Aussie Economic Data Watched Amid US Labor Market Interest

Traders' Opinions

Forex

Summary:

On April 4, Australian Services PMI surged from 53.1 to 54.4. Later, attention turns to Aussie building permits and retail sales. US jobless claims and Fed speakers also grab investor focus.

Australian Retail Sales and Building Permits Take Center Stage

In the economic arena, all eyes are on Australian building permits and retail sales figures for Thursday. These data points offer valuable insights into the health of the real estate sector and consumer spending habits, respectively. Positive trends in these areas could potentially fuel inflation driven by consumer demand.

Building Permits

Analysts anticipate a 3.3% month-on-month increase in building permits for March, following a 1.0% decline in February. However, it's essential to look beyond monthly fluctuations and consider broader trends in the real estate market. Rising building permits may signal growing confidence in the economy and future construction activity.

Retail Sales

Similarly, retail sales figures provide a glimpse into consumer behavior and sentiment. A revision upwards in preliminary retail sales data could challenge expectations of a dovish stance from the Reserve Bank of Australia (RBA). A more optimistic outlook from the RBA could impact interest rates and borrowing costs, influencing disposable income and consumer spending patterns.

The Judo Bank Services PMI

Earlier in the day, the release of the Judo Bank Services PMI painted a positive picture of the Australian economy, surpassing economists' forecasts. As the services sector comprises a significant portion of Australia's GDP, improvements in this area bode well for overall economic health.

Focus on the US Labor Market

Across the Pacific, the US labor market remains a focal point for investors. Weekly jobless claims data will be closely monitored, serving as a precursor to the upcoming US Jobs Report. Any unexpected shifts in jobless claims could sway market expectations regarding future Federal Reserve interest rate decisions.

Potential Impact on Monetary Policy

A tightening labor market may lead to wage growth and increased disposable income, potentially spurring consumer spending and inflation. However, a hawkish stance from the Federal Reserve could prompt adjustments in monetary policy, affecting borrowing costs and consumer behavior.

Looking Ahead: Fed Commentary

As investors digest economic indicators, attention will also be on commentary from Federal Reserve officials. Remarks from FOMC members Barkin, Goolsbee, Mester, and Kugler could provide further insight into the Fed's policy direction and future rate decisions.

Short-Term Outlook

In the near term, the trajectory of the AUD/USD pair hinges on the outcome of the US Jobs Report and Fed communications. A stronger-than-expected report may bolster the US dollar, while hawkish rhetoric from the Fed could reinforce this trend.

Technical Analysis

Aussie Economic Data Watched Amid US Labor Market Interest_1

On the daily chart, the AUD/USD remains above the 50-day EMA but below the 200-day EMA, signaling mixed sentiments. A breakout above the $0.65760 resistance level could pave the way for further upside, while a breach below the 50-day EMA may indicate downward pressure.

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.

Add to Favorites

Chandan Gupta

Traders' Opinions

Cryptocurrency

A Closer Look at Wednesday's Movement

Wednesday saw XRP taking a 2.01% dip, following a 4.27% slide the day before, ultimately settling at $0.5740 by the session's close. The ongoing uncertainty surrounding the SEC vs. Ripple case lingered, keeping XRP in negative territory for the day.

Stuart Alderoty, Ripple's Chief Legal Officer, made waves with his response to comments from SEC Director Gurbir Grewal. Alderoty's remarks highlighted key rulings and criticized the SEC's approach to crypto regulation, showcasing the growing frustration within the US crypto community.

SEC vs. Debt Box and Ongoing Scrutiny

Meanwhile, US lawmakers remained relatively silent despite increasing scrutiny of the SEC's actions. Notably, there has been no follow-up to a co-signed letter threatening scrutiny of SEC enforcement cases, nor any reaction to news of the Office of Inspector General investigating reports of crypto conflicts of interest within the SEC. The outcome of these investigations could potentially force lawmakers to take action.

