bearish wedge. Sure, it can jump out at any time like a thief-in-the-night. What would prompt this? Well bullish Economic Data due out soon that is supportive of the USD. 2/ Please take a look at my chart. You will see that for the most part that Gold in this 4hr chart is sailing upwards smoothly in a rising wedge. Things can change there as well, if the economic data is bad. 3/ The Economic Data for Thursday was supportive of the Gold price I thought, so I am thinking it might be good again for gold. Take a look at the chart. I highlight which economic data to be across and how it could affect the Gold-price. Regards, Chris
EIGHTCAP:XAUUSD
by Easy_Explosive_Trading
7
Gold forecast: What now for gold after scoring 7 monthly gain?I expect gold to rise further and continue to attract buying activity on any dips. One reason is that the overall trend remains bullish, which should deter bearish speculators from acting too forcefully unless there are clear signs of a reversal. Gold finished higher for the 7th consecutive month in August, meaning that the precious metal is now up a solid 21% year-to-date. Will it be able to rise further in September or take a breather? The gold forecast will now depend at least partly on incoming US data and interest rate expectations. I continue to maintain a bullish view on the metal thanks to a favourable macro backdrop and its steady-as-she-goes price action. Gold forecast: Can XAU/USD continue rising? I expect gold to rise further and continue to attract buying activity on any dips. One reason is that the overall trend remains bullish, which should deter bearish speculators from acting too forcefully unless there are clear signs of a reversal. Additionally, there are few fundamental reasons to short sell gold at the moment. In fact, some argue that gold is still undervalued, considering the significant devaluation and loss of purchasing power of fiat currencies worldwide due to high inflation, which remains persistent in some regions. While disinflation is evident in the US and other areas, it's not the same as deflation. Prices are still increasing, just not as rapidly as before. Demand for gold as an inflation hedge should continue to offer support. Moreover, the sharp decline in bond yields in the last couple of months, driven by expectations of rate cuts by the Federal Reserve, is likely to benefit low or zero-yield assets like gold. As long as we don’t see a reversal in the that trend, lower yields should argue against a sustained period of weakness for gold and silver. Dollar in focus ahead of busy week The US dollar is facing a key test this week with the release of several market moving data releases, including the August jobs report. Following today's US Labor Day holiday, the US data schedule becomes busier, featuring ISM manufacturing data on Tuesday, JOLTS job openings on Wednesday, ADP employment data, jobless claims, and ISM services on Thursday, and culminating with the key event of the week, the August jobs report on Friday. Out of all of these data releases this week, the nonfarm jobs report should be a key determinant of whether the dollar’s two-month dollar bear trend extends or whether range bound price action will return. Gold bulls will need to a weaker number to send the metal sharply higher. But if the consensus is correct regarding Friday's jobs report, which predicts 165,000 job gains and a decrease in the unemployment rate to 4.2% from 4.3%, then the market will likely solidify expectations for a 25-basis point rate cut to start the Fed's easing cycle on September 18. In this scenario, I would expect to see a modest weaker reaction in gold at least. However, if payrolls only increase slightly, say by around 100,000 or so, with the unemployment rate potentially rising too, then in this scenario, the dollar could resume lower, sending gold sharply higher as expectations shift back toward a 50-basis point Fed rate cut in September. China concerns linger Meanwhile we have had some mixed PMI readings from China’s manufacturing sector in the last couple of days, leaving investors guessing about the health of the world’s second largest economy. While the official manufacturing PMI fell further into contraction at 49.1 in August from 49.4 in July, the Caixin PMI improved to 50.4 from 49.8 the month before. Meanwhile, the official non-manufacturing PMI ticked up to 50.3, suggesting that perhaps the Chinese economy may have bottomed out. We will need to see further evidence of a Chinese recovery. If so, this will help raise hopes that elevated demand from the world’s top gold consumer nation can sustain precious metals prices at these levels or even push them higher. Gold forecast: technical analysis and trade ideas The steady grind higher is precisely what the bulls would like to see, keeping the technical gold forecast bullish. Shallow dips, higher highs, higher lows are characteristics of strong bullish trends. So, the trend is clearly bullish and will remain that way until we see a lower low form. Dips are likely to find support around broken levels such as around the old record high from July at $2483, where we also have the 21-day exponential moving average converging. The bullish trend line that has been in place since February, comes in around $2450, representing another short-term support level to watch. On the upside, there is only one prior reference point to watch given that the metal is trading near its all-time high. And that level is the all-time high itself, hit last month at $2531. -- Written by Fawad Razaqzada, Market Analyst
