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EU flash CPI misses (higher), core misses as well… note data is taken before the spike in energy prices
XAUUSD (GOLD) UPDATE
- Retracing off its 5419 high with brief breaks of 5260 and the 4 hour trendline so far seeing limited follow through..
- XAUUSD’s retreat when it should be seeing safe haven demand may simply be a case of liquidity needs, selling winners to cover losses or margin needs elsewhere.
- In any case, needs to hold 5200 to avoid a further squeeze and keep a bid pointed higher.
XAUUSD 4 HOUR CHART
XBRUSD (BRENT OIL) UPDATE
- Rising oil prices are driving the risk off mood elsewhere.
- XBRUSD extending its high and while above $80, talk will be for a risk to $100 oil.
- I am not aure how important old resistance levels are but these are what charts show: 82.87, 88.,63, 92.43
- Only sub-80.00 would postpone the risk.
XBRUSD 4 HOUR CHART
Forex Market Snapshot
- More logic to price action today with equities following the geopolitical crisis script by retreating after yesterday’s head scratching rally off the lows failed to follow through .
- What caught my eye today was while the USD caught a safe haven bid, US bond yields again firmed, suggesting market concerns that rising energy prices will fuel inflation.
- In forex, the EURUSD break of 1.1670 exposes the 1.15s while below it.
- USDJPY has seen some caution (but remains bid) after a verbal intervention threat. In this envrionmnet, any reaction to intervention wouild likely be met with bids below the market.
- CHF is underperformning and not getting the typical safe haven bid. The SNB indicated it is prepared to intervene in the FX market.
- Light US calendar today will keep attention on the reaction to headlines from the Middle East perhaps more than the news itself.
Reaction so far only partially following the script (Gold up, oil up, USD up but US bond yields up, stocks initially down but then recovered depending on sector) but it is still early in this crisis.
In our blog
Geopolitical Crisis and Market Impact: Oil, Inflation, and Safe-Haven Flows in Focus
US500 (SP500) UPDATE
- A lot of head scratching in equities followinbg the whipsaw turnaround
- For the rebound off a 6760 low to have legs, 6905-15 would need to be taken out.
- Otherwise, it is back to headline watching and the reaction to news.
- In any case, suggest taking it one day at a time.
US500 1 HOUR CHART
NAS100 (NASDAQ) UPDATE
- Tech trying to throw equities a lifesaver with a test of 25050 but during this geopolitical crisis, suggest taking it one day at a time.
- With that said, 25000 is again in the spotlight with a firm move above (specifically 25050+) needed to cool the downside risk, for one day at least should such a move occur…
NAS100 1 HOUR CHART
One Source of Strength in the Markets Today: Tech Stocks
Nvidia, Palantir and long-suffering Intuit were among the biggest gainers Monday as investors set aside tech fears.
While some traders spent the morning trying to digest the fallout of U.S. attacks on Iran over the weekend, others found value in tech. By lunchtime, the tech-heavy Nasdaq was up 0.3%, while the S&P 500 and Dow Jones Industrial Average were more or less flat.
DAX Index
Frankfurt’s DAX 40 closed about 2.6% lower at 24,672 on Monday, the lowest since early February and underperforming its European peers.
Investors continued to assess the economic fallout from the Middle East conflict, particularly the risk of disruptions to energy supply chains and the potential impact on global economic stability.
This could translate into a new inflationary surge, undermining forecasts so far of potential rate cuts by the Federal Reserve and the European Central Bank.
Among the hardest-hit companies were travel and tourism stocks, pressured by flight cancellations to the Middle East and soaring oil prices.
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