Factory orders rose 8.9% in December vs expected 0.1% decline, a rare positive for Germany that the euro chose to ignore. This is the most robust monthly increase since mid-2020’s lockdowns.
In the same month last year, the increase was 2.7%. A positive year-over-year rate has been a rarity over the past two years, as a couple of spikes did not break the overall downtrend. Traders in European markets are likely looking for such an anomaly and ignoring today's upbeat data.
However, we may be seeing the result of a relatively long period of low gas prices, the effects of China's stimulus and the economy's adaptation to inflation shock.
If orders continue to rise next month, it promises to be a turnaround at a time when it seems that only the lazy have failed to talk about the deindustrialisation of the eurozone's largest economy.
We will also be looking at German industrial production figures on Wednesday - will there be similarly strong growth? If so, markets may have rushed to bury the euro.
In the same month last year, the increase was 2.7%. A positive year-over-year rate has been a rarity over the past two years, as a couple of spikes did not break the overall downtrend. Traders in European markets are likely looking for such an anomaly and ignoring today's upbeat data.
However, we may be seeing the result of a relatively long period of low gas prices, the effects of China's stimulus and the economy's adaptation to inflation shock.
If orders continue to rise next month, it promises to be a turnaround at a time when it seems that only the lazy have failed to talk about the deindustrialisation of the eurozone's largest economy.
We will also be looking at German industrial production figures on Wednesday - will there be similarly strong growth? If so, markets may have rushed to bury the euro.
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#WaveAnalysis
#AUDCHF reversed from key support level 0.5620
Likely to rise to resistance level 0.5730
AUDCHF currency pair recently reversed up from the key support level 0.5620, which has been reversing the pair from the middle of August , stopping earlier waves (5),(1) and 1.
The support level 0.5620 was strengthened by the lower daily Bollinger Band – which started the active wave ii.
Given the strength of the support level 0.5620, AUDCHF currency pair can be expected to rise further to the next resistance level 0.5730, top of the previous correction 2.
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#AUDCHF reversed from key support level 0.5620
Likely to rise to resistance level 0.5730
AUDCHF currency pair recently reversed up from the key support level 0.5620, which has been reversing the pair from the middle of August , stopping earlier waves (5),(1) and 1.
The support level 0.5620 was strengthened by the lower daily Bollinger Band – which started the active wave ii.
Given the strength of the support level 0.5620, AUDCHF currency pair can be expected to rise further to the next resistance level 0.5730, top of the previous correction 2.
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#WaveAnalysis #AAPL
#Apple reversed from support level 180.00
Likely to rise to resistance level 197.45
Apple recently reversed up from the strong support level 180.00, which stopped waves A and (b) of the previous ABC correction (2) from the middle of December.
The support level 180.00 was strengthened by the lower daily Bollinger Band and by the 50% Fibonacci correction of the sharp upward impulse wave (1) from October.
Given the clear daily uptrend, Apple can be expected to rise further to the next resistance level 197.45, previous monthly high from July, December and January.
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#Apple reversed from support level 180.00
Likely to rise to resistance level 197.45
Apple recently reversed up from the strong support level 180.00, which stopped waves A and (b) of the previous ABC correction (2) from the middle of December.
The support level 180.00 was strengthened by the lower daily Bollinger Band and by the 50% Fibonacci correction of the sharp upward impulse wave (1) from October.
Given the clear daily uptrend, Apple can be expected to rise further to the next resistance level 197.45, previous monthly high from July, December and January.
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The #crypto market cap remained at $1.65 trillion. Bitcoin spent another day almost unchanged at $42.8K.
#Ethereum was a major growth driver, gaining 1.6% on the day to $2,350 and reversing to the downside as it approached $2,400. This is the same place where we saw a reversal at the end of January and for a month since the beginning of December.
In December, the coin managed to hold above this reversal level for almost a fortnight, but with the current lull in the markets, a temporary pullback to the lower end of the range towards $2,200 looks more likely.
With a loss of 6% over the last seven days, #Solana has moved slightly below its 50-day moving average, raising the question of the sustainability of the recent rally. However, the fall to $85 will be within the correction pattern after the September-December rally.
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#Ethereum was a major growth driver, gaining 1.6% on the day to $2,350 and reversing to the downside as it approached $2,400. This is the same place where we saw a reversal at the end of January and for a month since the beginning of December.
In December, the coin managed to hold above this reversal level for almost a fortnight, but with the current lull in the markets, a temporary pullback to the lower end of the range towards $2,200 looks more likely.
