Pre-Open US

[Zforex]

US Indices

Stocks climbed higher on Tuesday as investors built upon the previous session's historic surge to record highs. The continued strength of Wall Street hinges on whether the U.S. Federal Reserve can successfully achieve a soft landing—cooling the economy enough to reduce inflation without triggering a recession. Currently, traders are estimating about a 40% likelihood of a Fed rate cut in March, a significant drop from nearly 81% just a week earlier, as indicated by FedWatch Tool.
Investors are attentively monitoring a series of economic reports scheduled for release this week. These include the fourth-quarter gross domestic product (GDP) figures on Thursday and the Fed’s preferred inflation measure, the personal consumption expenditures (PCE) price index for December, due on Friday. Both reports will play a crucial role in shaping the Fed's perspective on future monetary policy.
The focus is also on the profit outlook for corporate America, following the commencement of the ongoing earnings season by major U.S. banks. So far, the results have been mixed, with several reports of lower profits.
The Nasdaq, along with other major indices, is experiencing an uptick, with the Nasdaq reaching a new resistance level at the Fibonacci 0.618 retracement, where the rally continues. My projection is for a higher target price, particularly in light of this quarter's earnings. The performance of the 'magnificent seven' and other economic data may further propel the Nasdaq upwards.




Crypto

Bitcoin's value continues to plummet, sinking below the $39K mark amidst ongoing bearish trends. After dipping below the $40K barrier on Monday, the leading cryptocurrency has seen a further 5.3% depreciation against the U.S. dollar within the last 24 hours.
This downward trend has led to speculations in the market, with concerns revolving around Grayscale's GBTC outflows and the impact of spot bitcoin exchange-traded funds (ETFs). Additionally, the approval of bitcoin spot ETFs appears to be a "sell the news" event, with the cryptocurrency's price dropping 20% since the ETFs launched on January 11th, resulting in long-term holders capitalizing on profits.
bitcoin's rapid price growth of over 90% in less than a year may have triggered massive sales, while miners might also be contributing to the downward pressure. Miners could be selling their bitcoins ahead of the April 2024 Halving event, which reduces mining rewards, leading to oversupply and a potential price decline.
JPM says it finds spot Bitcoin ETFs flows-to-date as "underwhelming versus the lofty expectations" established in the run-up to their approval.
Bitcoin is falling toward the median line at the support level of 3800 Which may continue toward 35000.

 

[Zforex]

EUR/USD Volatility Follows PMI Data
The EUR/USD had strong volatility yesterday after PMI data while still hovering around the support at the 200MA and the 1.0850, waiting for today's GDP data for direction. The next support is at the 1.0800 level and the next resistance is at 1.0900.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.1100	1.1000	1.0900	1.0850	1.0800	1.0750

GBP/USD Stalls in Price Range with Growing Uncertainty
The GBP/USD is experiencing range-bound movements due to increasing uncertainty at the start of the new year. The next resistance if the rebound continues is at 1.2800 while the 50MA will be the next support.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
1.3100	1.2930	1.2800	1.2600	1.2500	1.2400

USD/JPY Dependent on Dollar Movements
The USD/JPY pair is making some corrections but limited as it will depend on US dollar movements for today. The next support is at 146.50. If a breakout occurs, the next target is 150.00.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
152.00	150.00	148.35	146.50	144.80	144.00

Gold Slips Following US PMI Data
Gold is falling today after yesterday's US PMI data where markets believe US economic resilience and rates will be held for longer. The short-term bearish trend is still active. If it continues to decrease, the next level will be at 2006 again.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
2070	2052	2021	2006	1979	1960

Crude Oil Initiates Reversal, Next Resistance at 78

Recent market trends indicate a potential reversal in oil prices, with the commodity poised for an upward movement. The next significant resistance level stands near the 200-day moving average, hovering around 78 and the support level remains steady at 70.

