Date: 20th November 2024.
Market Rebounds as Putin Signals Readiness for Peace Talks; Focus Shifts to NVIDIA!
- US Stocks drop to a 2-week low after Ukraine fired US-made missiles into Russia, but rebound in the US session.
- Putin updates nuclear doctrine, allowing Russia to strike Ukraine if it uses weapons from nuclear-armed nations.
- Walmart again beat earnings expectations pushing the stock 3.00% higher. Earnings Per Share beat expectations by 8.00%.
- The Japanese Yen loses momentum and corrects back to previous lows. The US Dollar maintains strong bullish momentum.
- UK Inflation Rate rises from 1.7% to 2.3% supporting the GBP despite budget concerns continuing.
- NVIDIA is set to release their quarterly earnings report after market close. NVIDIA stock has risen more than 5.00% indicating the market expects a beat.
NASDAQ – All Eyes On NVIDIA Earnings Report!
The NASDAQ ended Tuesday 0.71% higher despite coming under significant pressure during the Asian and European session. The NASDAQ fell 1.20% during the day’s first two sessions due to geopolitical tensions triggering a much lower risk appetite. This is due to the US as well as other countries agreeing to allow Ukraine to strike Russia with foreign made weapons. Ukraine quickly took advantage of this by firing ATACMS into Russia. Russia responded by changing their nuclear weapon use doctrine.
Here we can see why the global stock market fell rapidly. However, why did the market recover during the US session?
During the US session, the risk appetite and confidence of the market improved as the White House confirmed nothing changes with Russia changing their Nuclear Weapons Doctrine. In addition to this, President Putin also said that he would be willing to start peace talks with President Elect Trump. Lastly, the market also took the opportunity to purchase the lower price since NVIDIA’s earnings report is imminent and Walmart already beat their earnings expectations.
Walmart is not a component of the NASDAQ, but has improved the sentiment towards the US stock market. NVIDIA, which is on the NASDAQ, is set to release their quarterly earnings report after market close. NVIDIA stock rose 4.89% yesterday and a further 0.47% this morning indicating the market expects a beat. Analysts expect the company’s Earnings Per Share to rise from $0.68 to $0.75 and revenue from $30.04 billion to $33.14 billion. As no US economic data is set to be made public throughout the day, investors are solely concentrating on geopolitical tensions and earnings.
The price of the NASDAQ rose above the 75-bar exponential moving average on the 2-hour chart for the first time since 14th. Traders will be monitoring whether the index will be able to maintain momentum above this level and if the price may also rise above the 100-bar SMA. Traders will be waiting for the NASDAQ to regain bullish momentum and if so will act accordingly. Buy signals are likely to rise if the price increases above $20,764.30 and intensifies above $20,777.93.
GBPUSD – UK Inflation Rises Above Expectations!
The price of the GBPUSD increased in value taking the exchange rate to a 1-week high, but concerns remain according to analysts. The exchange rate is trading 0.30% higher after the UK made public their latest inflation rate. The UK inflation rate rose from 1.7% to 2.3% which is higher than previous expectations and considerably higher than the previous month.
The GBP is currently the best performing currency with the Pound index trading 0.21% higher. However, the second best performing is the US Dollar Index which is trading 0.14% higher. Therefore, investors need to be cautious that a retrace or correction is still possible while the US Dollar Index remains high.
Currently the Pound is coming under pressure from the Autumn Budget and from farming strikes which are continuing. However, comments from the Bank of England could support the currency. The BoE warns that planned National Insurance hikes in the Labour budget may drive up prices, slow wage growth, and reduce hiring. Significant inflation could force prolonged tight monetary policy.
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.
Please note that times displayed based on local time zone and are from time of writing this report.
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Michalis Efthymiou
HFMarkets
Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
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Date: 21th November 2024.
Gold Regains Momentum as NVIDIA Delivers a Revenue Surge!
- NVIDIA beat earnings expectations, and nearly doubled revenue on an annual basis.
- NVIDIA stocks dip slightly despite strong earnings and a strong forecast for the current quarter. Analysts expect market participants to purchase the dip.
