Is Solid Power (SLDP) Stock A Buy

Economic

Summary:

Should you invest in Solid Power (SLDP)? Dive into this review to understand the potential of their solid-state battery tech, the current state of the company, and the risks and rewards of investing in SLDP stock.

Solid Power Inc. (SLDP) is a company developing all-solid-state battery technology for the electric vehicle (EV) market. This technology has the potential to revolutionize the EV industry by offering significant improvements over traditional lithium-ion batteries. However, SLDP is still in the early stages of development, and its stock is a high-risk, high-reward investment.

The Promise of All-Solid-State Batteries

Solid-state batteries offer several advantages over lithium-ion batteries:

Higher Energy Density: Solid-state batteries can store more energy per unit weight, potentially increasing an EV's range.

Faster Charging: Solid-state batteries may enable EVs to charge significantly faster than current models.

Improved Safety: Solid-state batteries are considered safer than lithium-ion batteries, as they are less prone to fires.

If Solid Power can successfully develop and commercialize its all-solid-state battery technology, it could become a major player in the EV battery market. This potential is reflected in the significant hype surrounding SLDP stock.

Current State of SLDP

Despite the promise of its technology, SLDP faces several challenges:

Early Stage Development: The company is still in the pre-revenue stage, meaning it is not yet generating any sales.

Technical Hurdles: Developing and manufacturing solid-state batteries on a commercial scale presents significant technical challenges.

Competition: Several established companies and startups are also developing solid-state battery technology.

These factors contribute to the high volatility of SLDP stock. The price has fluctuated significantly in recent months, and it is likely to remain volatile in the near future.

Analyst Opinions on SLDP

Analysts' opinions on SLDP are mixed. Some analysts are bullish on the company's long-term potential, citing the potential of all-solid-state battery technology. Others are more cautious, highlighting the risks associated with the company's early stage of development and the competitive landscape.

Here's a snapshot of current analyst sentiment:

Average Price Target: While analyst price targets vary, the average sits around $3.17, which represents a potential upside of 60.51% from the current price (as of May 21, 2024).

Overall Consensus: The current analyst consensus rating on SLDP is "Hold," indicating that analysts believe the stock price is fairly valued at its current level.

Should You Invest in SLDP?

The decision to invest in SLDP depends on your risk tolerance and investment goals. Here are some factors to consider:

High Risk, High Reward: SLDP is a high-risk investment, but it also has the potential for high rewards if the company can successfully commercialize its technology.

Long-Term Investment: This is a long-term play. It may take several years for SLDP to develop and commercialize its technology.

Do Your Research: Before investing in SLDP, it is important to do your own research and understand the risks involved.

Alternatives to SLDP

If you are interested in investing in the EV battery market, but are hesitant about the high risk associated with SLDP, you may want to consider investing in established battery companies or companies developing other EV technologies.

Here are some alternatives to consider:

Lithium-Ion Battery Manufacturers: Companies like LG Chem, Panasonic, and CATL are major players in the lithium-ion battery market. While they may not offer the same potential upside as SLDP, they are considered to be lower-risk investments.

EV Charging Infrastructure Companies: Companies developing and deploying EV charging infrastructure are also poised to benefit from the growth of the EV market.

Conclusion: A Promising Technology with Uncertain Future

Solid Power's all-solid-state battery technology has the potential to revolutionize the EV industry. However, the company is still in the early stages of development, and its stock is a high-risk investment. Carefully consider your risk tolerance and investment goals before making any decisions.

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Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

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Kevin Du

Central Bank

Economic

The Japanese Government and the Bank of Japan

On Wednesday (May 15), Bank of Japan views on monetary policy and Japanese government talk about interventions may impact buyer demand for the USD/JPY.

The USD/JPY advanced for the sixth time in seven sessions on Tuesday (May 14), raising the risk of a government intervention. A weaker Japanese Yen could raise import costs and impact household spending. Downward trends in household spending would affect the Japanese economy. Private consumption contributes over 50% to the Japanese economy.

While the Japanese government will monitor Yen price movements, investors should consider Bank of Japan commentary. On Tuesday, Finance Minister Shunichi Suzuki reportedly said the government will work closely with the BoJ. Bank of Japan comments on raising interest rates would influence buyer appetite for the Japanese Yen.

There are no stats from Japan for investors to consider before GDP numbers on Thursday (May 16).

US Economic Calendar: US CPI Report, Retail Sales, and the Fed

Later in the Wednesday session, US inflation and retail sales figures will put the Fed under the spotlight.