WHSELFINVEST:GOLDLong
by WHSelfInvest
Friday 23, N.Y Gold & USDX: Very very interesting...See charts! Happy Friday guys, I was tired & late getting into the Asian session earlier. But as soon as I locked-horns with my 42" monitor I saw that Gold & Silver were in a mild upside rally. I soon took a long position & recommended one for you in Silver which was rallying stronger than gold. The gold price struggled at resistance from 2490 to 2500, not strong resistance at 2490 but volume is always lighter in the Asian session. We quickly booked a profit, I am hoping you did as everything happened so fast in a Long trade which only lasted 40 minutes or so. What happened next? Plz read on below. I saw that price kept getting rejected at the 20 EMA on the lower-time-frame. I decided to go Short & I recommended a very small lot-size Sell-stop below where price was I think from memory my Sell-stops were around 2489 or thereabouts. Next, I distracted myself on another project on the 'hotcopper' forum with a bullish lithium company I am very heavily invested in called Raiden Resources RDN is the ticker, if you want to check it out, I will never sell Stock trades but this thing is looking good, but you google the stories on Raiden Resources if you wish. So, I had no Stops on my Short because I generally do not like Stops because I find 9 times out 10 the Market-Makers will hunt your stop down so that Mr & Mrs Market-Maker make their big fat wealthy private bank clients wealthier. Maybe that's a bit harsh, but I often wonder. So the Gold price found support because I took my eye off the field & forgot to book profits and the Gold price started to properly find support and some strength above 2490. Guys, that is enough on that. Look what concerns me in Friday trading are these bullish Head 'n' Shoulders patterns & on multiple timeframes. We are still about 0.31% from the trigger line & look they probably won't play out today, but what about next week? If the USDX does turnaround next Monday & it certainly could do that because it is very oversold on the Stochastics. However, the path of least resistance for the USDX is further down because it's below its moving averages & how many bloody times do we go Long & then close out of the trade & look at a higher-time-frame & exclaim to ourselves, 'I am an idiot the trend was down / the path of least resistance was down - Why did I go Long'. I used to do it all the time when I was a very green, greedy & gullible trader. Well I still get greedy! I will monitor these H & S's on the ASDX. I see where the boss speaks today, The Fed Chair, Mr Powell at 10am Eastern Time USA & Canada and we also have another chat from FOMC member Bostic. My feeling is that Mr Powell has maybe felt a bit anxious lately & he may give our market a bit of a boost today by reiterating the theme of interest rate reduction(s) next month which of course will bode well for Gold & Precious Metals in general. Further on the Economic Calendar today, we have Building Permits at 08:30am & then New Home Sales at 10am, the latter having a bit more weight and bearing on our trading. Unless you are looking to Short the Gold price today, with our 2 speakers hopefully talking up an interest rate reduction & if the other 2 mentions on the economic calendar come in a bit bearish then this will be poor or the USD but more than likely supportive of the Gold price and getting back above 2500, which I think is where the 50EMA sits on the 1 HR Chart. So recapping, my feeling is that today will be bullish for Gold depending on New Home Sales mostly but Mr Powell's endorsements rate reductions for the US economy commencing next month will shrug off any bearishness in the Gold price. In addition to the Head 'n' Shoulders patterns for the USDX (see the 1st set of charts), I have scouring Precious Metals searching for other H & S's patterns so I will be posting these charts so that you have a road-map for the possibility of taking these H & S trades which are predominately bullish ones, I will post these below very soon & I have tradingview alerts set for when price gets near the neckline. Cheers, Chris
EIGHTCAP:USDX
by Easy_Explosive_Trading
SPY Lovers ! Bullish and Strong but wait... there is a challengeThere's really not much to analyze here. As we can see on the chart, SPY remains strong and in an upward direction. What I'm expecting: I'm waiting for the price to reach my 565.16 zone as a rejection or liquidity point so that it can regain strength and eventually break through the zone later on. Other than that, there's not much to analyze—SPY remains strong. The challenge this week will be reaching new highs, as we have very important economic news coming up, which could bring a lot of volatility. We'll see what happens this week. Thank you for supporting my analysis.