Resistance 3	Resistance 2	Resistance 1	Support 1	Support 2	Support 3
81	78	74	70	68	64.9

 

[Zforex]

US Indices

S&P 500 and Nasdaq 100 futures have seen a modest increase. Last week, all three major averages witnessed gains, buoyed by promising economic data. The fourth quarter showed stronger economic growth than anticipated, while core inflation on an annual basis was below economist forecasts, indicating a potential easing in price hikes. However, these market gains were somewhat subdued in comparison to the previous week's rally, partly due to disappointing earnings reports from major companies like Intel and Tesla.
As the fourth-quarter earnings season progresses, investors are keenly awaiting new reports from leading global corporations this week. Key players such as Microsoft, Alphabet, Apple, Amazon.com, Meta Platforms, and Advanced Micro Devices are set to release their financial results.
In addition to corporate earnings, market focus is also on the Federal Reserve's policy stance. The Federal Open Market Committee is scheduled to start its two-day policy meeting on Tuesday, with investors largely expecting the central bank to maintain steady interest rates.
The Nasdaq experienced a slight decline due to the disappointment caused by Intel and Tesla. However, the overall outlook remains bullish and the momentum is strong. This week, corporate earnings, particularly from the big caps, will have a significant impact on and determine the direction of the Nasdaq.

Crypto

The recent surge in Bitcoin's price can be attributed to a decrease in open interest in options at specific strike prices. The largest open interest in Bitcoin options is currently at a strike price of $50,000, indicating a bullish sentiment among traders. The reduction in open interest at the $40,000 level may have contributed to Bitcoin's recent price increase. This reduction suggests that there is less supply from hedgers who had options to lean against the $40,000 price level.

After the expiration of end-of-month options on January 26, there was a notable decrease in open interest for short-dated Bitcoin derivatives, especially options. This contrasts with the situation before the previous Friday's options expiry when there was an excess of local gamma, potentially limiting the price of Bitcoin after a sharp correction.
The total open interest of Bitcoin options across major centralized derivatives exchanges reached over $13 billion before the last Friday's expiry but dropped to $9.88 billion after the expiry date.
The presence of a significant number of call options at the $50,000 strike price suggests that many traders are anticipating Bitcoin's price to rise above this level.
Contrary to some predictions, Bitcoin has held above the $42,000 mark in the past 24 hours, defying expectations of a price correction. Market observers had forecasted a price correction to around $33,600, but this has not materialized so far.
Bitcoin found support at the median line as expected and now waiting for a rebound or a breakout to the next level at 35000.

 

[Zforex]

US Indices

US Stock Futures Steady During Earnings Week, Rate Cut Expectation Shifts
US stock futures were mostly unchanged to lower on Monday as the market prepares for a significant week of corporate earnings while the realization takes hold that rate cuts may not come as soon as previously expected. Treasury yields rose on the back of relatively hawkish comments from Federal Reserve Chairman Jerome Powell, with investors also awaiting further corporate earnings reports and speeches from other Federal Reserve officials.
In the last trading session on Friday, Wall Street's major indices closed higher, with the S&P 500, Dow Jones Industrial Average, and Nasdaq 100 all reaching new record highs. Meta Platforms surged over 20%, leading gains in both the S&P 500 and Nasdaq 100 after it reported fourth-quarter results that exceeded expectations and provided first-quarter revenue guidance above consensus estimates. Amazon also rose more than 7% following upbeat fourth-quarter results from the Seattle-based e-commerce leader.
Attention is now turned towards the upcoming US ISM Non-Manufacturing PMI data set to be released shortly. The Nasdaq and other major indices continue to break new records, maintaining strong momentum. The next target for the bullish long-term channel appears to be near 18,000, with 17,200 acting as the current support level.