Following the upward trend in US producer prices, a hotter-than-expected US CPI Report could refuel speculation about a Fed rate hike.

Economists forecast the US annual inflation rate to fall from 3.5% to 3.4% in April. Furthermore, economists expect the core inflation rate to ease from 3.8% to 3.6%.

A more hawkish interest rate trajectory would raise borrowing costs and reduce disposable income. Downward trends in disposable income could affect consumer spending and dampen demand-driven inflation.

However, retail sales figures could also influence the Fed rate path. Weaker-than-expected retail sales figures could signal a softer inflation outlook and reduce the chances of a Fed rate hike. Economists forecast retail sales to increase by 0.4% in April after rising by 0.7% in March.

With inflation and retail sales in focus, FOMC member commentary also needs consideration. FOMC members Neel Kashkari and Michelle Bowman are on the calendar to speak. Reactions to the US data and views on the Fed rate path warrant investor attention.

Short-term Forecast

Near-term trends for the USD/JPY will hinge on the US CPI Report and FOMC member commentary. A hotter-than-expected US CPI Report could reduce investor bets on a September Fed rate cut and tilt monetary policy divergence toward the US dollar. However, US retail sales figures and intervention chatter to bolster the Yen will also influence the USD/JPY pair.

USD/JPY Price Action

Daily Chart

USD/JPY Forecast: Yen at Risk as BoJ, US Economic Data Take Center Stage_1

The USD/JPY remained well above the 50-day and 200-day EMAs, confirming the bullish price trends.

A breakout from the 156.5 handle could signal a USD/JPY move toward the 158 level. A USD/JPY return to 158 could give the bulls a run at the April 29 high of 160.209.

On Wednesday, the BoJ, the Japanese government, US economic indicators, and the Fed need consideration.

Alternatively, a USD/JPY drop below 155.5 would bring the 50-day EMA into play. A break below the 50-day EMA could give the bears a run at the 151.685 support level.

The 14-day RSI at 60.65 indicates a USD/JPY move to the 160 handle before entering overbought territory.

Source: FX Empire

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

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Alex

Economic

Stocks

Investors' newfound optimism on the U.S. economy faces an important test on Wednesday, with consumer price data set to show whether the soft landing hopes that have fueled recent gains in equities are justified.

Investors' resurgent appetite for equities has driven the S&P 500 back near record highs. Meanwhile, eye-popping rallies in shares of GameStop and other so-called meme stocks suggests that risk-takers are riding high in more speculative corners of the market.

In options markets, the Cboe Volatility Index, known as Wall Street's "fear gauge" because it shows demand for protection against stock swings, stood near its lowest level in about two months on Tuesday.

Many of those moves have been driven by rekindled hopes that the Federal Reserve can pull off an economic soft landing, where it is able to cool inflation without badly hurting growth and eventually transition to cutting interest rates.

Still, while Fed Chairman Jerome Powell has downplayed the potential for rate hikes this year and recent data showed cooling in the labor market, the soft landing scenario is by no means a foregone conclusion.

Another stronger-than-expected inflation reading on Wednesday could spark more worries that a too-hot economy will force the Fed to raise rates again, throwing cold water on investors' recent optimism and undercutting the case for more gains in stocks and bonds.

"It's a pretty critical short-term report," said Keith Lerner, co-chief investment officer at Truist Advisory Services. "If you look at a lot of the markets right now, they're at potential inflection points."

Markets tend to be more volatile on days of CPI releases. The S&P 500 has moved by 0.7% on CPI days over the past year, on a median basis, versus 0.5% on all other days, according to an analysis by Goldman Sachs strategists. The 10-year U.S. Treasury yield moved by 11 basis points on days of CPI releases, compared with a typical move of 4 basis points on all other days, the analysis showed.

S&P options currently show traders pricing in a move of 0.9%, derivatives strategists at Barclays said in a note on Tuesday.

"While there is potential for significant volatility in either a CPI beat or a miss, equity volatility is priced for a more benign outcome," the Barclays strategists wrote. Hopes for 'Soft Landing' at Stake as Investors Await US Inflation Data_1

Hopes for 'Soft Landing' at Stake as Investors Await US Inflation Data_1

The CPI index for April is expected to have climbed 3.4% on an annual basis, according to a Reuters poll of economists. On Tuesday, Powell reiterated that he believed that the Fed's next move is unlikely to be a rate increase. He also said he still expects inflation to cool throughout 2024, though his confidence in that has fallen after prices rose faster than projected through the first quarter.

