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The Federal Open Market Committee (FOMC) meet on the 30th and 31st:

• statement due at 1400 US Eastern time (1800 GMT)
• Federal Reserve Chair Powell’s press conference follows a half hour later

Deutsche Bank expect nothing at this week’s meeting:

• first 25 basis point cut in September
• followed by a 25 bp cut in November
• and then another 25 bp cut in December
• then a pause until September 2025

Bank of America say so, “We think the markets are back to being overly optimistic about the upcoming rate cycle”

• Bank of America says strong economic growth in the US means the FOMC ‘can afford to wait’

Earlier:

• Morgan Stanley says this week’s FOMC statement will lay foundation for 3 cuts this year
• UBS says a Federal Reserve policy pivot is “on the horizon”
• Timiraos: Fed cut unlikely on Wednesday but officials wary of waiting too long

This article was written by Eamonn Sheridan at www.forexlive.com.

Apart from what has been posted there are no fresh catalysts.

USD/JPY rose on early demand, said to be mainly from Japanese buyers. The rally coincided with the Japanese morning and into the Tokyo fix, so that looks likely.

Since then its dropped a big figure or so.

Looking ahead for the session, notable option expires due at 10am NY time include circa $1.5bn around 154.00, and between 153.40 and 153.50 there are $1.1bn in expiries.

This article was written by Eamonn Sheridan at www.forexlive.com.

Stocks Rally After Inflation Data – Dow Up 1.6%

US stock markets received a boost on Friday following a challenging week, as the PCE Price Index data aligned with expectations, raising hopes for a September rate cut by the Fed. The Dow led the gains, finishing the day up 1.64%, followed by the S&P 500 which rose by 1.11%, and the Nasdaq which gained 1.03%. US Treasury yields fell across the board, with the 2-year yield dropping 5.4 basis points to 4.389% and the 10-year yield decreasing by 5.6 basis points to 4.200%, while the dollar remained stable against most major currencies. Oil prices fell again amid ongoing discussions about a ceasefire in Gaza, with Brent crude down 1.5% to $81.31 and WTI crude off 1.4% to $77.16. Gold, however, saw a rise due to the weakening yields, increasing by 0.8% to close the New York session at $2,383 per ounce.

Central Banks in Focus This Week

This week is set to be pivotal for traders, with significant attention on the rate decisions from the Fed, the Bank of Japan (BOJ), and the Bank of England (BOE). The Fed is widely expected to keep rates unchanged, but both the BOJ and the BOE are anticipated to generate considerable market volatility with their decisions and subsequent statements. There is considerable debate regarding whether the BOJ will hike rates or adjust its bond purchasing activities this month, leading to expected movements in the Yen. For the BOE, the market is currently pricing in a 49% chance of a rate cut on Thursday, as high services and core inflation data contend with lower CPI figures and political pressure to reduce rates.

Quiet Trading Day to Kick Off a Massive Week

The first three trading sessions of the week are expected to be quiet, with little macroeconomic data scheduled. Traders anticipate range-bound conditions as the market braces for a potentially pivotal week ahead. While there will be some lower-tier data from the UK early in the European session, it is not expected to significantly impact markets. With a significant amount of data, central bank rate decisions, and other economic updates on the horizon, today is likely to be a calm before the storm as the market prepares for potentially substantial movements later in the week.

The post General Market Analysis 29/07/2024 first appeared on IC Markets | Official Blog.

Horrific news out of the Middle East over the weekend:

Distasteful as it is to say at a time like this, this has implications for markets. Oil prices have risen, traders fearing further escalation in the region.

Israel’s security cabinet authorised Prime
Minister Benjamin Netanyahu’s government to decide on the
“manner and timing” of a response to the rocket
strike in the Golan Heights that killed 12 teenagers and
children.

Iran-backed Hezbollah has been blamed.

This article was written by Eamonn Sheridan at www.forexlive.com.

The Australian Prudential Regulation Authority (APRA) is the prudential regulator of the Australian financial services industry.

• Will keep macroprudential policy settings on hold following latest
  quarterly assessment of domestic and international economic
  conditions
• Quality of new
  housing lending remains sound, arrears rates on mortgage and business
  lending portfolios continue to rise slowly
• Mortgage
  serviceability buffer will be kept at 3 percentage points and lending
  limits have not been applied
• Countercyclical capital buffer will remain at 1.0% of risk weighted assets

Comments from APRA follow their latest quarterly assessment of domestic and international economic conditions.

This article was written by Eamonn Sheridan at www.forexlive.com.

It was a volatile week for global financial markets last week, and the week ahead has the potential for even more significant moves across various products. There are key rate decisions from the Fed, the Bank of Japan, and the Bank of England, in addition to a plethora of important tier 1 data releases and crucial earnings reports from major tech firms. Microsoft, Meta, Apple, and Amazon are all set to report earnings this week, and investors are expecting increased volatility around these updates.

