Easter may be coming, but there’s still plenty of action on the global economic scene – Market Overview

Easter may be coming, but there’s still plenty of action on the global economic scene – Market Overview

The most notable change in the market since yesterday is the strengthening of the U.S. Dollar.

Behind this strength of the North American currency is the continuous rise of U.S Bond yields. Yesterday, the 10-year bond hit a new high of 1.77%. And although yields fell slightly, the trend continues, pointing towards levels close to or above 2% in the case of the 10-year bond.

The yield differential between American bonds and those of the rest, especially European ones, is widening day by day. This is providing a solid push for the U.S. Dollar against all counterpart currencies.

Today, the ECB President Christine Lagarde made statements indicating that they will continue to maintain low-interest rates. This seems a clear warning to the markets that they will not let European bond yields be affected by the uptrend of U.S. bonds.

Data from the North American economy support these movements with apparent signs of a rapid recovery that is significantly ahead of the European economy's evolution. The vaccination rate in the United States, well above the European rate, also contributes significantly to this economy's better performance.

Today the ADP Nonfarm Employment Change data is published with an expected figure of 550k. If this confirms, it could positively encourage the markets. In turn, it could signal a rise in interest rates and a strengthening of the U.S. Dollar.

Moreover, this figure is usually seen as an indicator of Friday's figure, the Non-Farm Payrolls Report, which could significantly influence the markets.

In this bullish scenario for the North American currency, the dollar index has already managed to overcome the Fibonacci retracement levels of the last bearish leg that began in September 2020, as we can see in the daily chart. It is now heading towards the reference levels between 94.22 and 94.70, above which the downtrend that began in early 2020 would be over.

A strong Dollar due to long-term interest rate rises could negatively affect the stock markets with a possible increase in risk aversion. In this hypothetical scenario, a vulnerable currency would be the Australian dollar.

The technical formation of the AUD/USD pair is interesting. A head-shoulder whose neckline has been exceeded is currently making a pullback, potentially targeting the 0.7270 zone.

Sources: Investing.com, Bloomberg.

Maklumat/penyelidikan ini disediakan oleh Miguel Ruiz (“tpenganalisis penyelidikan”) dan tidak mengambil kira objektif pelaburan tertentu, keadaan kewangan atau keperluan khusus individu. Penganalisis penyelidikan bertanggungjawab terhadap kandungan laporan penyelidikan ini, samada sebahagian atau keseluruhannya, memperakui bahawa pandangan mengenai syarikat dan sekuriti mereka yang dinyatakan dalam laporan ini jelas mencerminkan pandangan peribadi dan pedagang bertanggungjawab sepenuhnya ke atas risiko mereka sendiri.

Penyelidikan yang disediakan bukanlah pandangan JME Financial Services (Pty) Ltd ataupun undangan untuk melabur dengan JME Financial Services (Pty) Ltd. Penganalisis penyelidikan juga memperakui bahawa tiada sebahagian daripada pampasannya, adalah, atau akan, secara langsung atau tidak langsung, berkaitan dengan cadangan atau pandangan tertentu yang dinyatakan dalam laporan ini.

Sehingga tarikh laporan diterbitkan, penganalisis penyelidikan dan pasangannya dan/atau saudara-mara yang bergantung kepada penganalisis penyelidikan, tidak memegang kepentingan dalam sekuriti yang dicadangkan dalam laporan ini (“kepentingan” termasuk pemilikan langsung atau tidak langsung terhadap sekuriti).

Penganalisis penyelidikan tersebut bukanlah di bawah JME Financial Services (Pty) Ltd. Anda digalakkan mendapatkan nasihat daripada penasihat kewangan bebas mengenai kesesuaian pelaburan, di bawah penglibatan berasingan, seperti yang anda anggap sesuai dengan objektif pelaburan tertentu anda, keadaan kewangan atau keperluan kewangan tertentu sebelum membuat komitmen untuk melabur.

Undang-undang Republik Afrika Selatan akan mengawal sebarang tuntutan yang berkaitan dengan atau yang timbul daripada kandungan maklumat/ penyelidikan yang disediakan.

JME Financial Services (Pty) Ltd, beroperasi sebagai ZA.CAPEX.COM, bertindak sebagai perantara antara pelabur dan Magnasale Trading Ltd, rakan kontrak untuk perbezaan yang dibeli oleh pelabur melalui ZA.CAPEX.COM, yang diberi kuasa dan dikawal selia oleh Cyprus Securities. dan Suruhanjaya Pertukaran dengan nombor lesen 264/15. Magnasale Trading Ltd adalah prinsip utama CFD yang dibeli oleh pelabur.