Today's inflation report on PPI came in lower than expected, indicating a decline in the rate of inflation overall. In the FOMC meeting minutes, the Fed expects to hike again in May. The market is taking in this news as well as mixed economic data. The dollar tumbled as a result, and gold is on the rise.
Gold remains bullish at a +3 buy rating, however, the latest inflation and unemployment rates came in lower and the score shows a weaker reading. On a technical reading, gold's trend is forecasted to go upward in the short term as April is a positive month for the metal. Retail is very short gold while institutions continue to pour money into the long side.
Now that the Fed is looking to hike once again in May, we'll have to keep an eye on COT data this Friday to capture some insight on where the metal could go. Although the dollar looks extremely weak as of late, smart money could be buying into the dip as inflation comes down and interest is expected to hit 5.25% next month.
USOil jolted higher as fears of recession build in the US economy. OPEC meetings last week mentioned a surprise cut in oil production leading the commodity's price higher. Oil broke above a significant level of resistance around the 81.90s. Yesterday's close above that level was a promising sign for the bulls.
At the same time, USOil's EdgeFinder score has flipped from a strong sell to a neutral reading. The main drivers for this score are mostly technicals as COT is heavily interested in the commodity and the trend reading is stronger to the upside.
Strong buy on CHFJPY at +7. Retail wants this pair to drop while COT has a slight bullish bias towards Swiss. The next three months are historically bullish on a 10 year average, and the trend reading displays a nice steady trend to the upside.
CHF beats the Yen in almost all categories of fundamentals, however. With a higher interest rate, lower unemployment, less inflation, and similar GDP growth, Swiss is comparatively stronger.
Retail is strongly against gold while mixed with oil. The crowd has been mostly against these commodities for some time although price continues to push higher. Since April began, oil's price has gone up by over 4.50% and gold has risen nearly 4%.
Smart Money Spotlight
Smart money is not liking the indices right now, but they are interested in metals and oil. Silver, platinum, gold and oil are all 60-80% bought by the big players while SPX and NAS are 40% or less. Judging by this behavior, institutions are looking to be preparing for more economic uncertainty.
Inflation data is reportedly lower for most currencies except the British pound who's inflation is not cooling down. The US reported PPI rate this week which came in lower than expected. Falling inflation rates are a good sign for the global economy, however, the dollar continues to tumble.
Save time looking for setups with the EdgeFinder's watchlist! In a glance, see the EdgeFinder's current top buys and top sells.
Gold is up nearly half a percent today while USD down a third of one as of 10:18 am EST. As we wait for the upcoming and looming NFP numbers this Friday, we can assess the economic data we already have. EdgeFinder Analysis The stock market sighed in relief after the debt ceiling bill finally […]
The dollar flew higher last week as a result of resilient economic news along with a higher PCE than expected. Now the DXY has reached a decision point in price action. This week's NFP will help determine the sentiment around the potential June rate hike. Here is what we are looking at: EdgeFinder Analysis USDCAD […]
Considerably dovish news from central banks in the US and New Zealand has caused a major stir in the markets. Governor Orr and Vice Chairman Powell both released some reassuring news for the economy in the long term. But what does this mean for USD and NZD? EdgeFinder Analysis GBPNZD is a pair that should […]
DISCLAIMER: All comments made by TraderNick’s Forex Group, LLC are for educational and informational purposes only. All comments should not be construed as investment advice regarding the purchase or sale of any securities or financial instrument of any kind. Please consult with your financial adviser before making an investment decision regarding any securities or financial instruments mentioned by TraderNick’s Forex Group, LLC. TraderNick’s Forex Group, LLC assumes no responsibility for your trading and investment results. All information on any of the platforms utilized by TraderNick’s Forex Group, LLC was obtained from sources believed to be reliable, but we do not warrant its completeness or accuracy, or warrant any results from the use of the information. TraderNick’s Forex Group, LLC, its employees, representatives, and affiliated individuals may have a position or effect transactions in the securities and financial instruments herein and or otherwise employ trading strategies that may be consistent or inconsistent with the provided strategies. Trading of any type involves very high risk and may not be suitable for all investors. TraderNick’s Forex Group, LLC, its subsidiaries and all affiliated individuals assume no responsibility for your trading and investment result. Read our full disclaimer here