Análisis de mercado diario

Investors started the week on a cautious note despite data showing that China’s economy bounced back strongly in the final quarter of 2020.

The world’s second-largest economy reported 6.5% growth in Q4, making it one of the few economies to achieve a rapid turnaround amid the global pandemic. Given how U.S. markets were closed on Monday due to the Martin Luther King holiday, there was little movement in the FX space. 

However, the not so ‘mighty’ Dollar caught our attention as prices hovered above the 90.50 level. 

After being constantly bullied and mistreated by G10 currencies, the Dollar seemed to be staging a comeback on Monday. We questioned whether this would be another dead cat bounce or a rebound back to glory…

The Dollar descended back into the abyss thanks to reflation hopes and expectations over the Federal Reserve maintaining its ultra-accommodative monetary policy stance.

It was all about earnings on Tuesday with Netflix and US banking heavyweights in focus. 

Fun fact - by the end of 2020, Netflix’s global base of paid subscribers hit 203.66 million which is roughly above Nigeria’s current population!

On Wednesday, the major talking point was Biden’s inauguration and possible impacts it could have in markets.

There were a couple of technical setups discussed ahead of Biden’s big day, ranging from the EURUSD, GBPUSD, and even AUDUSD.

US stocks rallied to record highs on Wednesday evening as equity bulls approved the latest occupant of the White House, President Joe Biden.

As the peaceful presidential transition fuelled the risk-on mood, the Greenback fell against most high beta currencies and extended its slide to the end of the week.

In Europe, the European Central Bank left interest rates unchanged. The pandemic is expected to weigh on the economy in the first quarter so ample financing remains essential, while the bank is monitoring FX rates very carefully.

A sense of caution returned to markets on Friday as surging coronavirus cases dampened the positive mood. Given how 97 million people have been infected globally, COVID-19 remains a key theme that continues to drain investor confidence.

The week ahead promises to be lively as investors brace for a series of key events and economic data from major economies.

World leaders will be under the spotlight, earnings from big tech firms will be released while the FOMC interest rate decision and data from major economies could spark market volatility.

Exención de responsabilidad: El contenido de este artículo incluye opiniones personales, y no debe ser interpretado como asesoramiento sobre inversión personal y/o de otro tipo y/o una oferta y/o solicitud de ninguna transacción con instrumentos financieros y/o garantías y/o pronóstico de rendimiento futuro. ForexTime (FXTM), sus afiliados, agentes, directores, responsables y empleados no garantizan la precisión, validez, puntualidad o compleción de ninguna información o dato disponible, y no asume ninguna responsabilidad por cualquier pérdida que resulte de cualquier inversión realizada en base a ellos.

Presidential inauguration day is finally here!

Joe Biden will be sworn in as the 46th President of the United States today, following months of drama and defiance from Donald Trump to the outcome of the November elections.

This inauguration will be nothing short of unprecedented given the limited number of people attending because of COVID-19, Trump boycotting the ceremony, and heightened security within the vicinity. 

Symbolically, the Inauguration marks the peaceful transfer of power from the current president to the next. However, given the many variables at play and the fact that Donald Trump has less than 24 hours left as president – grab your popcorn and get ready for a very eventful day ahead.

Earlier today we covered the fundamentals behind Biden’s inauguration and whether it will affect markets.

It is time for us to look at the technicals and potential trading setups ahead of this big event.

Dollar dead cat bounce…

On Monday, we took a deep look at the Dollar Index (DXY) and questioned whether the rebound witnessed last week was nothing more than a dead cat bounce.

Fast forward today, the DXY failed to keep above the 90.50 level with prices approaching the 90.00 support. A breakdown below this point could open the doors back towards 89.20 and 88.30.

EURUSD finds support above 50 SMA 

It looks like the Euro is taking advantage of a softer Dollar. The rebound from the 50 Simple Moving Average has sent prices back towards 1.2150. If the Greenback ends up weakening following Biden’s big day, this could send prices towards 1.2220 and 1.2300, respectively.

Pound eyes 1.3700 

Over the past three weeks, bulls have repeatedly failed to conquer the 1.3700 resistance level.

The weekly trend on the GBPUSD is certainly bullish but it seems like Pound bulls need a kick or fresh catalyst. If prices are able to push above and secure a weekly close above 1.3700, this could open the doors towards 1.3780 and 1.4000.

