HFMarkets (hfm.com): New market analysis services.

[HFM]

Date: 7th February 2025.


Global Currency Market Analysis: Key Drivers and NFP's Impact.


The Japanese Yen, Canadian Dollar, and Australian Dollar have performed well throughout the week. However, today, the US will release the NFP Employment Change, Average Salary Growth, and Unemployment Rate. As a result, most currencies are likely to witness high volatility throughout today’s US session.


US Dollar


The US Dollar may seem like the worst-performing currency of the week. However, traders should note on Monday the currency opened on a gap measuring more than 1%. Therefore, the US Dollar is only trading 0.60% lower this week and that can easily change with the release of today’s NFP data.


Analysts expect the Non-Farm Payroll figure to read 169,000 which is lower than the 256,000 from the previous month, but more or less, at the average of the past 6 months. The Unemployment Rate is expected to remain at 4.1% and the Average Salary Growth at 0.3%. If the NFP data reads higher than expectations, the US Dollar can quickly increase in value. Particularly, if the unemployment rate falls to 4.00%.


Chicago Fed President Austan Goolsbee warned that higher trade tariffs could drive inflation. Fed Vice Chair Mr Jefferson added that interest rates should stay unchanged until the full effects of Trump's policies. Mr Jefferson is mainly focusing on the effects of tariffs, immigration, and taxes.


British Pound


The British Pound was the worst-performing currency of the day on Thursday due to pressure from the Bank of England. The downward pressure came from the Monetary Policy Committee. Two members of the board, Catherine Mann and Swati Dhingra, supported the adjustment of the cost of borrowing by 50 basis points. Previously, analysts expected only 1 vote. In addition to this, no member took a hawkish stance which also put pressure on the GBP.


The Bank of England also made adjustments to the UK Gross Domestic Product to illustrate a weaker outlook. Analysts also expect inflation to rise in the UK due to increases in national insurance contributions. For this reason, many traders currently hold a bearish bias towards the GBP. The current support level for the GBPUSD can be seen at 1.23567 which is currently 0.65% lower than the current price. However, the exchange rate will mainly be driven by the US Dollar throughout the day.


Japanese Yen


The Japanese Yen is the best-performing currency of the week adding more than 2.10% to the JPY Index. The main price driver pushing the JPY higher is the Bank of Japan’s monetary policy and recent hawkish comments.


Bank of Japan member Mr Tamura stated that the BoJ should raise interest rates to at least 1% by the second half of 2025. He cited ongoing inflation risks, with companies continuing to pass rising raw material and labour costs onto consumers. Tamura warned that if short-term interest rates stay below the neutral level, inflation will likely accelerate further.


The hawkish comments continue to positively influence the Japanese Yen, the best-performing currency of 2025 so far. Many investors are looking to increase their exposure to the Yen, attracted by its safe-haven status and its current low value, which remains 14% below its 2022 level. Check out which Japanese Yen pairs are tradable here!


Key Takeaway points:


* Top Currencies: The Japanese Yen, Canadian Dollar, and Australian Dollar led the week, but US NFP data may shake up rankings.
* US Dollar: Despite a mixed performance, a strong NFP report could reverse losses, especially if unemployment drops to 4.0%.
* British Pound Pressure: The BoE's dovish stance and GDP outlook weighed on the GBP, with traders maintaining a bearish bias.
* Japanese Yen Strength: Hawkish BoJ comments and inflation concerns fueled a 2.10% JPY rally, attracting investors seeking a safe-haven asset.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.


Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work.


Michalis Efthymiou
HFMarkets


Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFM]

Date: 6th February 2025.


Analysts Expect the BoE To Cut GDP Forecasts and Raise Inflation Projections!


At 12:00 GMT, the Bank of England will reveal its latest rate decision, with economists anticipating some changes. Analysts expect the changes to spark volatility in the Great British Pound and the FTSE100 throughout the day. Currently, the GBP Index is trading lower, but what can traders expect from the BoE and what will it mean for the British Pound?