Ripple’s Launching a Stablecoin

The decision to introduce a stablecoin was reportedly made by Ripple last year. Ripple's CEO, Brad Garlinghouse, cited concerns over the "depegging" of rival stablecoins as a motivating factor. Both Tether and USDC experienced periods where their value deviated from the intended peg of $1. This instability was exacerbated by external events such as the collapse of terraUSD and revelations regarding USDC's exposure to Silicon Valley Bank.

Tether, in particular, has faced scrutiny regarding the source of its reserves and its overall financial robustness. Critics have raised doubts about Tether's ability to withstand a "bank run," questioning whether its reserves are truly sufficient. However, Tether maintains that its token is fully backed by quality reserves and has consistently been able to meet withdrawal demands, even during periods of market stress.

Garlinghouse highlighted the regulatory uncertainties surrounding the current market leader among stablecoins, without explicitly naming Tether or any other specific entity. He emphasized that Ripple is a regulated institution with licenses in several jurisdictions, including New York, Ireland, and Singapore. This positioning suggests that Ripple aims to differentiate itself by prioritizing regulatory compliance and transparency.

The introduction of Ripple's stablecoin marks a strategic move within the cryptocurrency landscape. Stablecoins, which are designed to maintain a stable value relative to a specific asset or basket of assets, have gained popularity due to their potential for facilitating seamless transactions and mitigating volatility within crypto markets. By entering this space, Ripple seeks to offer users a reliable and stable digital currency alternative.

Ripple's stablecoin launch comes at a time of increasing scrutiny and regulatory oversight within the cryptocurrency industry. Regulatory authorities worldwide have been ramping up efforts to establish clear frameworks for digital asset trading and issuance. In this context, Ripple's emphasis on regulatory compliance could serve as a competitive advantage, potentially attracting users and partners seeking a compliant and trustworthy stablecoin solution.

Analyzing XRP's Chart

From a technical standpoint, XRP remained below key moving averages, signaling a bearish trend. The 50-day and 200-day EMAs served as resistance levels, while a move above them could pave the way for a push toward the $0.6609 resistance level. Conversely, a break below the $0.5740 support level could lead to further downside movement. Ripple Legal Officer Counters SEC, Sparks Debate in XRP Community_1

Ripple Legal Officer Counters SEC, Sparks Debate in XRP Community_1

On the 4-hourly chart, XRP remained below both EMAs, reinforcing the bearish sentiment. The crossover of the 50-day EMA through the 200-day EMA added weight to the bearish outlook. However, a move above the 200-day EMA could signal a potential rally toward the $0.6609 resistance level, while a breach of the $0.5740 support level could lead to further declines.

Final Thoughts

As investors continue to monitor SEC activity and developments in the SEC vs. crypto case, XRP remains in a precarious position. While technical indicators suggest a bearish outlook, the outcome of ongoing legal and regulatory battles could significantly impact XRP's trajectory in the days to come.

Risk Warnings and Disclaimers

Add to Favorites

Chandan Gupta

Cryptocurrency

US Government Transfers $40M Bitcoin & Ethereum

The US government recently made headlines in the crypto world by transferring nearly $40 million worth of Bitcoin (BTC) and Ethereum (ETH) on April 4th. These digital assets, previously seized from two Estonian citizens in 2022, are now under US authorities' possession. This development has stirred significant interest within the crypto community, particularly given the ongoing market turbulence surrounding Bitcoin's price, which recently rebounded above $67,000.

Implications of the Massive Transfer

The transfer of these seized Bitcoin and Ethereum reserves holds significant implications for the broader crypto market. According to insights from Arkham Intelligence, the US government conducted two consecutive transfers on Thursday, one for BTC and the other for ETH. The first transfer involved 4,567 ETH valued at $15.21 million, while the second saw 374 BTC transferred, amounting to $24.80 million. These transactions have sparked speculation about their potential impact on Bitcoin and Ethereum prices.

