CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 64.86% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
*US stocks moved higher, with the S&P500 bouncing off its 50-day SMA
*Oil jumped higher above $75 on a larger than expected drawdown in crude stocks
*Aussie employment tumbled, NZ economy was humming prior to lockdown
USD sold off mildly with yesterday’s risk-on mood. It remains in the range, trading around 92.50. Commodity currencies led the gains as energy prices surged. CAD rose +0.5% and NOK +0.8%. EUR/USD remains supported by the key 1.18 level. GBP drew support from the strongest CPI in nine years but is similarly rangebound. USD/JPY broke down and dropped closer to 109 support.
US equities gained with the S&P500 posting its biggest daily increase since the end of August, boosted by the energy sector. The Vix is now trading near 18 and the 10-year US bond yield has reversed about half of its post-CPI decline. Asian shares have given up earlier gains, weighed by declines in China and Hong Kong. US futures are flat
Market Thoughts – USD directionless
We get US weekly jobless claims data and retail sales this afternoon. The former is expected to grind to a new pandemic low. August retail sales may show another fall for a second month with analysts forecasting a print of -0.8%. The rotation into services and Delta concerns are weighing, as the boost from stimulus checks fades.
USD is struggling to find a strong sense of direction as the weak NFP and CPI data dent Fed expectations. That means the world’s most important central bank can take its time tapering, which would typically boost the dollar. Meanwhile continued concerns about the Delta impact keep support. As does its influence on global rebound prospects underscored by China’s softening recent activity data.
Chart of the Day – Oil and gas prices surge
There was much chatter about energy prices yesterday. The looming/unfolding European energy crisis saw gas and electricity prices jump. Oil closed north of $75 for the first time since the end of July. Stocks and bond markets didn’t flinch with energy stocks hugely outperforming. That says rising commodity prices are currently being seen as reflationary rather than stagflationary.
After making lows at $64.76 in late August, crude staged an impressive two-day rebound back to the 50% retrace level of the summer high to low move. Prices have then tracked sideways over the last couple of weeks. Monday saw a break out of consolidation and the larger-than-expected drawdown in US crude oil stocks propelled prices above $75. The 78.6% Fib level sits at $75.03 with the July top at $77.82. Support comes in at the top of the rcent range around $73.73.
Jamie DuttaAnalyst / Trader
"With extensive experience as a full time trader and financial market commentator, I have worked in top tier investment banks, trading houses and with retail trading platforms. I combine technical analysis with a deep fundamental knowledge to identify trade set-ups. My real life experience allows me to break down the complexities of financial jargon and trading. This means everyone can better understand the compelling forces of greed and fear which are realised every day in countless ways across markets."
Vantage FX does not represent or warrant that the material provided here is accurate, current, or complete, and therefore should not be relied upon as such. The information provided here, whether from a third party or not, is not to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any financial instruments; or to participate in any specific trading strategy. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. We advise any readers of this content to seek their own advice. Without the approval of Vantage FX, reproduction or redistribution of this information is not permitted.
Risk Warning CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 36.36% of retail investor accounts lose money when trading CFDs with this provider.
You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 64.86% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. You should make sure you understand the risks involved, seeking independent advice, if necessary. Please read our legal documents and ensure that you fully understand the risks before you make any trading decisions.
Vantage FX is a trading name of Vantage Global Prime LLP, authorised and regulated by the Financial Conduct Authority. FRN: 590299. 7 Bell Yard, London, WC2A 2JR.
Telephone calls and online chat conversations may be recorded and monitored. Any views, opinions, technical market information or commentary published on the website are necessarily of a general educational nature only and do not constitute, and should not be considered as, investment advice as they do not take into account any individual client's investment objectives, financial resources or attitude to risk.
Regional Restrictions: We do not offer our services to residents of certain jurisdictions such as North Korea, Canada, United States and some other regions. For more information please refer to our FAQ page.
Vantage Global Prime LLP is part of Vantage Group of Companies (the ‘Group’). The Group comprises various entities which are authorised and regulated in various jurisdictions.
Vantage International Group Limited trading under Vantage FX, is authorised and regulated by the Cayman Islands Monetary Authority (CIMA), Securities Investment Business Law (SIBL) number 1383491 and is registered at Artemis House, 67 Fort St, PO Box 2775, Grand Cayman KY1-1111.
For clients who onboarded via vantagefx.com Vantage FX | SIBL Number 1383491 Email: [email protected]
Vantage Global Prime Pty Ltd trading under Vantage FX, is regulated by the Australian Securities and Investments Commission (ASIC), AFSL no. 428901 and is located at level 29, 31 Market St, Sydney, New South Wales, 2000, Australia.
For clients who onboarded via vantagefx.com.au Phone: 1300 945 517 Email: [email protected]
For clients who onboarded via vantagefx.co.uk Phone: +44(0)20 7043 5050 Email: [email protected]