What to Expect from the Bank of England?


Analysts predict officials will lower the interest rate by 25 basis points to 4.50% and downgrade economic growth forecasts, signaling a continued “dovish” stance. Overall, borrowing costs could decrease by 85 basis points this year. Today’s interest rate cut will be the UK’s first rate adjustment since September 2024. The interest rate decision itself will have a limited effect on the GBP as the adjustment has already been priced in the market.


The price movement will largely depend on the Bank of England's adjustments to their predictions for GDP in 2025, inflation expectations and the Monetary Policy committee votes. Analysts expect the committee to have eight members vote for rate cuts and one to vote for a pause. Even if one member votes for a different adjustment, the GBP may experience higher volatility.


The Bank of England may also amend their expectations for 2025 to indicate lower growth and higher inflation. Many UK economists believe the BoE will cut the UK’s Gross Domestic Product projections from 1.5% to 1.00%. Higher inflation is also likely to be a key part of today’s BoE press conference as higher national insurance contributions are likely to trigger higher inflation and lower consumer demand.


GBPUSD - The US Dollar On the Round?


The British Pound is not witnessing any significant decline in value as the Bank of England rate decision approaches. However, the GBP Index is trading 0.25% lower largely due to the US Dollar which is rebounding after declining for 3-days. The price movement of the US Dollar will largely depend on tomorrow’s employment data and any further decisions on tariffs.


President Donald Trump approved a 25.0% tariff on Mexican and Canadian goods starting on February 1st, but implementation was delayed after agreements were reached. Canada and Mexico reportedly committed to stricter border controls. Markets have since shifted focus to potential tariffs on EU imports, though no decisions have been made.


In response, the European Commission announced plans for retaliatory measures, despite the risk of worsening global trade conditions. Meanwhile, Morgan Stanley analysts revised their monetary policy forecast, now expecting just one 25-basis-point rate cut instead of two. They believe Trump's tariff policies will drive inflation higher, limiting further adjustments in the near term.


Any statements or decisions on tariffs are likely to spark volatility and may benefit the US Dollar. The same applies to tomorrow’s employment data: NFP Employment Change, Salary Growth and the US Unemployment Rate. If the data indicate a stable and resilient employment sector, the US Dollar can rise further. Currently, the US 10-Year Treasury trades 17 points higher which can also support the USD if the yields continue to rise throughout the day.


GBPUSD - Technical Analysis


The price of the exchange rate (GBPUSD) is trading downwards towards the main trendlines and the average price. The current bearish swing has corrected the previous impulse wave and the GBPUSD now trades at the support level. If the price drops below the previous low at 1.24613, the price movement would indicate a potential change in trend in favour of the Dollar. However, this would also depend on the BoE, NFP and tariffs.


Key Takeaways:


* The BoE is set to cut rates to 4.50%, with possible GDP and inflation downgrades for the UK.
* GBP and FTSE100 volatility hinges on BoE statements, policy votes, and 2025 projections. The GBP index trades lower as the US Dollar regains momentum.
* The USD rebounds after a three-day dip, driven by potential tariffs and NFP data.
* If the GBPUSD drops below 1.24613 could signal a bearish shift.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.


Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work.

Michalis Efthymiou
HFMarkets


Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFM]

Date: 5th February 2025.


Stock Market Drops as US-China Trade War Escalates; Gold Hits Record High.


Futures for US and European stocks retreated, shrugging off gains in Asian markets as investors assessed the latest earnings from Wall Street tech giants and growing concerns over the US-China trade war.


Gold prices soared to an all-time high, continuing a nearly 1% rally from the previous session, as escalating trade tensions drove demand for safe-haven assets.


Global Stock Market Performance


* Euro Stoxx 50 futures declined 0.4%, while S&P 500 futures slipped 0.5%, weighed down by post-market declines in Alphabet Inc. and Advanced Micro Devices Inc.
* Asian stock markets advanced for a second straight session, though Chinese equities fell as the market reopened after the Lunar New Year holiday.
* The yen strengthened against the US dollar, while gold surged on increased risk aversion.