Crypto

Bitcoin's Price Dynamics with Anticipated Fed Rate Cuts
The crypto market could see potential benefits from anticipated Federal Reserve rate cuts in May. Bitcoin experienced a slight increase, surpassing the $43,000 mark as markets expect the start of the rate-cutting cycle in May, during the Federal Open Market Committee (FOMC) meeting. This expectation is based on current pricing in Fed funds futures contracts, which reflect the market's outlook on future interest rates.
Federal Reserve Chair Jerome Powell ruled out an earlier rate cut in March, explaining that they need to be more confident about inflation moving down to 2%. However, the analyst suggests that higher interest rates and recent US job data could increase the likelihood of an earlier rate cut due to potential systemic risks in the banking system and rising unemployment rates, particularly affecting regional banks with significant exposure to US commercial real estate.
Regarding the crypto market's reaction, it's expected that cryptocurrencies, including Bitcoin, may initially experience a sell-off due to the potential delay in the rate cut until May, driven by declining global growth expectations and concerns about a US recession. However, the reversal in monetary policy in May, combined with a weak US dollar, could provide a significant boost as a second-order effect.
After rebounding from the 100-day moving average and targeting the yearly high of $48,000, Bitcoin encountered resistance at $43,578. This resistance could potentially trigger a pullback towards the 100-day moving average. However, if it successfully overcomes this barrier, the price could surge past $48,000. The price movements signal uncertainty after reaching $48,000, and only a clear breakout can pave the way for further advancement toward the next significant target in the $52,000 area.

 

[Zforex]

US Indices

Stocks are riding high from a victorious session that nudged the S&P 500 close to the 5,000 mark, fueled by robust earnings reports and sustained momentum in the technology sector. The fourth-quarter earnings season has exceeded expectations, bolstering investor confidence in the economy's capacity to sustain corporate profitability.
Walt Disney saw its shares leap over 6% in pre-market trading following a report of stronger-than-anticipated Q1 earnings. The company not only increased its cash dividend by 50% but also projected a positive profit outlook for the year. Similarly, chipmaker and designer Arm experienced a significant surge, nearly 30%, after announcing earnings and profit forecasts that surpassed expectations.
In the realm of Big Tech, Meta Platforms enjoyed a 3% increase on Wednesday, while Nvidia and Microsoft each climbed about 2%, reaching new all-time highs.
Attention is also turning towards economic indicators, with U.S. Initial Jobless Claims data eagerly anticipated. Economists predict Initial Jobless Claims to be around 221K, slightly below last week’s figure of 224K.
The Nasdaq, along with other major U.S. indices, continues to achieve new historical highs, with strong momentum that is expected to persist given the current sentiment and appetite for risk. Looking ahead, the market's bullish trend suggests a long-term target near 18,000, with 17,200 identified as a key support level, underscoring the optimism surrounding future market performance.



Crypto

Bitcoin has surged past $44,000 for the first time since the approval of Spot Bitcoin ETFs in January, driven by various bullish factors. Notably, Bitcoin whales have been on an accumulation spree, with data from Glassnode indicating a 3.66% increase in addresses holding 1,000 BTC or more over the last two weeks. This accumulation trend follows a buying frenzy after Bitcoin's dip below $40,000, partly attributed to selling pressure from Grayscale, the GBTC Spot Bitcoin ETF issuer. However, Grayscale has recently reduced its BTC sell-offs, contributing to Bitcoin's price recovery. Moreover, institutional demand for Bitcoin has spiked, thanks to Spot Bitcoin ETFs, with asset managers like BlackRock significantly increasing their Bitcoin holdings. The success of these funds is highlighted by their collective possession of over 657,000 BTC, accounting for more than 3% of Bitcoin's circulating supply. Additionally, the anticipation of Spot Bitcoin ETFs in Hong Kong and Thailand's recent removal of VAT on crypto trading further bolster Bitcoin's bullish outlook. Currently, Bitcoin is trading at approximately $44,800, marking a 4.4% increase in the last 24 hours, as per CoinMarketCap data.
Bitcoin's price is regaining its bullish momentum, with the next challenge being to reach $47,000 on a daily basis and surpass $48,000 to confirm a breakout. The bullish momentum is strong and continuing to build. The next target is in the $51,000-$53,000 area.

