After the busy week that just passed, it seems that this week offers investors and traders a chance to take a break. The weekly report covers the FOMC meeting, NFP data, and Powell’s statements, with a greater emphasis on identifying optimal entry points into the market.
Economic Events:
Today’s high-impact event on the calendar was related to Australia, with the interest rate decision remaining unchanged at around 4.35 percent. However, perhaps the most significant event today is the speech by Kashkari, a member of the Federal Reserve. Similar to Powell and Williams, Kashkari is a Federal Reserve moderate, aligning with the “Higher for longer” policy trend.
Source: Dailyfx
Earnings:
U.S. stock futures stabilized on Tuesday as investors awaited comments from Federal Reserve officials and continued to monitor the quarterly earnings season.
Walt Disney shares dropped 5.3% despite the entertainment giant reporting its first profit from its streaming unit, which came two quarters ahead of schedule. The company also raised its annual earnings per share outlook, attributing it to the success of its turnaround efforts.
Apple shares gained 0.8% following a report by the Wall Street Journal that the tech giant is working on its own chip for running artificial intelligence software in data centers, according to sources familiar with the matter.
Boeing shares declined 0.9% after the Federal Aviation Administration launched an investigation into the aerospace manufacturer’s 787 Dreamliner. This comes after Boeing disclosed that some employees had engaged in “misconduct” by falsely claiming that certain tests had been completed.
AAPL:
DIS:
Gold (XAUUSD):
Gold, considering Tuesday’s momentum, experienced rejection after hitting the Point of Control (POC). A fair price of $2333 can be seen as a solid barrier against price hikes. Now, considering the likelihood of a bullish dollar valuation, gold might still face a decline again due to real interest rates and market expectations.
US100:
On Tuesday, the tech-heavy Nasdaq 100 futures experienced a dip, with many megacap and technology companies facing pressure following updates from Apple (NASDAQ: AAPL) and Tesla (NASDAQ: TSLA).
Investors will also be monitoring Minneapolis Fed President Neel Kashkari’s speech later in the day. Richmond Fed President Thomas Barkin mentioned on Monday that ending the fight against inflation might necessitate a decrease in demand, while New York Fed President John Williams stated that, at some unspecified point, the U.S. central bank will reduce its interest rate target.
Foreign Exchange Market (FOREX):
On Tuesday, Masato Kanda, the top currency diplomat for the Japanese government, emphasized the possibility of taking action against disorderly and speculative-driven foreign exchange movements. This statement underscores Tokyo’s readiness to intervene once again to stabilize the yen, which is currently fragile.
In a clear indication of authorities’ concern regarding recent declines in the yen’s value, Bank of Japan Governor Kazuo Ueda mentioned that currency movements were among the topics discussed during a meeting with Prime Minister Fumio Kishida on Tuesday.
As Japan’s vice minister of finance for international affairs and overseer of the country’s currency policy, Kanda stated that government intervention would not be necessary if exchange rates reflect steady movements in line with fundamentals.
Bitcoin (BTC):
On Tuesday, the price of Bitcoin experienced a slight drop as sentiment toward cryptocurrencies continued to be weighed down by regulatory concerns, coupled with ongoing outflows from investment products, particularly exchange-traded funds (ETFs).
The world’s largest cryptocurrency saw a 0.2% decline over the past 24 hours, settling at $63,579.
This week, sentiment in crypto markets took a hit following a report indicating that less than 10% of overall stablecoin transactions, which are crucial for crypto transactions, were organic or from real users. This raised doubts about the actual retail demand for crypto, especially considering the consistent increases in market capitalization seen by stablecoin operators like Tether.
Furthermore, trading app Robinhood Markets Inc revealed potential regulatory action from the Securities and Exchange Commission (SEC) over crypto tokens traded on its platform. The SEC also delayed a key decision regarding ETFs.
These negative developments coincided with continued outflows from crypto investment products, indicating prevailing negative sentiment in the space.
According to data from digital asset manager CoinShares, crypto investment products witnessed a third consecutive week of sustained capital outflows, totaling $435 million, with Bitcoin products accounting for $423 million of those outflows.
While outflows from Grayscale’s Bitcoin ETF remained significant, inflows into other Bitcoin ETFs slowed considerably.
These weakening flows occurred amid a lack of immediate catalysts for crypto markets, following Bitcoin’s halving event which passed without much excitement. The cryptocurrency remained largely rangebound after reaching record highs in March.
US Crude Oil WTI :
On Tuesday, oil prices stabilized despite concerns about escalating conflict in the Middle East, particularly as Israel intensified its attacks in southern Gaza. The delicate situation arose as Israel seized control of the Rafah border crossing between the Gaza Strip and Egypt. Israeli tanks also advanced into the southern Gazan town of Rafah. Meanwhile, efforts by mediators to broker a ceasefire agreement faced challenges.
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