- The Japanese Yen wins back some ground as Bank of Japan Governor indicates the regulator will be willing to hike to support the FX market.
- Gold, Silver and other Metals all rise due to predictions of high retail and institutional demand and geopolitical tensions remaining high.
NASDAQ – NVIDIA Surpasses Earnings Expectations!
The NASDAQ took a sudden dip on Wednesday measuring 1.50%, however, investors quickly took the opportunity to purchase at the lower price as most indicators fell to give an oversold indication. As a result, the NASDAQ ended the day only slightly lower than the open price, but downward momentum remains this morning.
The downward momentum is partially due to geopolitical tensions which are on the rise. Yesterday, Ukraine fired UK-made missiles into Russia and fired US-made the day before. There are also reports and speculations that Russia has sent ICB Missiles into Ukraine for the first time. However, reports are not confirmed, and there are signs of certain stocks recovering.
Currently, there is no economic data which is driving the lack of demand, therefore investors are mainly concentrating on NVIDIA earnings. NVIDIA beat earnings expectations by 8.50% and revenue by 5.90%. Investors were particularly impressed by the significantly higher revenue which has almost doubled annually. In addition to this, the forecast given for the current quarter came in relatively strong. Lastly, the CEO, Jenson Huang, said to Bloomberg that demand exceeds supply but the company is setting in place measures to boost supply in order to meet the high level of demand.
Taking into consideration the strong earnings, positive tone and upbeat forecasts for the coming quarter, many may wonder, “why is the stock declining 2.50% during this morning’s Asian session?”. This is partially due to the lower risk appetite, but also due to certain forecast expectations for NVIDIA not being met. The average NVIDIA forecast expectations from Wall Street firms was $37.1 billion, which NVIDIA comfortably surpassed.
However, certain firms had expectations as high as $41 billion. Based on these higher expectations, the company underachieved and could trigger a lack of demand from this sector of Wall Street. Though many analysts continue to expect shareholders to purchase the lower price as long as the stock market will remain favorable.
EURJPY – BOJ To Consider Hike!
The EURJPY declines for a second consecutive day, particularly gaining bearish momentum after this morning’s Bank of Japan press conference. The main takeaway from the press conference was that the Governor told journalists that the BOJ was willing to hike interest rates in the upcoming months but decisions will be made meeting by meeting.
The Bank of Japan’s decision to raise interest rates in July was influenced in part by the weak Yen, which had driven up import costs and inflation. At the Europlace Financial Forum in Tokyo, Governor Kazuo Ueda emphasized that exchange-rate fluctuations are a key consideration in shaping economic and inflation forecasts. He noted that the central bank carefully examines what is driving these currency changes when assessing their impact.
The EURJPY now trades below the 75-Bar Exponential Moving Average and below the 50.00 on the RSI. In addition to this, the exchange rate continues to form lower swing lows while the Euro underperforms against most currencies. These indications point towards a potential downward price movement.
Gold – Geopolitical Tensions Send Gold on a Bullish Path!
Gold has increased in value for a fourth consecutive day, driven largely by geopolitical tensions. Additionally, the absence of significant US economic news has left markets uncertain about the Federal Reserve’s next move. Gold is currently witnessing an active buy signal from most momentum-based indicators due to the strong bullish momentum.
For example, traders are able to see the price trading above the Bollinger Band, within a bullish moving average crossover and significantly high on most oscilators. However, investors should note as the price increases, the asset can become overbought and this may trigger a retracement, a correction or sideways price movement.
In terms of geopolitical tensions, hopes for a Middle East ceasefire are being tempered by Russia’s revision of its nuclear doctrine, which aims to strengthen its borders after the US-approved long-range strikes from Ukraine reached deep into Russian territory. Meanwhile, Donald Trump’s re-election has yet to significantly influence the conflict, though markets remain optimistic about potential positive developments following his January 20 inauguration.
Always trade with strict risk management. Your capital is the single most important aspect of your trading business.
Please note that times displayed based on local time zone and are from time of writing this report.
Click
HERE to access the full HFM Economic calendar.
Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work. Click
HERE to register for FREE!
Click HERE to READ more Market news.
Michalis Efthymiou
HFMarkets
Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