AMEX:SPYLong
by RocketMike111
240812 Market OutlookLast two weeks adjustment was aligned with the rise in Unemployment Rate and associated worries about the possible US economic slowdown. A week ago gap was closed last Friday, but there still remain another gap on Aug-2, which slightly increase the probability of further rise in US stocks. The focus of this week is inflation data from US, including PPI on Tue, Inflation Rate on Wed and Retail Sales on Thu. Additionally, investors should pay attention to Initial Claims on Thu and Michigan Consumer Sentiment on Fri.
SP:SPXLong
by moncap2023
EUR/USD forecast: Currency Pair of the WeekThe EUR/USD poked its head above the June high of 1.0916 to reach its best level since March, after the US Empire State Manufacturing Index came out weaker than expected earlier. The US dollar has remained under pressure against most major currencies, albeit not so much against the likes of the New Zealand dollar following last week’s dovish RBNZ meeting. Still, against the likes of the euro and pound, as well as gold, the greenback has fallen further after last week’s weaker-than-expected US CPI data boosted expectations that the Federal Reserve will loosen its monetary policy at its September meeting. Already cutting rates in June, the European Central Bank will be in focus again this week. This time, no rate cuts are expected from the ECB, which, together with reduced political uncertainty in Europe and weakness in US data, should all help to keep the euro supported against the US dollar, maintaining the short-term EUR/USD forecast in bulls’ favour. EUR/USD forecast: Key macro highlights this week Apart from retail sales and a handful of other macro pointers, the US economic calendar is quite quiet this week. The same could be said about Europe’s data calendar had it not been for the ECB policy decision on Thursday. Here are this week’s key macro highlights, relevant to the EUR/USD pair: - Tuesday - US Retail Sales & Core Retail Sales m/m - Wednesday - US Building Permits US Industrial production m/m - Thursday - Eurozone Main refinancing rate & monetary policy statement US unemployment claims ECB Speech EUR/USD forecast Already, we have seen the Empire State Manufacturing Index print a below-expected -6.6 reading this week, which helped to keep the pressure on the US dollar. But it is all about retail sales on Tuesday, when building permits and industrial production data will be published too. US retail sales expected to fall The health of the US consumer is deteriorating, as was reflected by last month’s release of the May retail sales estimate, which came in at just +0.1% month-over-month. That followed a downwardly revised 0.2% fall in April. Sales at gasoline stations were particularly weak last time, falling 2.2%, while those at furniture stores, an indication of demand for long-lasting goods, slipped 1.1%. Meanwhile, recent data releases have mostly surprised to the downside and inflation has cooled more than expected. If retail sales again disappoint, then the odds of a September rate cut could surge, especially in light of last week’s weaker consumer inflation data (and UoM’s Inflation Expectations survey). ECB rate decision The European Central Bank’s next rate decision is on Thursday, July 18 at 13:15 BST. Don’t expect any fireworks this time, after it delivered its first rate cut in June. That decision was built up so much by the ECB that they simply had to cut even if policymakers were unsure about the path of inflation. Indeed, the minutes of that meeting have since revealed greater uncertainty in ECB staffs’ outlook for inflation, while private consumption showed no convincing evidence of picking up either. The ECB will remain data-dependent, something which Christine Lagarde highlighted at the last press conference in June and said there will be no pre-commitment to a particular rate path. So, don’t expect another rate cut at this meeting, but watch out for clues about the next move. EUR/USD forecast: Technical analysis The EUR/USD has broken above a couple of bearish trend lines that were there from July and December of last year. Rates have also moved and stayed above their 21-day exponential and 200-day simple moving averages. The technical EUR/USD forecast is therefore bullish as things stand. But given that it had struggled around the current levels between 1.0900 to 1.1000 area earlier this year, I wouldn’t be surprised if it hangs around for a few days here, potentially until the ECB rate decision is out of the way. Still, the short-term path of least resistance is clearly to the upside, so I wouldn’t necessarily look for bearish trades here unless the charts tell me otherwise. Key short-term support is now seen between 1.0840-1.0865 area, followed by 1.0800, where the 200-day average now resides.