With a loss of 6% over the last seven days, #Solana has moved slightly below its 50-day moving average, raising the question of the sustainability of the recent rally. However, the fall to $85 will be within the correction pattern after the September-December rally.
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The euro is back at 0.8520 against the pound. The pair bounced off this level in June and August last year. Reaching the same level in late January triggered a shake-out, but active declines resumed on Tuesday and Wednesday, and the pair is testing multi-month lows with renewed vigour.
Technically, a break of support at 0.8500 would allow a move towards 0.8250-0.8300 to be considered as a working scenario. A decline of 2.0-2.5% looks like a significant move. However, we may be seeing the beginning of a new global trend.
EURGBP has tried to break above 0.9200 several times since 2016, mainly triggered by the weakness of the pound. We may now be entering a period of euro weakness, like what we saw in 2013-2015. Back then, a wave of pressure on the euro pushed EURGBP towards 0.7000.
Technically, a break of support at 0.8500 would allow a move towards 0.8250-0.8300 to be considered as a working scenario. A decline of 2.0-2.5% looks like a significant move. However, we may be seeing the beginning of a new global trend.
EURGBP has tried to break above 0.9200 several times since 2016, mainly triggered by the weakness of the pound. We may now be entering a period of euro weakness, like what we saw in 2013-2015. Back then, a wave of pressure on the euro pushed EURGBP towards 0.7000.
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The reason for this global reshuffle in a rather dull pair could be the increasing divergence in economic dynamics. With interest rate changes on the agenda, interest is being drawn to the more buoyant economies where the UK has an advantage due to domestic demand.
The level of interest rates and interest rate expectations will also be critical in the coming quarters. The Bank of England's base rate is now 5.25%, compared with 4.5% for the ECB. However, markets expect the Bank of England to cut four times to 4.25% by 2024. The ECB is expected to start its rate-cutting cycle a little earlier and bigger.
While one should be prepared for the EURGBP to return to a lower floor, confirmation in the form of a break of 0.8500 is still needed and is not yet a done deal. There is still a relatively high chance of renewed gains from current levels, as the current multi-month lows may attract buyers into the EUR.
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The level of interest rates and interest rate expectations will also be critical in the coming quarters. The Bank of England's base rate is now 5.25%, compared with 4.5% for the ECB. However, markets expect the Bank of England to cut four times to 4.25% by 2024. The ECB is expected to start its rate-cutting cycle a little earlier and bigger.
While one should be prepared for the EURGBP to return to a lower floor, confirmation in the form of a break of 0.8500 is still needed and is not yet a done deal. There is still a relatively high chance of renewed gains from current levels, as the current multi-month lows may attract buyers into the EUR.
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S&P500’s 5000 may be a long-time milestone
S&P500 futures hit an all-time high of 4990 at the start of the active US session. The index is within reach of the significant round figure of 5000, and there is little doubt that this level will be breached. A much more interesting question is how sustainable this rally will be. And there are a couple of things to look out for.
Firstly, the Nasdaq100 and S&P500 indices are hitting new highs despite the news of regional bank problems. But investors are turning a blind eye, focusing on the success of IT giants and getting the most out of their rallies. There are also early signs of a domino effect, with German bank bonds falling on news of exposure to US commercial property. These are too worrying signs of a repeat of 2008 to ignore.
S&P500 futures hit an all-time high of 4990 at the start of the active US session. The index is within reach of the significant round figure of 5000, and there is little doubt that this level will be breached. A much more interesting question is how sustainable this rally will be. And there are a couple of things to look out for.
Firstly, the Nasdaq100 and S&P500 indices are hitting new highs despite the news of regional bank problems. But investors are turning a blind eye, focusing on the success of IT giants and getting the most out of their rallies. There are also early signs of a domino effect, with German bank bonds falling on news of exposure to US commercial property. These are too worrying signs of a repeat of 2008 to ignore.
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Secondly, Wednesday's rally in the major US indices coincides with selling in China and Europe. Tuesday saw a reversal of momentum with impressive gains in China's indices and highs in the DAX40 and Stoxx50, while the S&P500 was flat and the Nasdaq100 under pressure. Speculators appear to be moving quickly from one security to another, although it is common for equity markets to be synchronised in such trends.
Markets are most synchronised during periods of maximum fear when risk assets are sold off across sectors and classes. It would be prudent to maintain a maximum level of caution and vigilance over the coming days.