Fed futures show the market expects about 40 basis points of monetary policy easing this year, according to LSEG data. That compares to more than 150 basis points that had been priced in January.

"The market overall is really pricing in rate cuts," said Jack Ablin, chief investment officer at Cresset Capital. "In order to fulfill these expectations, we're going to need data like CPI to cooperate."

Despite the recent gains in stocks, market indicators generally do not suggest too much speculative excess or over-exuberance.

The forward price-to-earnings ratio for the S&P 500 has risen to 20.5 times, well above its historic average of 15.7, according to LSEG Datastream. Still, that's below the 21.2 level the index reached in March.

Hopes for 'Soft Landing' at Stake as Investors Await US Inflation Data_2

Investor sentiment is at its most bullish level in a month, according to the widely used survey from American Association of Individual Investors, which could raise the bar for positive surprises to help stocks. But the portion of investors reporting bullish sentiment, 40.8%, is below where it stood earlier in the year.

Hopes for 'Soft Landing' at Stake as Investors Await US Inflation Data_3

Some market watchers do see worrying signs. Matt Maley, chief market strategist at Miller Tabak, said that the market's rebound after falling from its March record high leaves it vulnerable to a chart pattern known as a double top.

That's "one of the most bearish signals we see in technical analysis," Maley said in a note on Monday. "If this week's inflation data creates a substantial reversal, it's going to be a very negative development," Maley said.

Source: Reuters

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Risk Warnings and Disclaimers

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FxPro

Commodity

Economic

Crude oil has been under pressure over the past four weeks but has been gaining support on the decline to $77 per barrel WTI and $82 per barrel Brent since the beginning of the month. The price has been consolidating in roughly the same area for over a month since the second half of February. Then, there was a prolonged pause in growth to overcome the 200-day average. Now, it could be a pause before a further plunge.

The bears showed their strength a fortnight ago, causing a 4.5% drop in two days and pushing the price immediately below the 50- and 200-day moving averages, which are filters of the medium- and long-term trend, respectively. From this perspective, the subsequent consolidation last week and at the start of this week may be an attempt to remove excessive short-term oversold and build strength and liquidity for a new attack.

Oil Retreating But Unlikely to Repeat Collapses of 2020, 2014 or 2008_1

Also, the latest consolidation area roughly coincides with the support of the ascending corridor that has been in force for the past five months. A new downside momentum would be a formal prologue to break the uptrend with a potential downside target at $75 for WTI and around $79 for Brent. Near these levels lies the 200-week moving average, a dip below which has intensified discussions on production cuts, resulting in an upward reversal of prices. Impulsive dips below did not exceed 3% for over a year.

Oil Retreating But Unlikely to Repeat Collapses of 2020, 2014 or 2008_2

The US government’s stance has also changed over the past two years, and we are seeing buying to replenish reserves in downturns, as was the case late last year and early this year.

Of course, OPEC support and purchases into US reserves do not provide infinite support, and the market easily passed it in 2020, 2014 and 2008, and briefly in 2018 if we take the most recent history. Thus, oil’s failure under $72.5 for WTI and $76.3 for Brent could signal that the sellers have the upper hand this time. If this is a repeat of the almost free-fall that we saw in 2020, 2014 or 2008, the price could well plunge back into the $30 area. Near that price, most production becomes unprofitable. However, this has only happened because of a marked dysfunction in the financial markets. So far, there are no signs of this, although the situation may change quickly.

Still, the main scenario, we believe, is that oil returns to growth due to the ease with which OPEC+ can remove 0.5% of global production from the market – enough to reverse the trend. Also, we should not overlook the rise in commodity prices in recent weeks as China has increased steps to stimulate growth.

Oil Retreating But Unlikely to Repeat Collapses of 2020, 2014 or 2008_3

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Risk Warnings and Disclaimers

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Glendon

Economic

Recent News and Economic FactorsThe EUR/USD currency pair has experienced significant fluctuations recently, driven by a mix of economic data releases, central bank actions, and geopolitical developments.

Eurozone Economic Indicators

Inflation Data: The latest Eurozone inflation figures showed a slight decrease to 6.1% in April from 6.3% in March. This moderation in inflation has led to speculation about the European Central Bank's (ECB) future monetary policy decisions.

GDP Growth: The Eurozone's GDP growth for Q1 2024 was reported at 0.4%, slightly below the expected 0.5%. This slower growth has raised concerns about the region’s economic recovery.U.S. Economic Indicators:

Non-Farm Payrolls: The U.S. added 253,000 jobs in April, surpassing expectations of 180,000. This robust job growth signals a strong U.S. economy, which could influence the Federal Reserve's monetary policy.