Tech Stocks and Trade War Concerns


Asian technology stocks mirrored their US counterparts’ gains, but investor sentiment toward China remained cautious. Markets reacted to Beijing’s swift but measured retaliation after the US imposed a 10% tariff on all imports from China. Compared to the aggressive tit-for-tat measures during Trump’s first term, President Xi Jinping appears to be taking a more calculated approach.


US Jobs Report and Federal Reserve Rate Policy


* The US 10-year Treasury yield declined alongside the US dollar index, after data revealed a larger-than-expected drop in job openings for December, hitting a three-month low.
* The weaker US labour market data reduced fears of aggressive Federal Reserve rate hikes, pushing the US dollar lower and creating a favourable setup for Asian markets.
* Investors now turn to the US ISM services report for further clues on the Fed’s rate policy, with analysts expecting a slowdown in activity due to winter storms and wildfires.


Trump Signals No Urgency for US-China Trade Talks


President Donald Trump told reporters he’s in no rush to negotiate with Chinese President Xi Jinping, stating that he’ll engage in discussions “at the appropriate time.”


Market analysts are concerned that prolonged uncertainty over trade negotiations could lead to increased stock market volatility, especially in China. Despite the delays in trade talks, Trump has shown that he is willing to negotiate, so markets will continue to watch closely.


In a surprising move, the US Postal Service temporarily suspended international shipments from China and Hong Kong. While the reason remains unclear, the suspension follows Trump’s repeal of the de minimis rule, which previously allowed small Chinese shipments under $800 to enter the US duty-free.


US-China trade tensions remain a major market risk and if both sides delay their tariff measures, markets will respond positively, but further escalation could trigger renewed volatility.


Gold Prices Surge as Investors Seek Safe Havens


* Gold prices skyrocketed to a record high of $2,861 an ounce, fueled by concerns over trade disputes, geopolitical instability, and potential inflation risks.
* Beijing’s measured response to US tariffs was notably softer than its previous retaliatory actions, yet investors remain cautious about its long-term effects on global trade and monetary policy.
* Adding to market uncertainty, Trump proposed a US-led reconstruction plan for Gaza, further fueling demand for safe-haven assets like gold.
The gold market is benefiting from rising geopolitical risks, including US-China trade uncertainty and tensions in the Middle East. Regardless of US dollar movements, gold demand remains strong.


US Dollar Weakens Amid Market Uncertainty


* The US dollar continued to weaken, extending Tuesday’s 0.7% drop following disappointing US jobs data.
* A weaker dollar generally boosts gold and commodity prices, making them more affordable for international buyers.
* Spot gold gained 0.7%, trading at $2,861.22 per ounce as of 6:29 a.m. in London. Meanwhile, silver and platinum also advanced, while palladium declined.


Even before the latest US-China tariffs, the precious metals market was experiencing heightened volatility.


* Gold and silver prices in the US surged above international benchmarks, leading to a rush of large-scale shipments into the country ahead of potential tariffs.
* The uncertainty also caused a spike in lease rates for gold and silver, as traders scrambled to secure short-term loans for metals stored in London vaults.
* Crude oil prices slipped, as global growth concerns stemming from the trade war overshadowed the impact of new US sanctions on Iran.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.


Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work.


Andria Pichidi
HFMarkets


Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFM]

Date: 4th February 2025.


The British Pound Remains Resilient Amid USD Strength!


This week, the Great British Pound is one of the best-performing currencies against the US Dollar. The US Dollar saw strong gains during Monday’s Asian session but was unable to maintain momentum due to Trump pausing tariffs on Canada and Mexico for 30 days. Why is the GBP performing better than the Euro and other currencies?


0Why Is The British Pound Holding Strong Against The Dollar?