 

[Zforex]

US Indices

Bullish Momentum Persists as US Stock Indices Extend Gains, Fueled by AI Mega-Caps
The major US stock indexes are on the upswing, posting gains for the fifth week in a row. The S&P 500 and Nasdaq Composite gained 1.4% and 2.3% respectively last week, with mega-cap stocks heavily invested in artificial intelligence providing a significant increase. This rise is further supported by the expectation of upcoming interest rate cuts and a positive corporate outlook.
With a favorable adjustment to inflation figures for the last quarter of 2023, the financial world is eagerly awaiting the release of the Consumer Price Index (CPI) for January. This data, expected on Tuesday, will be crucial in shaping the Federal Reserve's approach to easing monetary policy over the course of the year.
In addition, a number of other economic indicators will be released that will attract the attention of market participants. These include not only the U.S. Core CPI but also Retail Sales, Core Retail Sales, and a variety of indices and reports such as the Philadelphia Fed Manufacturing Index, Export and Import Price Indices , Initial Jobless Claims, and the NY Empire State Manufacturing Index. Additional reports on Industrial and Manufacturing Production, Business Inventories, and Crude Oil Inventories, as well as preliminary figures for Building Permits, Housing Starts, and both the Producer Price Index (PPI) and Core PPI, will be scrutinized. Furthermore, the preliminary Michigan Consumer Sentiment Index will offer insights into consumer attitudes, rounding out a comprehensive view of the economic landscape that will inform investment strategies and market expectations.
The Nasdaq, along with the SP500, is currently experiencing a bullish run and reaching new all-time highs. The momentum behind this trend is strong, with the next target for the Nasdaq being around 18000. However, tomorrow's US inflation rate announcement could have a significant impact on the market's pricing and sentiment, which may lead to either a new record high or a possible correction.
Crypto

Bitcoin Approaches Peak Since Early 2022, Signals Price Correction
Bitcoin's performance has seen a fluctuation, nearly reaching its peak since early 2022, signaling the potential for a price correction. The cryptocurrency slightly dropped below 1% in the last 24 hours to $48,000 after touching $48,800. This level is close to its mid-January high of $49,000, marking a significant recovery from the lows of $42,000 seen last week.
The recent surge in Bitcoin and the broader cryptocurrency market is attributed to the U.S. approval of Bitcoin spot exchange-traded funds (ETFs) and positive market sentiment, reflected in the performance of major stock indices like the Dow Jones and S&P 500. However, the substantial gains hint at the possibility of profit-taking among investors.
Bitcoin's price finished a strong weekly performance breaking 47000 and the strong trend indicates more bullish developments. The bullish momentum is strong and continuing to build. The next target is in the $51,000-$53,000 area.

 

[Zforex]

US Indices

S&P 500 and Nasdaq Futures Dip & Corporates Fluctuate
S&P 500 futures declined by 0.5%, and Nasdaq 100 futures fell by 0.9% as the market braces for the upcoming U.S. consumer inflation report. Economists anticipate the January U.S. CPI to show a monthly increase of 0.2% and an annual rise of 2.9%, a slight deceleration from the previous figures of 0.3% month-on-month and 3.4% year-on-year.
The U.S. stock market faces a significant test today with the release of this economic data, following a robust three-month rally. During this period, mega-cap companies, particularly those in the AI sector, have driven the market to reach new historic highs.
A Bank of America survey indicated that its "Bull & Bear Indicator" has climbed to 6.8, signaling that investor positioning may increasingly pose a challenge for risk assets.
On the corporate side, NVIDIA saw a nearly 1% drop in premarket trading, while Coca-Cola experienced a slight increase of 0.3% after announcing earnings that met expectations and revenue that exceeded them.
The Nasdaq has hit a resistance level at 18000, where it touches the upper parallel of the long-term bullish channel. Today's economic data will mostly influence the performance and direction of the index and could lead to a correction or a breakout considering the current overbought conditions.