Inflation Data: The U.S. Consumer Price Index (CPI) rose by 4.9% year-over-year in April, slightly below the expected 5%. This lower-than-expected inflation figure has fueled hopes that the Federal Reserve might slow down its interest rate hikes.

Central Bank Actions

ECB Policy: The ECB raised interest rates by 25 basis points in its latest meeting, bringing the main refinancing rate to 4.25%. However, the central bank's guidance was more dovish, indicating a possible pause in further rate hikes if inflation continues to moderate.

Federal Reserve Policy: The Federal Reserve also raised rates by 25 basis points in its May meeting, but Chairman Jerome Powell hinted at a potential pause in rate hikes, citing concerns about economic growth and financial stability.

Technical Analysis

Current Price Action:As of mid-May 2024, the EUR/USD is trading around 1.0850, after reaching a high of 1.1000 earlier in the month. The pair has faced resistance at the 1.1000 level and found support around 1.0750.

Support Levels: The immediate support is at 1.0800, followed by a stronger support at 1.0750. If the pair breaks below 1.0750, it could target the next support level at 1.0600.

Resistance Levels: The immediate resistance is at 1.0900, with a major resistance at 1.1000. A break above 1.1000 could open the door for a move towards 1.1100.

Moving Averages: The 50-day moving average is currently at 1.0855, while the 200-day moving average is at 1.0700. The pair is trading above both moving averages, indicating a bullish trend in the short to medium term.

Outlook and Key Events to WatchThe outlook for EUR/USD will depend heavily on upcoming economic data and central bank communications.

Key events to watch include:

Eurozone Economic Data: Watch for the upcoming PMI data, which will provide insights into the health of the manufacturing and services sectors. Strong PMI readings could support the euro.U.S.

Economic Data: The next U.S. jobs report and CPI data will be crucial. Strong job growth and lower inflation could boost the USD, putting pressure on the EUR/USD.

ECB and Federal Reserve Meetings: Any unexpected changes in monetary policy or guidance from either the ECB or the Federal Reserve could significantly impact the pair.

Conclusion

The EUR/USD pair is currently navigating a complex landscape of economic data and central bank actions. While the technical outlook suggests a cautious bullish trend, the pair remains vulnerable to shifts in market sentiment driven by economic releases and policy announcements. Traders should stay informed about key economic indicators and be prepared for potential volatility in the weeks ahead.

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

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Thomas

Economic

Forex

Australian Wage Growth and the RBA Rate Path

On Wednesday (May 15), Australian wage growth will impact buyer demand for the AUD/USD.

Economists forecast the Australian Wage Price Index to increase 4.2% year-on-year in Q1 2024 after advancing 4.2% in Q4 2023. Furthermore, economists expect the Index to rise by 0.9% quarter-on-quarter after a 0.9% increase in Q4.

Larger-than-expected wage growth could refuel speculation about an RBA interest rate hike. Higher wages may increase disposable income. Upward trends in disposable income could fuel consumer spending and demand-driven inflation. A more hawkish RBA rate path could raise borrowing costs and reduce disposable income.

In the recent RBA press conference, RBA Governor Michele Bullock highlighted uncertainty about household spending. Moreover, the RBA Governor poured cold water over discussions about raising interest rates. The wage growth figures could change the narrative.

Beyond the numbers, investors should monitor RBA chatter. Reactions to the Australian budget and the wage growth figures could move the dial.

However, the People's Bank of China (PBoC) will also draw interest. The PBoC will announce the 1-year Medium-Term Lending Facility (MLF) Rate. Economists expect the PBoC to leave the 1-year MLF Rate at 2.5%. An unexpected cut in the MLF Rate could influence buyer appetite for the Aussie dollar.

US Economic Calendar: US CPI Report and the Fed

Later in the Wednesday session, the all-important US CPI Report will put the Fed in focus.

Economists forecast the annual rate of inflation to ease from 3.5% to 3.4% in April. Hotter-than-expected numbers could dampen investor expectations for a September Fed interest rate hike.

A more hawkish Fed rate path would raise borrowing costs and reduce disposable income. Downward trends in disposable income could force consumers to curb spending and dampen demand-driven inflation.

However, US retail sales figures will also garner investor interest. Better-than-expected numbers may also influence the Fed rate path. Economists forecast retail sales to increase by 0.4% in April after rising by 0.7% in March. Consumer spending trends influence demand-driven inflation and Fed monetary policy goals.