The British Pound is strengthening due to President Trump's favourable stance toward the UK. Economists advise the UK is still at risk of tariffs in the next 4-years, but are not likely to be imminent. President Trump has announced tariffs on China, Mexico and Canada. Tariffs on Mexico and Canada have been postponed but stated Tariffs on the EU are almost certain. Therefore, the GBP has benefited from being left out of President Trump’s blacklist for now.


Therefore, the GBP’s bearish price movement is weaker than that seen amongst other currency pairs. The GBP index this week is trading 0.22% lower but is still performing better than other currencies. The worst-performing currency of the past week is the Euro and the JPY is the best-performing along with the GBP. Economists advise the GBP may be able to benefit from global tariffs being put on partners as long as the US does not impose tariffs on the UK.


In addition to this, the price movement of the Pound will also depend on monetary policy. The Bank of England's meeting is scheduled for Thursday at 14:00 (GMT+2). The regulator is expected to lower the interest rate by 25 basis points to 4.50%. This decision is driven by inflation concerns linked to the US Republican administration's trade policies. As a result, the GBP is also gaining support from the BoE, which remains cautious about reducing rates too quickly. In December, consumer prices rose 2.5% year-on-year, below analysts' expectations, nearing the 2.0% target.


Meanwhile, the services CPI dropped sharply from 5.0% to 4.4%. However, rising energy costs could drive inflation higher. Additionally, UK Chancellor of the Exchequer Rachel Reeves' decision to raise employers' National Insurance contributions, along with minimum wage indexation, has increased labour costs. This could, in turn, impact household spending.


Why Did the US Dollar Lose Momentum?


The gains seen during Monday’s Asian Session were in response to tariffs on Mexico, Canada and China. However, tariffs on Mexico and Canada have been put on hold as both nations have said they are willing to provide 10,000 soldiers at their borders to stop drug trafficking and immigration. As the pause was announced, the US Dollar started to retreat as traders took advantage of the higher price to cash in their profits.


Experts now point out that the tariff increases will impact half of all imports. Reducing reliance on external suppliers would require doubling domestic production, an unfeasible goal in the short term, potentially leading to a significant rise in consumer prices.


As a result, Federal Reserve officials may be compelled to maintain the current policy for an extended period. Depending on inflation, the Fed may even consider tightening the policy if inflation rises. Against this backdrop, analysts have lowered their expectations for two interest rate cuts this year to 54.0%, according to the Chicago Mercantile Exchange (CME) FedWatch Tool. President Trump acknowledged the potential negative effects of his actions but expressed confidence that no drastic consequences would occur.


GBPUSD - Forecasts and Technical Analysis!


The fundamental outlook for the UK is not likely to change this week, but for the US Dollar, the latest developments will likely change on a daily basis. Particularly, investors will be focusing on further comments on Tariffs, earnings data and this week’s employment data. If earnings data from Alphabet and Amazon are weaker than expectations and trigger a lower risk appetite, the US Dollar as a safe haven asset may increase in value.


Investors will also monitor this week’s JOLTS Job Openings, ADP Employment Change, Salary Growth and NFP Employment Change. If the employment data again reads higher than the current expectations, the Federal Reserve will likely be less tempted to cut interest rates any time soon. Consequently, the GBPUSD may fall as the BoE simultaneously cuts interest rates for the first time in 2025.


If the price falls below 1.23777, the exchange rate will form a breakout and drop below most moving averages on the 2-hour chart. In addition to this, with a bearish momentum of 0.32%, the decline is also likely to bring the RSI below the 50.00 level. If this materialises, the price may witness a bearish signal pointing towards further declines.


Key Takeaways:


* The US Dollar loses momentum after Trump puts tariffs on Canada and Mexico on hold.
* Tariffs in the UK are not likely in the near future but remain at risk for the next 4-years. The EU is likely to see tariffs imposed upon them.
* The Bank of England is likely to cut 0.25% basis points on Thursday.
* Analysts have lowered their expectations for two interest rate cuts this year to 54.0%.
If the GBPUSD drops below 1.23777, it will trigger a breakout and prompt a bearish signal.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.


Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work.