Crypto

Bitcoin Tops $50,000 Amid Bullish Sentiment of Traders
Bitcoin's price action has been the center of attention as it soared above the $50,000 mark, a level not seen since December 2021. This rally was partly fueled by the anticipation of a rate cut by the US Federal Reserve, the growing popularity of Bitcoin ETFs, and the upcoming Bitcoin Halving event in April 2024, which historically tends to push the cryptocurrency market to new highs.
Traders have shown bullish sentiment, as evidenced by the increased open interest in Bitcoin and the forced liquidation of short positions when the price broke beyond $49,000. The market's bullish momentum is further supported by the fact that Bitcoin has positioned itself above its 50-day moving average.
The surge in Bitcoin's price has led to a rise in speculative activities, with traders on prediction platforms like Polymarket making significant gains. For instance, a trader made a 550% return betting on Bitcoin's price reaching $50,000 in February. Moreover, options traders are scooping up bets at $65K and higher, reflecting strong bullish market sentiment.
Despite the positive trends, there are concerns about overbought conditions and potential market impacts from the forced sale of cryptocurrencies by the failed lender Genesis. Nonetheless, the market outlook remains optimistic, with forecasts suggesting a continued rise in Bitcoin's value.

 

[Zforex]

US Indices

Futures for the S&P 500 and Nasdaq 100 indicated a lower opening for Wall Street following Monday's public holiday. Financial stocks garnered attention on Tuesday after the announcement that Capital One Financial plans to acquire Discover Financial Services in an all-stock transaction valued at $35.3 billion, anticipated to conclude between late 2024 and early 2025. Following this news, Capital One's shares dropped 3.5% in premarket trading, whereas Discover's shares soared 16.3%.
In earnings news, Walmart Inc. experienced a rise post-earnings beat, despite issuing weaker forward guidance.
Traders have recently adjusted their expectations for a Federal Reserve rate cut to June from March, in light of comments from several Fed officials cautioning against premature optimism for policy relaxation, coupled with economic indicators consistently outperforming expectations. Investors remain cautious, eagerly awaiting the minutes from the Fed's January meeting, set for release on Wednesday.
The Nasdaq's trading pattern reflects significant uncertainty, with the market hesitant to make decisive moves before the release of the FOMC minutes. The 18,000 level continues to act as resistance within the bullish channel, while 17,600 and then 17,000 are identified as the subsequent support levels.

Crypto

Recently, Bitcoin has witnessed a notable resurgence, with its value soaring to around $52,000, the highest in over two years, propelling its market capitalization back above the $1 trillion mark, a feat last achieved at its 2021 peak. This uptick in value is accompanied by an improvement in liquidity, as order books display their most liquid state since October, with market depth approaching $540 million. Enhanced liquidity, particularly on U.S.-based exchanges, facilitates the execution of large transactions with minimal price slippage.
The Bitcoin network is on the cusp of its next halving event around April 19, slated to cut mining rewards to 3.125 Bitcoin per block. This deflationary mechanism, designed to continue until all 21 million Bitcoin are mined (expected around 2140), will notably reduce miners' rewards, though it historically triggers bullish market activity.
The advent of Bitcoin ETFs has simplified investors' access to Bitcoin, boosting its value by nearly 13% following U.S. regulatory approvals. This development, coupled with growing interest from both retail and institutional investors—as evidenced by surging transaction revenues and crypto notional volumes on major exchanges like Coinbase Global and Robinhood Markets—has buoyed market sentiment. The market valuation of digital assets has even surpassed $2 trillion for the first time since April 2022.
Bitcoin is exhibiting a strong bullish trend as it approaches the resistance at 52000 and lingers around it. While a potential correction may occur, taking it back to the 48000 level.

 

[Zforex]

US Indices

US Equity Futures Stable Ahead of Key Inflation Data
U.S. equity futures started the week with minimal changes, following a period where key stock benchmarks hit record highs, as investors awaited crucial inflation data expected later in the week. The stock market enters the last week of February on a strong note, thrilled by significant milestones and positive outcomes from the previous weeks, notably propelled by Nvidia's impressive earnings.
The focus now shifts to the longevity of the AI-driven momentum amid ongoing economic and inflationary concerns. In anticipation, investors are keenly awaiting the release of the monthly Personal Consumption Expenditures (PCE) Price Index, the Federal Reserve's preferred measure of inflation, scheduled for Thursday. This week, attention is moving from corporate earnings to a variety of economic indicators, including the core PCE Price Index, a key metric monitored by the Fed for insights on inflation trends. Additionally, the U.S. GDP figures for the fourth quarter are set for release on Wednesday, and remarks from various central bank officials will be closely analyzed for hints about future interest rate directions.
Adding to the discourse, New York Fed President John Williams recently expressed optimism about the U.S. economy's trajectory and hinted at the possibility of easing interest rates later in the year. In a Friday interview, Williams emphasized the importance of adapting monetary policy based on consistent data indicating a decline in inflation towards the Fed's 2% target, suggesting a potential pullback from the current restrictive stance later this year.
The 18,000 level continues to act as resistance within the bullish channel, while 17,600 and 17,000 levels are identified as subsequent support levels. The Nasdaq continues to display strong momentum and a bullish direction, with the challenge lying in the sustainability of this movement.