AUD trapped within a range 

As the title says, the AUDUSD remains trapped within a 130 pip range with support at 0.7670 and resistance at 0.7800. Given how the trend swings in favour of bulls and lagging indicators point to further upside, the currency pair may venture towards the 0.7800 resistance level. A breakout above this point is likely to trigger an incline towards levels not seen since February 2018 around 0.7930.

USDJPY choppy as usual 

The past few days have been quite choppy for the USDJPY as prices bounced within a 55 pip range. A classic breakout/down setup is at play with support seen at 103.60 and resistance at 104.15. As stated earlier, if the Dollar ends up weakening over the next couple of days, this could drag the USDJPY below 0.7670 with the first point of interest at 103.00.

Exención de responsabilidad: El contenido de este artículo incluye opiniones personales, y no debe ser interpretado como asesoramiento sobre inversión personal y/o de otro tipo y/o una oferta y/o solicitud de ninguna transacción con instrumentos financieros y/o garantías y/o pronóstico de rendimiento futuro. ForexTime (FXTM), sus afiliados, agentes, directores, responsables y empleados no garantizan la precisión, validez, puntualidad o compleción de ninguna información o dato disponible, y no asume ninguna responsabilidad por cualquier pérdida que resulte de cualquier inversión realizada en base a ellos.

US stock futures are rising, ahead of Joe Biden’s presidential inauguration later on Wednesday. S&P 500 futures are trying to reassert themselves back above the 3800 handle in a bid to erase last week’s losses.

The coronavirus has already nullified any chance of large-scale gatherings for the event. Instead, Washington DC will be filled with some 25,000 National Guard soldiers while the White House and the Capitol building are surrounded by tall fences, in a bid to stem any threat of violence after Capitol Hill was swarmed by a pro-Trump mob earlier this month.

While markets may not react much to the subdued fanfare surrounding today’s inauguration, investors are already peering over the day’s proceedings and trying to anticipate what this incoming administration may herald for markets.

Here is a sampling of some policy moves to look out for, and the potential assets that could be affected:

• More fiscal stimulus

President-elect Biden has already unveiled a $1.9 trillion stimulus plan, with potentially more to come. His nominee for US Treasury Secretary, Janet Yellen, told the Senate on Tuesday that the economic rescue package is the immediate priority, and cited the need to “act big”.

WATCHLIST: US Stocks, Dollar, Gold

• Higher taxes and regulations

Given the more pressing concerns surrounding the US economic recovery, there is less of an imminent risk that the Biden administration would push through traditionally Democrat-favoured policies such as tax hikes and heightened regulations. Still, that isn’t stopping investors from already trying to ascertain the likelihood and the potential timeline for such an agenda to eventually force its way through sometime over the next 4 years.

WATCHLIST: Banking stocks, Big Tech

• Persisting US-China trade tensions

Yellen used strong words when addressing US-China relations moving forward, dashing hopes that there could be a major reset in ties between the world’s two largest economies under the new POTUS. At least investors can bid adieu to Trump’s policy-by-tweets that shook global markets at unpredictable intervals, and also perhaps to the in-your-face nature of the trade war that the world had grown so accustomed to in recent years.

WATCHLIST: Chinese Yuan, Asian stocks

• Green agenda to the fore

During the presidential debates, then-Democratic presidential candidate Biden already made his ambitions known to “transition” America away from its dependence on Oil. The green agenda may be made clear on day one of the Biden administration, with the incoming POTUS reportedly set to cancel the Keystone XL Pipeline which moves oil across the US-Canada border.

WATCHLIST: US crude, Big Oil, Tesla, FXTM Green index

Indeed, a massive burden now falls on the shoulders of the 46th President of the United States. Not only does Biden have to try and heal a politically-divided nation, but his immediate gargantuan task is to help the pandemic-ravaged US economy recover.

Even as risk assets bask in the potential near-term upside based on the US economic recovery prospects, the road ahead requires investors to remain vigilant as to what President Biden’s policies could mean for broad asset classes.

Exención de responsabilidad: El contenido de este artículo incluye opiniones personales, y no debe ser interpretado como asesoramiento sobre inversión personal y/o de otro tipo y/o una oferta y/o solicitud de ninguna transacción con instrumentos financieros y/o garantías y/o pronóstico de rendimiento futuro. ForexTime (FXTM), sus afiliados, agentes, directores, responsables y empleados no garantizan la precisión, validez, puntualidad o compleción de ninguna información o dato disponible, y no asume ninguna responsabilidad por cualquier pérdida que resulte de cualquier inversión realizada en base a ellos.