Michalis Efthymiou
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFM]

Date: 03rd February 2025.


What do Trump's Tariffs Mean for the Financial Trading Markets?


The announcement of the first Trump tariffs sends volatility through the roof. The market’s first reaction is to sell stocks and buy the US Dollar. The first countries to be hit by tariffs are Canada, Mexico and China. However, the US President also gave interesting indications on the government’s next moves.


SNP500 - Tariffs on China, Canada and Mexico Send Stocks Lower!


The SNP500 opens on a bearish price gap measuring 1.54% but trades 1.76% lower than Friday’s close. The decline is driven by a sharp drop in risk appetite from tariffs on Mexico, Canada, and China. The VIX, a risk sentiment indicator, is up over 8%, reflecting the fall in market confidence.


Today’s sharp decline is one of the strongest seen in 2025 so far, but up to now remains weaker than the 2.95% decline from January 27th. The previous decline was due to the global repercussions of Chinese AI companies gaining momentum. However, this recent decline indicates that today’s downward trend may still gain momentum when the European and US sessions open.


The only concern for traders is the price is trading close to the SNP500’s recent support level. The SNP500’s support level at $5,920 in the previous week triggered an upward correction, partially fueled by earnings data. Alphabet is due to release its quarterly earnings report tomorrow after market close and Amazon on Thursday. Therefore, traders should be cautious that while the downward risk remains great, the earnings data may prompt demand similar to the week before.


China has also made a statement advising they are currently working on a trade proposal with the US in order to avoid tariffs. If an announcement is made indicating an agreement with China, the SNP500 could potentially gain bullish momentum. However, no such announcement has yet been made.


The US 10-ear Bond Yields increase in value during the Asian session and the VIX index continues to rise as the European session edges closer. If bond yields and the VIX continue to increase throughout the day, the bearish bias is likely to strengthen. According to price action and price momentum indicators, the SNP500 is likely to witness sell signals at $5,924 and below.


Euro - The Day’s Worst Performing Currency!


The Euro is coming under pressure due to Trump’s latest interview as he was walking off Airforce One. President Donald Trump commented on the first tariffs on Mexico, Canada and China, but also said that tariffs “will definitely happen with the European Union”. Whereas, with the UK he was less concrete in his response. With the UK Trump advised there will likely be tariffs but they “may be able to work” something out.


In terms of the European economy, December retail sales dropped 1.6% month-over-month (MoM) and slowed from 2.9% to 1.8% year-over-year (YoY). This reinforces the expectations of further interest rate adjustments by European Central Bank (ECB) officials. In the Eurozone’s largest economy, conditions for this shift are in place, as inflationary pressures ease and economic growth weakens due to sluggish demand and lower household activity.


Additionally, Bank of Finland head Olli Rehn and Bank of Estonia governor Madis Müller emphasized the priority of a dovish policy stance in his speech on Friday. The Euro is currently the worst-performing currency of the day.


The US Dollar - Safe Haven Status Increases Investor Demand!


The US Dollar is currently the best performing currency due to its safe haven status. The USD Index is currently trading 1.25% higher and is the only currency index witnessing gains. The currency is witnessing the strongest gains against the Euro and the New Zealand Dollar.


Consumer inflation in the country remains well above the 2.0% target, and some analysts believe it has stabilized at this higher level, raising the chances of a pause in monetary easing. This is likely to continue supporting the US Dollar, particularly if this week’s employment data beats expectations.


Key Takeaways:


* Trump's announcement of tariffs on Mexico, Canada, and China sparks a sharp market decline, with the S&P 500 down by 1.76% and risk appetite falling.
As the US 10-year bond yields increase and the VIX climbs, bearish momentum strengthens, signaling further declines in the S&P 500.
* The Euro weakens after Trump hints at potential tariffs on the European Union, with December retail sales and ECB policies adding to downward pressure.
* The US Dollar benefits from its safe haven status, rising 1.25% as investors seek stability amid tariff-related uncertainty.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.


Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work.

Michalis Efthymiou
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFM]

Date: 29th January 2025.