Potential Market Impact

Many market analysts anticipate that the eventual sale of these seized crypto assets by the US government could exert downward pressure on Bitcoin and Ethereum prices. The infusion of such a substantial amount of Bitcoin into the market may trigger selling pressure, potentially exacerbating the ongoing dip in prices. Notably, a significant Bitcoin transfer by a wallet associated with the US government occurred on Tuesday morning, involving a staggering 30,175 BTC, valued at approximately $2 billion at the time.

Historical Context

This isn't the first time the US government has dealt with seized Bitcoin assets. In March 2023, they sold 9,861 BTC for $216 million, following the seizure of around 50,000 BTC associated with the Silk Road website in late 2022. Among the recent transfers, approximately 2,000 BTC were sent to a wallet linked to the crypto exchange Coinbase, while the remainder was transferred to a wallet identified as belonging to the government.

Price Rebound Amidst Market Volatility

US Government Shifts $40M Bitcoin & Ethereum Seized in 2022_2

Bitcoin's price has experienced significant volatility, dropping over 11% from its recent high of $73,750.07 before rebounding to $67,534.94 at the time of writing. This rebound, although encouraging, comes amidst a market characterized by uncertainty and fluctuating trading volumes. However, if the recent transfer by the US government signals an impending selloff, this rebound may prove short-lived.

Market Expert Insights

Market analyst Michaël van de Poppe has predicted continued consolidation in Bitcoin's price, with limited upside potential in the near term. However, he anticipates a surge in altcoin prices, potentially benefiting Ethereum despite the looming possibility of a selloff.

Ethereum's Performance and Outlook

Despite market volatility, Ethereum's price has shown resilience, experiencing a modest increase of 1.35% to $3,374.15. Ethereum's market cap stands at $404.99 billion, with trading volumes experiencing a decline of 24.82% in the last 24 hours.

Conclusion

The US government's recent transfer of seized Bitcoin and Ethereum reserves has ignited speculation and uncertainty within the crypto market. While the immediate impact remains to be seen, market participants are closely monitoring developments to gauge potential price movements and market sentiment. As the crypto landscape continues to evolve, prudent risk management and informed decision-making will be crucial for navigating the ever-changing market dynamics.

Risk Warnings and Disclaimers

Add to Favorites

Chandan Gupta

Traders' Opinions

Stocks

NASDAQ 100 Volatility Persists Amid Market Fluctuations_1

Exploring Nasdaq 100 Dynamics

The Nasdaq 100 experienced a subdued start on Wednesday, possibly attributed to market anticipation ahead of the impending jobs report. It's essential to filter out the noise amidst these fluctuations, particularly in a landscape where traders are deciphering the trajectory of interest rates in the US. The upcoming jobs report holds significant sway over market sentiment and could influence the Federal Reserve's policy stance.

Market Developments and Influences

Stocks rallied following Federal Reserve Chair Powell's reaffirmation of the likelihood of interest rate cuts later this year. The positive sentiment was further buoyed by a decline in T-note yields in response to higher-than-expected weekly jobless claims. Notably, chip stocks led the charge in the technology sector after Taiwan Semiconductor Manufacturing assured minimal impact from an earthquake in Taiwan.

Looking Ahead: Market Focus and Key Indicators

Market attention now shifts to Friday's monthly US payroll report for further market direction. Initial unemployment claims rose to a two-month high, indicating a softer labor market than anticipated. Additionally, the US trade deficit widened to its highest level in ten months, potentially impacting Q1 GDP figures.

Interest Rate Dynamics

Interest rate movements remain a key focal point for market participants. T-note yields experienced a brief decline following dovish signals from Powell and disappointing economic indicators. European government bond yields also retreated, reflecting a broader trend towards lower yields.