by WHSelfInvest
75: China Export Analysis - Fundamental and Technical OverviewThe European Union (EU) and the United States have increased scrutiny and imposed higher tariffs on Chinese imports, particularly electric vehicles and strategic materials like gallium and germanium. These measures are designed to protect domestic industries from what are perceived as unfair trade practices and subsidies by the Chinese government. Additionally, the EU's new Critical Raw Material Act and battery regulations aim to reduce dependency on Chinese imports and secure supply chains for critical technologies. These regulatory changes have led to a noticeable decline in Chinese exports to the EU. In response, China has imposed export restrictions on key materials, further straining trade relations. These geopolitical tensions and trade barriers have significantly impacted China's export figures. Currently, China's export trend is showing a downward trajectory. The export figures have struggled to reach the $350 billion mark and are at risk of dropping significantly lower, potentially towards the $140 billion level. Chart Overview: Trend Line: A clear downtrend is visible on the chart, with lower highs and lower lows indicating sustained pressure. Support and Resistance Levels: Resistance: The $350 billion level is the upcoming resistance. That has not yet been reached. Support: Immediate support is observed around $250 billion. A break below this level could accelerate the downward move towards $140 billion. Will We Reach $350 Billion or Go Lower? Given the current economic and geopolitical landscape, it seems still likely that China will reach the $350 billion export mark in the near term because there has not been a really corrective wave in the chart. But the downward pressure from increased tariffs, export restrictions, and the EU's push for supply chain independence are significant hurdles. If these conditions persist, a further decline is a plausible scenario.
ECONOMICS:CNEXP
by SeventyFive-Invest
Premium Gold idea for this upcoming week $$$Based on historical trends and current market conditions, XAU/USD is likely to be bearish for day trading with a starting price of 2414.44. Traders should monitor real-time market dynamics and economic data releases for potential price movements throughout the upcoming week. Entry: 2414.44 SL: 2422.72 Target 1: 2370.95 target 2: 2332.10 #Xauusd #bearishtrend #daytrading #marketanalysis #financialmarkets #priceprediction #economicdata #realtimemarketdynamics Like share comment and click the follow button for more
OANDA:XAUUSD
by TradeGod003
4
China Caixin PMI SummaryChina Caixin PMI Summary Surveys completed by 650 SME's in China have indicated that China's smaller manufacturing and service providers remain in expansionary mode in April 2024 with all three data releases coming in as expected or higher than expected with readings >50 = Expansionary. Manufacturing - 51.4 Increased from 51.1 in Mar 2024 to 51.4 in Apr 2024 ✅Above expectations of 51 Services - 52.5 Decreased from 52.7 in Mar 2024 to 52.5 in Apr 2024 ✅In line with expectations of 52.5 Composite - 52.8 Increased from 52.7 in Mar 2024 to 52.8 in Apr 2024 ✅Above expectations of 52.5
ECONOMICS:CNCOMPPMI
by PukaCharts
SPY Daily - Rising WedgeTreading lightly here as the SPY looks to be right at the end of a bearish rising wedge following a bearish ABCD Elliot Wave heading into a major week economically speaking. On Wednesday we have retail sales numbers, core CPI, and Core CPI YOY coming out, followed by jobless claims on Thursday. Will be watching closely, some support levels and RSI-based supply and demand zones to keep an eye on in the meantime, bearish and hedged- (Original Chart Attached Below) - Rising Wedge following a bearish ABCD Elliot Wave - Hidden Bearish Divergence on the RSI - Sitting right on its 50-Day SMA - Bearish ABCD Elliot Wave
AMEX:SPYShort
by jacobosiason7
Today's Gold Price and Future DirectionAmidst prolonged tensions in the Middle East, global gold prices have surged, defying expectations despite robust economic data from the U.S. The sharp rise in gold prices comes as Israel signals readiness to retaliate against Iran's attacks, disregarding calls for restraint from Western nations. In the face of escalating geopolitical tensions, global gold prices show no signs of slowing down, with projections pointing towards a potential climb to the $2460 mark. Additionally, the metal is approaching a critical Fibonacci 1.618 profit-taking level, aligning with predictions from Dow Theory."