Market Recap: Treasury Yields Rise as Tech Stocks Rebound.


Asia & European Sessions:


* Markets had largely recovered from Monday’s selloff triggered by fears over AI competition from China’s DeepSeek. Dip buyers took advantage of the NASDAQ’s sharp decline, leading to a rebound of 2.03%, which erased much of Monday’s 3.07% drop. The S&P500 climbed 0.92% after shedding 1.46% the previous day, while the Dow inched up 0.31%.
* Asian stocks and European equity futures increased following Wall Street’s tech-driven recovery. Japanese, Australian, and Indian markets saw gains, though many regional exchanges remained closed for Lunar New Year celebrations.
* Nvidia regained nearly half of its 17% plunge, which had marked the largest single-day market cap loss in history.
* As investor anxiety eased, the VIX volatility index dropped 8.66% to 16.35, after briefly touching 21 on Monday.
* Positive earnings from Visa, Royal Caribbean, and Boeing helped lift sentiment, though JetBlue and General Motors disappointed.
* Market attention is now turning to the Federal Reserve’s interest rate decision and earnings reports from major tech firms. The Fed is universally expected to leave rates unchanged at a 4.375% mid-range, taking a pause after three consecutive easings totalling -100 bps since the jumbo -50 bps in September. The resilient economy and still sticky inflation do not give the Fed room to credibly continue with its policy course. And we do not expect any surprises from Chair Powell's press conference where he should stress the economy remains solid, with risks to inflation and employment generally in balance.
* Upcoming earnings: Microsoft, Tesla, Meta, IBM, ASML, ADP and Apple on Thursday.


Financial Markets Performance:


* USOIL rose 0.97% to $73.50 per barrel, while gold climbed 0.88% to $2,764 per ounce.
* Aussie weakened, while 3-year bond yields dropped 5 bps on expectations of monetary easing. Australia’s core inflation cooled more than expected in the Q4 2024, prompting speculation that the RBA may soon pivot to rate cuts.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.


Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work.

Andria Pichidi
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFM]

Date: 27th January 2025.


Mild Risk-Off Sentiment: Stocks Slide, Yen Gains, and Bitcoin Dips Amid Tariff Tensions and Fed Anticipation.


Asia & European Sessions:


* European stock market indexes are lower in early trade, after a mixed session in Asia, where concern over the weaponization of tariffs and a possible tech shakeup put mainly China bourses on the back foot.
* Trump’s threat to impose tariffs on Colombia, citing the country’s refusal to accept military flights carrying deported migrants, prompted Bogotá to threaten retaliatory measures. However, the White House later announced Colombia had agreed to accept the flights, defusing immediate tensions. Trump also signalled potential tariffs on Canada and Mexico starting February 1.
* The Hang Seng is up 0.6%, while the Nikkei dropped as central bank action remains in focus and the yen rallied. DAX and FTSE100 are down -1.2% and 0.4% respectively in early trade and a -2.8% correction in the NASDAQ is leading US futures lower.
* Bonds meanwhile are rallying as risk aversion picks up.
* The Yen rose against the US dollar during Asian trading hours, as investors sought its safety amidst concerns about President Donald Trump’s tariff. On Friday, the yen briefly climbed 0.8% after the BOJ raised its policy rate to the highest level since 2008 but later retreated. BOJ Governor Kazuo Ueda indicated the central bank would maintain rate hikes as wage and price growth broadened but gave few hints on the pace of future increases.
* Bitcoin saw a sharp decline as traders took profits just days followed Trump’s Friday announcement of a long-anticipated executive order establishing a working group to guide the White House on cryptocurrency policy. This group has been tasked with drafting a regulatory framework for digital assets within six months, while also exploring the idea of creating a national crypto stockpile.
* Earnings reports from over 100 S&P500 companies will dominate headlines, featuring major players like Meta (META), Microsoft (MSFT), Apple (AAPL), and Tesla (TSLA). Wednesday is shaping up to be the busiest day, with additional reports from Starbucks (SBUX), Exxon (XOM), and Chevron (CVX).
* The Federal Reserve will also be in focus on Wednesday, announcing its latest policy decision. While rates are expected to remain unchanged, investors will closely monitor Fed Chair Jerome Powell's remarks for clues about monetary policy for the rest of 2025.