Market Movers and Stock Performance

Several stocks witnessed notable movements, with Conagra Brands leading gainers in the S&P 500 after reporting better-than-expected Q3 operating margins. Chip stocks, including Marvell Technology and Western Digital, surged on reassurances regarding semiconductor supply chain disruptions. Wayfair and Synchrony Financial also recorded gains following positive analyst upgrades.

Technical Analysis and Market Outlook

Technical analysis suggests support around the 17,775 level, reinforced by the 50-day exponential moving average (EMA). While short-term volatility may persist, the longer-term trend for the Nasdaq 100 remains bullish. However, concerns regarding interest rates linger, contributing to market uncertainty.

Expectations for the Coming Days

Anticipate a choppy trading environment in the near term, with heightened volatility likely towards the end of the week. A break above current highs could propel the Nasdaq 100 towards the 18,500 and 18,700 levels. Nevertheless, sustained momentum may face challenges amid concerns of market concentration and the cyclicality of Wall Street's "bust and boom" cycle.

Risk Warnings and Disclaimers

Add to Favorites

Chandan Gupta

Traders' Opinions

Commodity

Gold Market's Historic Bullish Run

This week marks a historic milestone for the gold market, characterized by an unprecedented surge in prices. Despite the strengthening of the US dollar, gold prices have soared towards a new psychological resistance level of $2,300 per ounce. Notably, gains have extended to reach the pinnacle of $2,305 per ounce, setting a new record in the history of gold prices. This remarkable ascent spans six consecutive days, fueled by investor optimism following Federal Reserve Governor Powell's recent statements.

Federal Reserve Policy and Market Sentiment

Governor Powell's remarks have played a pivotal role in shaping market sentiment. He hinted at the likelihood of a US interest rate cut "sometime this year" if economic conditions unfold as anticipated. This has heightened expectations for a Fed rate cut in June, with markets currently pricing in a 63% chance of such an occurrence. Additionally, mixed economic indicators, including a slowdown in US service sector growth and upbeat ADP employment figures, have influenced market dynamics.

Gold's Resilience Amidst Geopolitical Tensions

Gold prices have surged by over 11% in 2024, driven by robust demand for safe-haven assets amidst escalating geopolitical tensions in regions such as the Middle East and Ukraine. This flight to safety has bolstered gold's status as a preferred investment avenue in times of uncertainty, underpinning its bullish trajectory.

US Stock Market Dynamics

Against this backdrop, US stock market indices experienced mixed performance, with the S&P 500 and Nasdaq edging higher while the Dow Jones index endured a three-day losing streak. Investors closely monitor Federal Reserve Chairman Powell's comments regarding future monetary policy, particularly his emphasis on achieving a "soft landing" amidst rising interest rates.

Outlook for Gold Prices

Analyzing the daily chart, gold's upward momentum remains robust, with technical indicators signaling strong buying saturation levels. However, market participants anticipate profit-taking selling operations, particularly if the US dollar gains traction amid stronger-than-expected employment figures. Nonetheless, a reversal of the uptrend is unlikely without a move towards the $2100 and $2000 levels, underscoring the resilience of gold amidst shifting market dynamics. Gold Shatters Historical Resistance, Paving the Way for Potential New Highs_1

Gold Shatters Historical Resistance, Paving the Way for Potential New Highs_1

In Conclusion

The gold market's record-breaking performance underscores its enduring appeal as a safe-haven asset amidst geopolitical uncertainties and evolving monetary policy landscapes. While near-term fluctuations may occur, the overarching bullish sentiment reflects investor confidence in gold's intrinsic value and resilience. As market participants navigate these dynamics, prudent risk management and strategic positioning remain paramount to capitalize on opportunities and mitigate potential risks in the ever-changing landscape of financial markets.

Risk Warnings and Disclaimers

Add to Favorites

Zi Cheng

Economic

The UK’s broad measure of money supply continued to fall at the start of 2024, leaving economists who follow the measure warning against any brisk bounce back from a recession that hit last year.