Markets are most synchronised during periods of maximum fear when risk assets are sold off across sectors and classes. It would be prudent to maintain a maximum level of caution and vigilance over the coming days.
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#WaveAnalysis #NDX
Nasdaq-100 rising inside impulse wave 5
– Likely to rise to resistance level 18000.00
Nasdaq-100 index rising steadily after the price reversed up from the support level 17565.00, former resistance which stopped wave 3 in January.
The upward reversal from the support level 17565.00 continues the active impulse wave 5 of the intermediate impulse sequence (3) from the start of the year.
Given the clear daily uptrend, Nasdaq-100 index can be expected to rise further to the next resistance level 18000.00, target for the completion of the active impulse wave 5.
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Nasdaq-100 rising inside impulse wave 5
– Likely to rise to resistance level 18000.00
Nasdaq-100 index rising steadily after the price reversed up from the support level 17565.00, former resistance which stopped wave 3 in January.
The upward reversal from the support level 17565.00 continues the active impulse wave 5 of the intermediate impulse sequence (3) from the start of the year.
Given the clear daily uptrend, Nasdaq-100 index can be expected to rise further to the next resistance level 18000.00, target for the completion of the active impulse wave 5.
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#WaveAnalysis
#USDCAD reversed from resistance level 1.3530
Likely to fall to support level 1.3365
USDCAD currency pair recently reversed down from the resistance level 1.3530, which stopped waves 1 and (b) in the middle of January.
The resistance level 1.3530 was strengthened by the upper daily Bollinger Band and by the 50% Fibonacci correction of downward ABC correction (2) from October.
Given the strength of the resistance level 1.3530, USDCAD can be expected to fall further to the next support level 1.3365, low of the previous correction 2.
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#USDCAD reversed from resistance level 1.3530
Likely to fall to support level 1.3365
USDCAD currency pair recently reversed down from the resistance level 1.3530, which stopped waves 1 and (b) in the middle of January.
The resistance level 1.3530 was strengthened by the upper daily Bollinger Band and by the 50% Fibonacci correction of downward ABC correction (2) from October.
Given the strength of the resistance level 1.3530, USDCAD can be expected to fall further to the next support level 1.3365, low of the previous correction 2.
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The #crypto market made an impressive move higher, rising 3.4% in 24 hours to $1.71 trillion. The rise to its highest level since 12 January came as the S&P500 and Nasdaq-100 indices hit all-time highs.
#Bitcoin rose above its 50-day moving average, confirming the bullish medium-term trend and easing fears of a deeper correction. On a weekly basis, bitcoin is now above its December-January closing levels, although intra-week volatility briefly pushed the price higher earlier in the year. However, weekly closes are the more important benchmark for the markets.
Technically, bitcoin and the broader crypto market have gained strength after a long period of consolidation and are now poised to make new highs. The Fibonacci pattern is almost perfect: the rally from $25K to $49K ended with a 61.8% retracement of the initial move. Theoretically, a break of the highs at $49K would confirm the pattern and make $64K (161.8%) a target.
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#Bitcoin rose above its 50-day moving average, confirming the bullish medium-term trend and easing fears of a deeper correction. On a weekly basis, bitcoin is now above its December-January closing levels, although intra-week volatility briefly pushed the price higher earlier in the year. However, weekly closes are the more important benchmark for the markets.
Technically, bitcoin and the broader crypto market have gained strength after a long period of consolidation and are now poised to make new highs. The Fibonacci pattern is almost perfect: the rally from $25K to $49K ended with a 61.8% retracement of the initial move. Theoretically, a break of the highs at $49K would confirm the pattern and make $64K (161.8%) a target.
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Inflation in China remains below expectations, adding to investor concerns about the world's second-largest economy. The consumer price index for January was 0.8% lower than a year earlier, more than the 0.3% drop in December and the 0.5% expected. Recall that the last peak in China's consumer inflation was in July 2022, as in many Western countries, but it was a more modest 2.7% year-on-year.
For the past six months, China has been experiencing a year-on-year decline in prices. This is interpreted as a manifestation of subdued consumer demand and oversupply in the market. Problems in the real estate sector are also suspected, as they weigh on consumer sentiment.
The producer price index was 2.5% lower in January than a year earlier. This index has been in negative territory since October 2022, and in this case, it could be said that China is once again spreading deflation around the world, something it has been blamed for over the past decade. But that doesn't seem to be hurting the world now.