FXOPEN:XAUUSDLong
by fluxgold
Macro Monday 38 ~ The EU & German ZEW Economic Sentiment IndexMacro Monday 38 The Euro Area ZEW Economic Sentiment Index & The German ZEW Economic Sentiment Index (Released this Tuesday 19th Mar 2024) ZEW is the German acronym for the Zentrum für Europäische Wirtschaftsforschung, which translates to the Centre for European Economic Research. There are two releases from the Centre for European Economic research we will cover today both being released this coming Tuesday; 1. The Euro Area ZEW Economic Sentiment Index (Reading of 25 for Feb 2024) 2. The German ZEW Economic Sentiment Index (Reading of 19.9 for Feb 2024) EURO AREA ZEW INDEX This index is derived from 350 economists and analysts that operate from and represent the overall European Area. They include economists and analysts from different countries in the Eurozone that are using the Euro as their currency (20 countries out of the 27 members). In summary, while the EU ZEW index provides a broader perspective for the entire eurozone than the German ZEW Index discussed below, the exact methodology for distributing the surveys and their apportionment across individual countries within the eurozone is not explicitly disclosed. Historically, this index has proven very useful as a leading indicator of sentiment for the European Economy and it is closely monitoring for gauging economic sentiment in the EU by market participants. EURO AREA ZEW CHART - SUBJECT CHART ABOVE How to read the chart The index ranges from -100 (pessimism) to +100 (optimism). 0 is neutral however the historical average reading for the EU chart is 21.39 which is the point where the red area meets the green area on the chart. We show on the chart if we are above or below the average levels of optimism. The current reading of 25 indicates current optimism among analysts for the next 6 month The Trend Sentiment made a recovery from -60 in Sept 2022 to +25 in Feb 2024. We have moved from deep in negative sentiment territory to just above the historical average of the chart which is 21.39. GERMAN ZEW INDEX The German ZEW Index data is not derived from all the countries in Europe, it is derived from the views of collection of 350 economists and analysts that operate from and represent the German economy. As Germany is the largest economy within the Euro Area, its performance significantly impacts the overall region and this this metric could be considered the economic sentiment spearhead of Europe. Germany is also the 4th largest economy in the world by nominal GDP. As of 2023, its nominal GDP stands at approximately $4.43 trillion. This index could be monitored as a measure of not only European sentiment but as an important global sentiment gauge. GERMAN ZEW INDEX CHART How to read the chart The index ranges from -100 (pessimism) to +100 (optimism). 0 is neutral however the historical average reading for the German ZEW chart is 20.79 which is the point where the red area meets the green area on the chart. We show on the chart if we are above or below the average levels of optimism. The current reading of 19.9 indicates current optimism among analysts for the next 6 months, however we are below the historical average of 20.79 thus a definitive move above this level this coming Tuesday could be a confirmation step into potential sustained optimism. The Trend Sentiment made a recovery from -61 in Sept 2022 to +19.9 in Feb 2024. We have moved from deep in negative sentiment territory into positive numbers but we are not above the historic average of 20.79 yet. Lets see how both perform this coming Tuesday. The beauty of these charts is that you can review both on my Trading View at any stage, press play and it will update with the most recent release. This way you will have a full explainer of what this dataset is and can keep yourself up to date on its direction with the color coded map, the average line and the neutral line, all of which will at a glance give you a good indication of where we stand in terms of trend and sentiment. I'll keep you informed here too Thanks for coming along PUKA
ECONOMICS:EUESI
by PukaCharts