Crypto

Ether Surges While Bitcoin Struggles Amid ETF Speculation
Bitcoin remained stable on Monday, except for Ether, which notably outperformed other cryptocurrencies. Bitcoin's price dipped close to 1% to $51,300. Despite positive risk sentiment in the broader markets, with the Dow Jones and S&P 500 at record highs, Bitcoin struggled to climb further. Over six months, Bitcoin has more than doubled, fueled by optimism for the approval of Bitcoin ETFs, anticipated to attract new investors.
Altcoins are leading the market's growth, with institutional speculators favoring Bitcoin and Ethereum, particularly on the prospect of Ether ETFs. Ether has seen a 35% increase in a month, outpacing Bitcoin's 20% rise, as traders speculate on ETF approvals. This shift towards smaller tokens suggests a widening crypto bull market.
Bitcoin is under uncertainty at its actual level. Additionally, reaching the resistance level of 52000 has also contributed to this correction. Although there is potential for further correction, it may rebound back to the 48000 level.

 

[Zforex]

US Indices

Stock Futures Dip After Month of Gains, Nasdaq Leads February Surge
Stock futures declined on Friday, following a month where the market celebrated its fourth consecutive month of gains, and the tech-centric Nasdaq Composite achieved its first closing high since November 2021. The month concluded on a positive note, fueled by enthusiasm over an artificial intelligence-driven rally and anticipations of interest rate reductions. The Nasdaq emerged as February's standout, recording a 6.1% increase, while the S&P 500 saw a 5.2% rise. These gains were bolstered by inflation data revealing the personal consumption expenditures price index, excluding food and energy rose 0.4% in January, aligning with market forecasts. Market participants are now keenly awaiting the ISM Manufacturing PMI data, expected later today, for deeper insights into the manufacturing sector's condition.
Federal Reserve officials have offered varied perspectives on the future of interest rates. Mary Daly emphasized the Fed's readiness to adjust rates as needed, though she sees no immediate requirement due to the economy's strength. Raphael Bostic hinted at possible rate cuts starting this summer, while Loretta Mester, despite recognizing the ongoing need to address inflation, expects three rate cuts this year, a stance unchanged by recent data.
The market is navigating through a phase of optimism, yet faces significant resistance around the 18,000 area, underscoring persistent uncertainties. Support levels at 17,600 and 17,000 are becoming increasingly significant, highlighting the Nasdaq's critical juncture. As the market stands at this crossroads, the direction it will take next is a subject of widespread speculation.
Crypto

Bitcoin Shows Strength Amid Volatility, Accumulation Signals Confidence
Bitcoin has shown remarkable strength amid market volatility, with significant investor accumulation indicating confidence. Analysis revealed over one million addresses have bought more than 671,000 BTC within the $60,334 to $62,155 range, forming a strong support zone. This level may prevent further price declines, reflecting investors' belief in Bitcoin's potential. The majority of Bitcoin, 94.66%, is held by investors profiting from their investments, suggesting a bullish sentiment and possibly more buying activity. With only a small portion of Bitcoin "At the Money" or "Out of the Money," selling pressure remains low. Bitcoin's price has surged to $62,058, a 47.05% increase over the last 30 days, fueled by inflows into Bitcoin spot ETFs and anticipation of the upcoming halving event, expected to drive prices higher due to reduced supply.
Bitcoin is currently advancing toward the $69,000 level, as the momentum is strong enough to provide further fuel. Any correction could bring the price back down to the $60,000 support level.