China has officially posted an annual GDP growth of 2.3% in 2020, making it one of the few economies that recorded an expansion amid the global pandemic.

This is a remarkable achievement for the world’s second largest economy, considering that other major economies are still battling with extended lockdowns and are facing the threat of a double-dip recession.

Following such a headline, only benchmark indices in China and Hong Kong are climbing, while the rest of Asia is in the red. The Hang Seng index is making further strides in breaking out of its multi-year downtrend, though it remains some 13.65 percent away from its record high set in January 2018 and needs to post a higher high above 29,122 to confirm the breakout on the weekly chart.

Here are other key events for the global markets this week:

• Monday, 18 January: US markets closed
   
• Tuesday, 19 January: Netflix Q4 earnings (after US markets close)
   
• Wednesday, 20 January: Joe Biden presidential inauguration
   
• Thursday, 21 January: ECB rate decision
   
• Friday, 22 January: US, Euro-area, UK Markit PMIs

Tuesday, 19 January

Netflix is set to announce its Q4 earnings after US markets close on Tuesday, with the pandemic darling’s stock prices needing a boost. Stock prices have dropped by nearly 8 percent so far in 2021, and is still keeping to the same range since July, with its 50-day and 100-day simple moving averages (SMA) now flat.

Still, the streaming giant has ambitious plans: it’s set to release 70 original films in 2021, and that doesn’t include documentaries.

It remains to be seen how much this lineup of new titles can add to Netflix’s subscribers tally, which is expected to have crossed the psychologically-important 200-million mark during the final three months of 2020.

Wednesday, 20 January

As the world hopes for a peaceful transition during Joe Biden’s presidential inauguration on Wednesday, equity bulls may have to bide their time before pushing benchmark indices higher.

Investors have been rather sanguine in their initial assessment of Biden’s fiscal stimulus plans, and are wary about the new regulations that a Democratic president may herald for markets and businesses.

Since Biden announced his US$1.9 trillion proposal this past Thursday, all three major US equity benchmarks posted losses before the long weekend. US stocks had appeared exhausted last week and are in need of fresh catalysts, with the futures contract kicking off the week with a risk-off tone at the time of writing.

Thursday, 21 January

The European Central Bank is unlikely to make any major changes to its policy settings on Thursday, keeping its benchmark interest rate at minus 0.5 percent. However, the ECB is expected to reiterate its commitment to supporting the EU economy, even as it battles renewed and extended lockdown measures which are set to result in a GDP contraction for the current quarter.

The Euro’s fortunes have very much been dictated by the US Dollar of late, with most G10 currencies posting year-to-date declines against the Greenback.

The Euro, which accounts for 57.6 percent of the Dollar index (DXY), may have little leg to stand on for the time being, and may have to wait for US yields to subside before enjoying some reprieve against the Dollar’s 2021 rebound.

Friday, 22 January

Major economies are due to have their respective purchasing manager’s indices (PMI) released by Markit on Friday.

Should the manufacturing sectors in these countries prove resilient, that could help Oil prices climb on hopes that the global economic recovery has not been severely derailed by Covid-19’s resurgence.

EIA crude inventories data will also be released on Friday, and Oil bulls will also want to see another major drawdown in US crude inventories, which have already fallen to their lowest since March.

Brent futures posted their first weekly decline of the year last week, and are continuing to trim their year-to-date gains on Monday. Still, the recent pullback may be deemed as healthy, given that Brent oil has spent most of 2021 so far in “overbought” territory.

Exención de responsabilidad: El contenido de este artículo incluye opiniones personales, y no debe ser interpretado como asesoramiento sobre inversión personal y/o de otro tipo y/o una oferta y/o solicitud de ninguna transacción con instrumentos financieros y/o garantías y/o pronóstico de rendimiento futuro. ForexTime (FXTM), sus afiliados, agentes, directores, responsables y empleados no garantizan la precisión, validez, puntualidad o compleción de ninguna información o dato disponible, y no asume ninguna responsabilidad por cualquier pérdida que resulte de cualquier inversión realizada en base a ellos.