The week starts off slowly with a very quiet Monday, but momentum on the event calendar soon picks up and continues through to the final trading session, with the Non-Farm Payrolls from the US closing out the week on Friday.

Here is our usual day-by-day breakdown of the major risk events this week:

It’s a relatively quiet start to the week in terms of economic event risks, with little on the calendar in terms of tier 1 data across all three trading sessions. Asian markets are expected to start on the front foot after a strong day on Wall Street on Friday, but expect more rangebound conditions as investors look ahead to the risk events over the rest of the week.

The calendar picks up a bit on Tuesday with the German states reporting preliminary CPI data in the European session. The New York session sees the first tier 1 updates from the US, with both the CB Consumer Confidence number and the JOLTS Job Openings data due out.

It is a huge day on the calendar on Wednesday. The early focus in the Asian session will be on Australia, where both the CPI data and retail sales numbers are due out, before focus moves north to Japan for the much-anticipated Bank of Japan rate call and associated updates. The European session has the key core CPI numbers due out for the Eurozone before New York opens, bringing several updates.

The US has ADP Non-Farm, Employment Cost Index, and Pending Home Sales numbers all due out early in the session, while we also have the Canadian GDP data out north of the border. The trading day is then closed out with the latest update from the FOMC, and although no move is expected with the rate, traders will be looking for signs that a cut will come at the next meeting.

It is a quieter day in the Asian market on Thursday with nothing of note on the schedule. The focus will be firmly on the UK markets once Europe opens, with the Bank of England set to update investors on its latest rate call. The New York session sees yet more tier 1 data out of the US, with the weekly unemployment claims numbers due out before the ISM Manufacturing PMI data is released.

There is more on the event calendar on Friday that could keep traders on their toes into the weekend. The Asian session is relatively quiet from a calendar point of view, but the focus will be on Switzerland once the London session kicks off with the release of key CPI data there. The main event for the day will come early in the New York session when the key job market data is released in the US, with the headline non-farm data due out alongside the Average Hourly Earnings numbers and the unemployment rate.

The post The Week Ahead – Week Commencing 29 July 2024 first appeared on IC Markets | Official Blog.

Bloomberg had the report, ICYMI.

Bloomberg is gated, but in brief:

• China is considering a fee hike of at least tenfold on high-frequency trading
• Chinese authorities deem some quantitative strategies a threat to fairness in the nation’s retail investor-dominated stock market
• Consultations have taken place between the China Securities Regulatory Commission (CSRC) and the country’s stock exchanges and some market participants
• Draft plans are to raise a 0.1 yuan (1.4 cents) fee on buy and sell orders to at least 1 yuan if the transactions meet the threshold of high-frequency trading

This article was written by Eamonn Sheridan at www.forexlive.com.

There is some low-impact data from Singapore:

• business confidence
• export and import prices
• PPI

But nothing for major FX.

I’m sure we’ll get something to shift major FX rates around, perhaps a headline or two.

This article was written by Eamonn Sheridan at www.forexlive.com.

Good morning, afternoon and evening all. Any charts, technical analysis, trade ideas, thoughts, views, ForexLive traders would like to share and discuss with fellow ForexLive traders, please do so. Post ’em if ya got ’em!

This article was written by Eamonn Sheridan at www.forexlive.com.

As is usual for a Monday morning, market liquidity is very thin until it improves as more Asian centres come online … prices are liable to swing around, so take care out there.

Indicative rates:

• EUR/USD 1.0866
• USD/JPY 153.85
• GBP/USD 1.2865
• USD/CHF 0.8833
• USD/CAD 1.3836
• AUD/USD 0.6550
• NZD/USD 0.5898

This article was written by Eamonn Sheridan at www.forexlive.com.

• Filled with respect and admiration for what the Bitcoin community has achieved
• Bitcoin is a miracle of cooperation and human achievement
• If US doesn’t embrace crypto technology, China and other countries will dominate
• Bitcoin is going to the moon, I want the US to lead the way
• “Never sell your Bitcoin”
• “I want crypto to be mined and made in America”
• Will appoint a Bitcoin and crypto presidential advisory council when he gets elected
• Will create a strategic national Bitcoin stockpile

He also adds that he will fire SEC chair, Gary Gensler, “on day one” as he says that he wants someone in the post who “should not block the future”. For some context, Gensler is not the most popular person in the crypto industry amid his views and law enforcing actions against the likes of Coinbase and Binance.

Besides that, Trump also vows to make the US the “crypto capital of the planet” and says that Bitcoin isn’t a threat to the dollar’s status.

Amid his comments, Bitcoin turned lower initially from $68,400 to $66,635 before pushing back up to $69,000. The price is now trading at $68,140 but it is more or less flat on the week itself.

This article was written by Justin Low at www.forexlive.com.