Financial Markets Performance:


* The USDIndex is little changed at 107.40. Expectations of widespread tariffs on imports from countries like China, Canada, and Mexico have fueled inflation fears, driving US Treasury yields higher and bolstering the dollar.
* The USDJPY traded at 155.88 after the BOJ raised rates and revised inflation forecasts higher.
* The Mexican peso, often sensitive to tariff news, fell 0.7% to 20.409 per dollar, while the Canadian dollar weakened to 1.4385 per dollar.
* The euro edged down 0.2% to $1.0455 ahead of an ECB meeting expected to lower borrowing costs. The British pound traded lower at $1.2428.
* Bitcoin slipped below $98,300. Other tokens like Solana and Cardano, which had surged following Trump’s election victory, experienced even steeper losses, according to Bloomberg data.
* Oil prices are down -0.4% at $74.28 per barrel.
* Gold is down -0.6% at a still-high $2753.80 per ounce.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.


Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work.

Andria Pichidi
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFM]

Date: 14th January 2025.


Asia & European Sessions: Market Sentiment Shifts on Tariff Talks and Inflation Data Focus.




Trading Leveraged Producys is Risky


Asia & European Sessions:


*Bearish momentum after Friday's meltdown, rising oil prices, technicals, and apprehension over upcoming inflation reports left the market heavy and buyers scarce.
*Market sentiment got a boost by a Bloomberg source story suggesting that President-elect Trump's team considers a gradual fading in of tariffs. The report boosted stock market sentiment in Asia and Europe.
*Trump team studies gradual tariff hikes . Bloomberg cited "people familiar with the matter" as saying that "members of President-elect Donald Trump's incoming economic team are discussing slowly ramping up tariffs month by month, a gradual approach aimed at boosting negotiating leverage while helping avoid a spike in inflation". "One idea involves a schedule of graduated tariffs increasing by about 2-5% a month, and would rely on executive authorities under the International Emergency Economic Powers Act." The sources said the proposal is still in its early stages and has not yet been presented to Trump.
*Bond yields finished marginally off their highs on possibility of gradual tariffs. The curve steepened slightly to 39 bps from 37.5 bps Friday and is out from 31.7 bps at the start of the month.
*Chinese shares rallied as much as PBoC to enhance policy tools, which allow institutional investors to access central bank funding for buying stocks. Coupled with a jump in new yuan loans that helped the Hang Seng to close 1.8% higher, while the CSI300 jumped 2.6%. Eurozone stock markets are also finding buyers, and the DAX is up 0.6%. The FTSE100 is underperforming, but yields are down also in the UK.
*US inflation is the focal point this week with key data due out, and it doesn't look pretty. Attention is on CPI (Wednesday) where we are forecasting monthly increases of 0.3% for headline and core metrics, with the y/y measures at 2.8% for the headline and 3.3% for the core. However, also due are today's report from the NY Fed on 1-year inflation expectations, PPI today, and trade prices (Thursday), along with the price numbers in the Empire State (Wednesday) and Philly Fed (Thursday) indexes.





Financial Markets Performance:


*The USDIndex hit a session low of 109.33.
*EURCHF presents a rectangle identified at 14-Jan-04:00. This pattern is still in the process of forming. Possible bullish price movement towards the resistance 0.9437 within the next 3 days. Supported by Upward sloping Moving Average.
*Oil prices are slightly lower, and the USOIL contract is at USD 78.65 per barrel.
*Gold is a tad higher at $2670.1 per ounce.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.


Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work.

Andria Pichidi
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFM]

Date: 13th January 2025.


Global Market Update: Asian Stocks Fall, Pound Weakens,Oil Surges Amid Fed and Geopolitical Shifts.