Bank of England data out this week showed that a closely watched measure of M4 money supply declined in the first two months of 2024, sinking 1.1% in February compared to a year ago. The UK is also trailing the bounce backs in money supply seen in the US and eurozone.

The figures are concerning for monetarists, who foresaw both a double-digit surge in inflation and the UK’s technical recession by tracking money supply. While mainstream economists and the central bank anticipate a gentle improvement in the UK economy this year, monetarists are more cautious.

Source: Bank Of England

“The numbers need to improve further to warrant sounding the all-clear,” Simon Ward, economic adviser to Janus Henderson, said in an interview. “The first quarter could show a small recovery, but the continued weakness of monetary trends suggests significant risk of a subsequent relapse.”

He and colleagues including Tim Congdon, founder of the Institute of International Monetary Research, see growth and inflation as driven by the quantity of money in circulation and its velocity — how many times it changes hands. The measure gained popularity as a forecasting tool in the 1980s and 1990s but has since fallen out of favor, with economists increasingly relying on surveys of activity and consumer attitudes instead.

Many mainstream economic indicators have pointed to a brightening picture for the UK in recent months, but the money supply data has remained stubbornly lackluster, with only a small pick-up from the final months of 2023.

M4 excluding intermediate other financial corporations — a closely watched measure of money supply — slipped 1.6% year-on-year in January and 1.1% in February, according to BOE data. While that’s an improvement on last year’s tumbles, February still marked the eighth consecutive contraction.

“The six-month rates of change of real broad and narrow money ... are still negative,” said Ward. He is particularly concerned about the “continued weakness of corporate money trends,” which suggest that some companies are under pressure to cut jobs and investment.

Source: Office for National Statistics

Central bankers have played down the significance of the money supply data, though the successful predictions by the unorthodox monetarists have prompted calls for the BOE to watch the figures more closely.

Money supply shot up shortly before inflation surged and hit a high of more than 11% in late 2022. It then collapsed and contracted for the first time in at least 13 years, prompting warnings of recession including from former BOE Governor Mervyn King. Official data has since confirmed that the UK suffered a shallow technical recession in the second half of last year.

Ashley Webb, UK economist at Capital Economics, said the “negative annual growth rate in M4ex leaves the UK looking like a bit of an outlier” compared to rising money supply in the eurozone and the US.

However, he cautioned that the recent trend has been more positive than the annual rate suggests, pointing to recent growth on a three-month annualized basis.

“The relationship between money growth and CPI inflation isn’t very strong,” Webb said. “But at face value the annual growth rate in M4ex points to further falls in UK CPI inflation, to just above zero in around 18 months time.”BOE Chief Economist Huw Pill recently conceded that it needs to take a “broader approach” to its forecasts, including delving into the money supply figures. A review by former Federal Reserve chair Ben Bernanke into the BOE’s forecasts is due on April 12 after the central bank was criticized for failing to anticipate the scale and persistence of the inflation shock.

Source: Bloomberg

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

Risk Warnings and Disclaimers

Add to Favorites

Zi Cheng

Economic

In the world’s biggest bond market, there’s a growing sense that the benchmark 10-year yield is set to revisit the 4.5% level last seen in November before a massive year-end rally kicked in.

A key US job-market report Friday is the next hurdle for investors, who have been ratcheting back expectations for the degree of Federal Reserve policy easing they see this year, given the economy’s resilience and sticky inflation. They’re also starting to anticipate fewer rate cuts in the coming cycle, which is guiding 10-year Treasury yields up as well, according to ING Financial Markets.

Overall, the “no landing” view on the economy is beginning to take hold in the bond market, says Michael Darda at Roth MKM.

Source: Bloomberg

The 10-year Treasury yield has risen about 14 basis points this week to around 4.34%, after reaching 4.43% Wednesday, the highest since November. In the options market, traders were targeting a move to almost 4.5% by the end of this week, with trades in derivatives Wednesday generally skewed toward hedging against higher yields.