Macro Monday 13~Purchase Managers IndexMacro Monday 13 ISM Purchasing Managers Index The ISM Purchasers Managers Index (PMI) measures month over month change in economic activity within the manufacturing sector. The PMI is a survey-based indicator that is compiled and released each month by the Institute for Supply Management (ISM). The survey is sent to senior executives at more than 400 companies in 19 primary industries, which are weighted by their contribution to U.S. Gross Domestic Product (GDP). A PMI above 50 represents an expansion in manufacturing when compared with the previous month. A PMI reading under 50 represents a contraction while a reading at 50 indicates no change. The further away from 50, the greater the level of change. According to Investopedia "ISM data is considered to be a leading indicator of economic trends. Not only does the ISM Manufacturing Index report information on the prior two months, it outlines long-term trends that have been building over time based on prevailing economic conditions". The ISM reports are released on the first business day of each month for the month that has previously closed. Thus, they are some of the earliest indicators of current economic activity that investors and business leaders get regularly. Something to look out for next Monday 2nd October 2023. The PMI focuses mainly on the five major survey areas; 1. Employment (20%) 2. New orders (30%) Covered in Macro Monday 6 3. Production/Output (25%) 4. Inventory levels (10%) 5. Supplier deliveries (15%) We covered the ISM New Orders Index in Macro Monday 6 as it is the largest component of the Purchaser Managers Index making up 30% of the overall index. I will leave a link to the chart. The Chart The chart outlines the last 12 recessions (shaded red zones) with the PMI readings over the same period. As we are already aware above 50 on the PMI reading is expansionary and below 50 is contractionary (red thick line). Three Main Findings 1. In 11 out of 12 recessions a PMI reading at or below 42 was established. This means if the PMI falls to 42 there is a 92% probability of a recession. At present we have not reached that level, we are currently at 47.6. 2. The PMI has bottomed 10 out of 12 times in Quarter 1 (between Jan – March) with the remaining two bottoms happening in Quarter 2 (both in May). This means that 83% of the time the PMI cycle appears to bottom in Quarter 1 with the most bottoms in January (6) with Feb(2) and May(2) in close second place. - It’s worth noting that the bottom of the PMI cycle may not be the bottom of a stock market cycle. If we are forward looking then a rising PMI is positive for the economy and markets but ideally a move above 50 is the true signal of economic expansion from a manufacturing standpoint. 3. The average PMI bottom to bottom cycle timeframe over the past 6 cycles is 58 months with the shortest being 37 months and the longest being 86 months. We are currently at month 38 and the average month of 58 is Jan 2025 with the max of 86 months being May 2027. - How interesting is it that both these potential PMI bottom dates line up with our two most frequent PMI bottom months indicated in point 2 (January and May). - Interestingly according to U.S. government research, since WWII the business cycle in America takes, on average, around 5.5 years which closely aligns with our 58 month (or roughly 5 year) indication for the PMI chart. The business cycle incorporates an aggregate of economic data such as the ISM data, GDP and income/employment metrics. We might cover the business cycle in more detail on a future Macro Monday. The ISM New Orders Index (30% of the PMI) Similar to the ISM New Orders Index Chart (covered in Macro Monday 6) which makes up 30% of the PMI, we have not reached below the 42 level on this chart either which has provided a 100% confirmation of recession when we have had a definitive move below the 42 level historically. For ISM New Orders if we stay below a sub 50 level on the ISM New Orders Chart for greater than 7 months it has resulted in a recession every time except for 1966 and 1995 (8 out of 10 times). We are currently 14 months below the 50 level which is unprecedented, with the new orders index nudging a little lower on the August reading from 47.3 down to 46.8. ISM Data Release 2nd October 2023 When we receive our next ISM Data release next Monday 2nd October 2023 we can refer back to the PMI chart and the New Orders Index Chart and see how things have progressed and if we have reached and critical levels. These charts and the others I have completed on Macro Mondays are all designed so that you can revisit them at any point and press play on TradingView and see if we are breaking new into higher or lower risk territory. I hope they all help towards your investing and trading decisions. Have a great Monday guys, Lets get after it! PUKA