Other stats include the NY Empire State Manufacturing Index and housing sector data. However, these will likely play second fiddle to the CPI Report and retail sales numbers.

With inflation and retail sales in focus, investors should also monitor FOMC member chatter. FOMC members Neel Kashkari and Michelle Bowman are on the calendar to speak on Wednesday. Reactions to the CPI Report and views on the timing of a Fed interest rate cut could move the dial.

Short-Term Forecast

Near-term AUD/USD trends will likely hinge on the US CPI Report and Australian wage growth figures. Sticky US inflation numbers could impact bets on a September Fed rate cut and tilt monetary policy divergence toward the US dollar. Nevertheless, hotter-than-expected Aussie wage growth figures could fuel bets on an RBA rate hike.

AUD/USD Price Action

Daily Chart

AUD to USD Forecast: Aussie Wage Growth and the US CPI Report in the Spotlight_1

The AUD/USD remained above the 50-day and 200-day EMAs, affirming the bullish price signals.

An Aussie dollar breakout from the $0.66500 handle could give the bulls a run at the $0.67003 resistance level. A break above the $0.67003 resistance level would support a move toward the $0.67500 handle.

Australian wage growth, the US CPI Report, US retail sales, and FOMC member commentary need consideration.

Conversely, an AUD/USD fall through the $0.65760 support level and the 200-day EMA could give the bears a run at the 50-day EMA. A break below the 50-day EMA could signal an Aussie dollar drop below $0.65.

With a 14-period Daily RSI reading of 59.00, the AUD/USD could visit the $0.67003 resistance level before entering overbought territory.

Source: FX Empire

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

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Samantha Luan

Economic

Forex

The yen languished near a two-week low, as a still-gaping yield gap between local bonds and U.S. peers continued to encourage selling of the Japanese currency.

The yuan slid to a two-week low versus the dollar after U.S. President Joe Biden unveiled steep tariff increases on an array of Chinese imports, including computer chips, fomenting tensions with Beijing.

The euro edged down 0.04% to $1.0814 in early Asian trading hours, but remained close to the overnight high of $1.09255, a level last seen on April 10.

The U.S. dollar index - which measures the currency against six top rivals, but is heavily weighted towards the euro - was flat at 105.04 after a drop to a 1 1/2-week low of 104.95 on Tuesday.

The benchmark long-term U.S. Treasury yield was little changed at 4.4472% after a 3 1/2-basis point (bp) retreat overnight.

Wednesday's report on core consumer prices is expected to show CPI rose 0.3% month-on-month in April, down from a 0.4% growth the previous month, according to a Reuters poll.

Fed Chair Jerome Powell gave a bullish assessment on Tuesday of where the U.S. economy stands, with an outlook for continued above-trend growth and confidence in falling inflation that, while eroded by recent data, remains largely intact.

Higher-than-expected consumer prices in the first quarter of the year were the driving force for a sharp repricing of the pace of Fed rate cuts, with those bets now pared back to about 45 bps of reductions this year.

Despite broad dollar weakness overnight against the majority of its peers, it continued to climb against the yen. The dollar added 0.06% to 156.535 yen on Wednesday, after pushing as high as 156.80 overnight.

In contrast to U.S. counterparts, Japanese long-term yields stand at just 0.96%, even with Bank of Japan rhetoric turning more hawkish in recent days and prospects for another rate hike in June increasing.

The dollar's surge to a 34-year peak of 160.245 yen on April 29 triggered two rounds of aggressive yen buying that traders and analysts suspect was the work of the BOJ and Japanese finance ministry.

"The BOJ will hope that tonight's U.S. CPI release is in line with expectations to avoid the need for a difficult conversation tomorrow about when the appropriate time is to commence a third round of intervention - mindful that the past two rounds have yet to turn around the yen's fortunes," Tony Sycamore, an analyst at IG, wrote in a client note.

The dollar stood at 7.2409 yuan in offshore trading, after sliding to the lowest since May 1 at 7.2460 overnight.

The Biden administration slapped China with steep tariff increases on products including chips, electric vehicle batteries and medical equipment, immediately spurring Beijing to vow retaliation. Reuters had reported the impeding levies last week.

Elsewhere, the Australian dollar rose to a one-week high of $0.6630 on Wednesday, while the New Zealand dollar climbed to a more than one-month peak of $0.6051.

Cryptocurrency bitcoin was little change at $61,636.