The United States has one week before default, and NVIDIA may become the next Tesla. What else drives the market?
Stocks surged at the start of the week
Stocks and riskier currencies started the week on the positive footing as traders are focused on the prospect of Biden’s extra fiscal stimulus and supportive Federal Reserve policy amid the rising virus cases. The US dollar is heading down at the start of the day.
Nasdaq 100 is rallying up above its record highs ahead of tech earnings reports this week. S&P 500 is getting close to set the all-time high as well. As I’ve already mentioned, stocks are rising because of Biden’s expansive spending and the massive vaccines rollout.
US lawmakers are still arguing over Biden’s proposed $1.9 million, but investors expect the stimulus is going to be unveiled soon. Besides, traders await Fed Chair Jerome Powell will confirm on Wednesday that the central bank will continue buy bonds at the current pace during the meeting.
EUR/USD has been rising since morning, but the further rally is limited by the 200-peiod moving average at 1.2190. Elsewhere, the 50-period moving average(MA) is going to cross the 200-period MA from the top down, forming a dead cross, which signals the further falling. So, we can expect that the pair will pull back from 1.2190 and drop to the support of 1.2140 at the recent lows and the 50-day MA.
GBP/USD is trading in an ascending channel. It gets closer to the high of January 21 at 1.3740 which lays also at the upper line of the Bollinger Bands indicator. It’s more likely to pull back from this resistance rather than break it out as it has failed to do so a few times already. Once it crosses it, the way up to 1.3800 will be open. Support levels are at the 50- and 100-period MA of 1.3650 and 1.3625.
Gold is flirting with the $1 850 level. If it manages to break it down, the doors towards the 23.6% Fibonacci retracement at $1 840 will be open. On the flip side, the move above the 200-period MA of $1 870 will drive the yellow metal to the 38.2% Fibo level at $1 885.
USD/JPY is moving down as if we look at the daily or the 4-hour chart. The downside is limited by the 200-period MA at 103.65. We would expect the pullback to the upside rather than breakout as the pair has failed to cross it many times this month. Once the yen crosses it, the way down to the next support at 103.50 will be open.
Economic news to follow:
China’s CB Leading Index at 16:00 MT time.
ECB President Lagarde will hold a meeting at 18:15 MT time.
Some progress in US debt ceiling talks is made, and the PMI data is out.
When will the US go bankrupt? Will it start the market crash unseen before? We have plenty to share with you, so let’s get started.
About 24% of global central banks intend to increase gold reserves in 2023. Rising inflation, geopolitical turmoil, and worries about interest rates are reasons to increase gold reserves.
Greetings to a brand new week full of events, economic releases and US debt frictions. We are here to tell you everything you need to know!
The US dollar index breaks one resistance after another. Read the report to learn the next target for the US dollar index!