ECONOMICS:USBCOI
by PukaCharts
4
Understanding Initial Jobless Claims as a Market IndicatorIntroduction In the complex and multifaceted world of economic indicators, initial jobless claims hold a special place. As a measure of the number of individuals filing for unemployment benefits for the first time, this statistic offers a real-time glimpse into the health of the labor market, which in turn is a vital component of the overall economic landscape. This article delves into how initial jobless claims function as an indicator and their impact on the financial markets. Understanding Initial Jobless Claims Initial jobless claims refer to claims filed by individuals seeking to receive unemployment benefits after losing their job. These are reported weekly by the U.S. Department of Labor, providing a timely snapshot of labor market conditions. A lower number of claims typically signifies a strong job market, suggesting that fewer people are losing their jobs. Conversely, an increase in claims can indicate a weakening labor market, often a precursor to broader economic downturns. Initial Jobless Claims as an Economic Indicator Health of the Labor Market: The primary significance of initial jobless claims is its reflection of the labor market's health. A steady, low number of claims often correlates with job growth and declining unemployment rates, indicating a robust economy. Leading Indicator for the Economy: As a leading economic indicator, jobless claims can provide early signals about the direction of the economy. Spikes in claims can forewarn of economic contraction, while consistent decreases might indicate economic expansion. Consumer Spending: Since employment directly affects consumer income, initial jobless claims can also indirectly signal changes in consumer spending, a major driver of economic growth. Impact on Financial Markets Market Sentiment: Traders and investors closely watch initial jobless claims to gauge market sentiment. Fluctuations in these numbers can lead to immediate reactions in the stock, bond, and forex markets. Monetary Policy Implications: Central banks, like the Federal Reserve, consider labor market conditions when setting monetary policy. Rising jobless claims can lead to a more dovish policy stance (like lowering interest rates), while decreasing claims might justify tightening policies. Sector-Specific Implications: Certain sectors are more sensitive to changes in jobless claims. For instance, a rise in claims can negatively impact consumer discretionary stocks but might be favorable for defensive sectors like utilities or healthcare. Analyzing the Data Understanding initial jobless claims requires context. Seasonal factors, temporary layoffs, and unique economic events (like a pandemic) can skew data. Analysts often look at the four-week moving average to smooth out weekly volatilities for a clearer trend. Conclusion In conclusion, initial jobless claims serve as a crucial barometer for the economy and financial markets. Investors, policy makers, and economists alike monitor these figures for insights into labor market trends and the broader economic picture. As with any indicator, it's essential to consider jobless claims in conjunction with other data to fully understand the economic landscape.
ECONOMICS:USIJCEducation
by AlgoAlpha
$EURUSD Correction ImminentFX:EURUSD has been navigating sideways since January amid economic challenges, rising interest rates, and Western economic uncertainties. Approaching yearly resistance at 1.10806, a rebound towards 1.05335 support is expected. By the end of the first financial quarter, a breakthrough of yearly resistance is anticipated, solidifying new support. This aligns with expectations of improved global financial conditions and a revival of consumer confidence. #ForexAnalysis #EURUSD #FinancialMarkets #EconomicOutlook #TradingStrategy #MarketTrends #GlobalFinance #CurrencyPairs #YearlyResistance #SupportLevels #ConsumerConfidence #FinanceNews
Short
by wikitrades
2