It’s “tough to stand in the way of the 10-year heading to 4.5%,” Padhraic Garvey, head of global debt and rates strategy at ING Financial Markets, said in a note dated April 3.

For investors, the 4.5% level is significant psychologically, with some seeing it as an area where they’d step in to put money to work. The yield is up more than 40 basis points from the end of 2023.

Data Wednesday showed US companies boosted hiring last month by the most since July and some wage gains accelerated. Government figures to be released Friday are projected to show an increase of about 213,000 nonfarm jobs last month, following a 275,000 gain in February.

CPI Ahead

Potentially even more crucial for the path of yields, next week brings data on March core consumer prices, which are forecast to have risen at a 3.7% annual pace, compared with February’s 3.8% level.

Forecasts for the US CPI, “if confirmed, would suggest that the US is not a 3% inflation economy but is in fact closer to being a 4% one,” Garvey and his colleagues wrote.

Fed officials in March lifted their outlook for the long-run policy rate to 2.6% from the 2.5%, according to the median projection. They also maintained their outlook for three rate cuts this year. Swaps traders currently put roughly even odds on an initial Fed cut in June, and pricing suggests they see a chance of fewer than three reductions this year.

Treasury yields dipped in early trading Thursday, suggesting some investors were taking the latest increase in yields as an opportunity to buy.

Michael Gladchun at $335 billion asset manager Loomis, Sayles & Co. is in that camp. He and his colleagues expect three to five Fed rate cuts this year, helping push the 10-year yield down to the 3.8% to 3.9% range in about six months.

As yields “have backed up again up towards the high levels, we have been buyers of the dip,” said Gladchun, a co-portfolio manager for the firm’s active US Treasury strategies and also co-leader of the US yield curve sector team.

Source: Bloomberg

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

Risk Warnings and Disclaimers

Add to Favorites

Recent Searches

Top Searches

Markets

News

Analysis

User

24/7

Economic Calendar

Education

Data

Aussie Economic Data Watched Amid US Labor Market Interest

Australian Retail Sales and Building Permits Take Center Stage

Building Permits

Retail Sales

The Judo Bank Services PMI

Focus on the US Labor Market

Potential Impact on Monetary Policy

Looking Ahead: Fed Commentary

Short-Term Outlook

Technical Analysis

Ripple Legal Officer Counters SEC, Sparks Debate in XRP Community

A Closer Look at Wednesday's Movement

SEC vs. Debt Box and Ongoing Scrutiny

Ripple’s Launching a Stablecoin

Analyzing XRP's Chart

Final Thoughts

US Government Shifts $40M Bitcoin & Ethereum Seized in 2022

US Government Transfers $40M Bitcoin & Ethereum

Implications of the Massive Transfer

Potential Market Impact

Historical Context

Price Rebound Amidst Market Volatility

Market Expert Insights

Ethereum's Performance and Outlook

Conclusion

NASDAQ 100 Volatility Persists Amid Market Fluctuations

Exploring Nasdaq 100 Dynamics

Market Developments and Influences

Looking Ahead: Market Focus and Key Indicators

Interest Rate Dynamics

Market Movers and Stock Performance

Technical Analysis and Market Outlook

Expectations for the Coming Days

Gold Shatters Historical Resistance, Paving the Way for Potential New Highs

Gold Market's Historic Bullish Run

Federal Reserve Policy and Market Sentiment

Gold's Resilience Amidst Geopolitical Tensions

US Stock Market Dynamics

Outlook for Gold Prices

In Conclusion

Britain's Falling Money Supply Clouds Chance of a Brisk Rebound

Source: Bank Of England

Source: Office for National Statistics

Source: Bloomberg

US 10-Year Yield Is Set to Revisit 4.5%, ING Financial Says

Source: Bloomberg

CPI Ahead

Source: Bloomberg

Risk Disclosure