For the past six months, China has been experiencing a year-on-year decline in prices. This is interpreted as a manifestation of subdued consumer demand and oversupply in the market. Problems in the real estate sector are also suspected, as they weigh on consumer sentiment.
The producer price index was 2.5% lower in January than a year earlier. This index has been in negative territory since October 2022, and in this case, it could be said that China is once again spreading deflation around the world, something it has been blamed for over the past decade. But that doesn't seem to be hurting the world now.
#WaveAnalysis
#EURGBP reversed from support level 0.8515
Likely to rise to resistance level 0.8600
EURGBP currency pair recently reversed up from the support level 0.8515, which has been reversing the price from the middle of 2023.
The support level 0.8515 was strengthened by the lower weekly Bollinger Band and by the lower daily Bollinger Band.
Given the oversold weekly Stochastic and the strength of the nearby support level 0.8515, EURGBP currency pair can be expected to rise further to the next resistance level 0.8600.
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#EURGBP reversed from support level 0.8515
Likely to rise to resistance level 0.8600
EURGBP currency pair recently reversed up from the support level 0.8515, which has been reversing the price from the middle of 2023.
The support level 0.8515 was strengthened by the lower weekly Bollinger Band and by the lower daily Bollinger Band.
Given the oversold weekly Stochastic and the strength of the nearby support level 0.8515, EURGBP currency pair can be expected to rise further to the next resistance level 0.8600.
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#WaveAnalysis #BABA
Alibaba Group falling inside impulse wave 5
Likely to fall to support level 66.80
Alibaba Group falling strongly inside the minor impulse wave 5, which started earlier from the key resistance level 77.70 (which stopped wave a in December).
The resistance level 77.70 was strengthened by the upper daily Bollinger Band, resistance trendline of the daily down channel from July and by the upper daily Bollinger Band.
Given the clear daily downtrend, Alibaba Group can be expected to fall further to the next support level 66.80 (former monthly low from January).
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Alibaba Group falling inside impulse wave 5
Likely to fall to support level 66.80
Alibaba Group falling strongly inside the minor impulse wave 5, which started earlier from the key resistance level 77.70 (which stopped wave a in December).
The resistance level 77.70 was strengthened by the upper daily Bollinger Band, resistance trendline of the daily down channel from July and by the upper daily Bollinger Band.
Given the clear daily downtrend, Alibaba Group can be expected to fall further to the next support level 66.80 (former monthly low from January).
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The #crypto market capitalisation has hit new highs since 12th January, passing the $1.75 trillion mark. The market has confidently moved into a state of greed, which we also last saw a month ago. Last month's corrective pullback and early February's consolidation have helped gather strength for a real breakout.
#Bitcoin has gained almost 10% in the last four days to trade at $46.2K. All eyes are now on whether BTCUSD can break above the previous highs from which it pulled back shortly after the initial reaction to the launch of spot ETFs.
Technically, a growth above the $49K level would set the stage for a test of the all-time highs soon. This will be an exciting development, as it has previously occurred after a halving rather than in anticipation of one.
The influx of capital into the equity markets helped to push Bitcoin up to $46K. According to IntoTheBlock, the correlation between Bitcoin and the S&P 500 index was negative at the end of January but is now rising again.
#Bitcoin has gained almost 10% in the last four days to trade at $46.2K. All eyes are now on whether BTCUSD can break above the previous highs from which it pulled back shortly after the initial reaction to the launch of spot ETFs.
Technically, a growth above the $49K level would set the stage for a test of the all-time highs soon. This will be an exciting development, as it has previously occurred after a halving rather than in anticipation of one.
The influx of capital into the equity markets helped to push Bitcoin up to $46K. According to IntoTheBlock, the correlation between Bitcoin and the S&P 500 index was negative at the end of January but is now rising again.
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#Copper exchange prices on Thursday fell to their lowest since November, approaching $8200 a tonne and breaking out of the broad consolidation range of the past two months.
A move out of the $8250-8700 range technically leaves copper vulnerable to a quick fall into the $7900 region, where the lows of November 2022 and May and October 2023 are centred. The Relative Strength Index (RSI) is temporarily on the bears' side as it has recorded three consecutive declining local peaks at relatively similar highs over the past two months.
Earlier in the week, the price dipped under its 200-day moving average, and the sell-off has only gained momentum since then.
Copper has sold off almost every trading session since the end of last month, losing around 6% in that time. The selloffs at the start of December and January were almost as persistent but had less amplitude.
A move out of the $8250-8700 range technically leaves copper vulnerable to a quick fall into the $7900 region, where the lows of November 2022 and May and October 2023 are centred. The Relative Strength Index (RSI) is temporarily on the bears' side as it has recorded three consecutive declining local peaks at relatively similar highs over the past two months.
Earlier in the week, the price dipped under its 200-day moving average, and the sell-off has only gained momentum since then.
Copper has sold off almost every trading session since the end of last month, losing around 6% in that time. The selloffs at the start of December and January were almost as persistent but had less amplitude.
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Copper broke above a vital downtrend resistance level in November and is now set to test its strength as support. By the end of February, it will be just around $7900, which will further strengthen interest in testing this line.
Copper dynamics are essential not only for traders who hold it but also as a manifestation of global production dynamics. This is a signal of slowing global production despite the optimism of stock markets, where global, US, and European indices are storming new highs.
Further declines in the price of copper could attract more bears to global markets. Markets are receiving a similar bearish signal from the global economy in the form of falling natural gas prices. The price of US futures has fallen into the 2020 bottom area.
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Copper dynamics are essential not only for traders who hold it but also as a manifestation of global production dynamics. This is a signal of slowing global production despite the optimism of stock markets, where global, US, and European indices are storming new highs.
Further declines in the price of copper could attract more bears to global markets. Markets are receiving a similar bearish signal from the global economy in the form of falling natural gas prices. The price of US futures has fallen into the 2020 bottom area.
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CAD rallied on the release of January's jobs data. But it will be difficult to sustain the gains if we focus only on the data released.
According to StatCan, employment grew by 37.3K last month, vs. the expected 16K. The unemployment rate fell from 5.8% to 5.7% instead of the expected rise to 5.9%.
However, it is worth digging a little deeper into the figures to find a more worrying picture. A surge in part-time employment contributed to the overall increase. In January, there was an increase of 48.9K, after a rise of 14.4K in the previous month. At the same time, full-time employment fell in both December (-7.5K) and January (-11.6K). The shift of the labour force into part-time employment seems to be a sign of employers' caution.
The fall in the unemployment rate is a consequence of the share of the economically active population falling from 65.4% to 65.3%. This is the lowest level since September 2022. Except for the pandemic, labour market participation has not been this low since the end of 1999.
According to StatCan, employment grew by 37.3K last month, vs. the expected 16K. The unemployment rate fell from 5.8% to 5.7% instead of the expected rise to 5.9%.
However, it is worth digging a little deeper into the figures to find a more worrying picture. A surge in part-time employment contributed to the overall increase. In January, there was an increase of 48.9K, after a rise of 14.4K in the previous month. At the same time, full-time employment fell in both December (-7.5K) and January (-11.6K). The shift of the labour force into part-time employment seems to be a sign of employers' caution.
The fall in the unemployment rate is a consequence of the share of the economically active population falling from 65.4% to 65.3%. This is the lowest level since September 2022. Except for the pandemic, labour market participation has not been this low since the end of 1999.
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The crypto market reached a capitalisation of $1.82 trillion in the early hours of trading on Monday. By the early European session, it had corrected to $1.8 trillion, but this is still more than 10% above the levels of a week earlier.
#Bitcoin remains the most crucial growth driver, adding 12% in 7 days against about 8% for Ethereum, Solana, and Cardano - important drivers of the current cycle. Bitcoin now accounts for 52.6% of the entire crypto market, adding more than ten percentage points over the year and 1.5p. p. over the month.
Bitcoin posted its seventh consecutive day of gains, but the strengthening slowed over the weekend. It also coincided with a move above 70 on the RSI on the daily timeframes, which could increase players' appetite for short-term profit-taking. Caution is also building as we approach the January peak. Bulls have clearly become more cautious, closing the week at the highest since December 2021.
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#Bitcoin remains the most crucial growth driver, adding 12% in 7 days against about 8% for Ethereum, Solana, and Cardano - important drivers of the current cycle. Bitcoin now accounts for 52.6% of the entire crypto market, adding more than ten percentage points over the year and 1.5p. p. over the month.
Bitcoin posted its seventh consecutive day of gains, but the strengthening slowed over the weekend. It also coincided with a move above 70 on the RSI on the daily timeframes, which could increase players' appetite for short-term profit-taking. Caution is also building as we approach the January peak. Bulls have clearly become more cautious, closing the week at the highest since December 2021.
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