Trading Leveraged Producys is Risky


Asia & European Sessions:


* Asian markets tumbled alongside European and US equity futures as investors scaled back expectations of near-term interest rate cuts by the Fed, following stronger-than-expected US payroll data.
*Bank of America has revised its outlook, no longer anticipating two 25 bps rate cuts this year and warning that the Fed’s next move could be a hike. Goldman Sachs also adjusted its forecast, expecting two rate cuts instead of three for 2025.
*Chinese equities also slid further despite data showing record exports for 2024, as concerns linger over potential higher US tariffs once President-elect Donald Trump takes office.
*The Pound extended its decline from last week, hitting a multi-month low.
*Oil prices surged to a 4-month high due to fresh US sanctions on Russia. These measures included restrictions on two major oil exporters, insurance companies, and over 150 oil tankers.
*China Intervenes to support the Yuan: China intensified its efforts to stabilize the yuan after the currency neared record lows in offshore trading. The People’s Bank of China, along with other regulators, vowed to strengthen oversight of the foreign exchange market, crack down on disruptive activities, and prevent further declines in the yuan.
*Geopolitical tension continues as Justin Trudeau stated that Canada is ready to respond with counter-tariffs against the US if President-elect Donald Trump follows through on his threat to begin a trade war in North America.


Canada is the largest buyer of US-made products, purchasing approximately $320 billion worth in the first 11 months of last year. He emphasized that Canada is the top export partner for 35 US states, and any trade restrictions would ultimately hurt American businesses and workers. Recalling the 2018 tariffs on steel and aluminum under the Trump administration, Trudeau pointed out that Canada had responded by imposing duties on various US goods, including appliances, bourbon whiskey, and boats. He reiterated that his government is ready to take similar action if necessary.





Financial Markets Performance:


*The USDIndex has inched up to 109.84, despite the fact that the Yen strengthened. EURUSD and cable remain under pressure.
*The Pound fell as much as 0.7% to $1.2126, marking its lowest level since November 2023, amid stagflation concerns and budget jitters. This extended a 1.7% drop from the previous week.
“A slowing economy and widening deficits in both the current account and fiscal balances are weighing on the pound,” said Christopher Wong, a currency strategist at Oversea-Chinese Banking Corp.


*Oil markets were in focus as UKOIL rose above $81 per barrel during Asian trading hours & USOIL to $77.55 driven by US sanctions targeting Russia’s energy sector.
*Gold is steady at $2686.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.


Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding of how markets work.

Andria Pichidi
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.

[HFM]

Date: 10th January 2025.


Why is the British Pound Declining?



Trading Leveraged Producys is Risky


The Great British Pound is the worst performing currency of 2025 so far after witnessing sharp declines for 3 consecutive days. The decline is largely being triggered by the bond selloff, lack of business confidence due to the UK Autumn budget and political uncertainty. Will the trend continue?





The GBP Index Declines 2% In 2025! Why Is The Pound Dropping?


The Great British Pound is the worst performing currency of the week and of the year so far. Below you can see a table showing the Pound’s performance in January 2025 so far.


GBPUSD -2.25%


EURGBP +1.69%


GBPJPY -1.44%


GBPCHF -1.42%


GBPAUD -1.91%


GBPCAD -2.00%


A key reason for the GBP’s decline is the latest labor budget, which is driving a selloff in UK bonds. Bonds across the global market are declining, including in the US and Germany. However, the global decline is mainly due to monetary policy. The decline in UK bond yields is due to concerns regarding the UK budget, higher costs for business and investor confidence. As a result, investors are selling UK bonds, but also reducing their exposure to the Pound.


Bond Selloff and Rising Yields: Higher bond yields can sometimes strengthen a currency by attracting increased investor demand. However, this effect is unlikely when rising yields result from a bond selloff driven by declining investor confidence.


The UK 30-Year Bond Yields are at their highest level since 1998 and the 10-Year Bond Yields are up to the highest level since the banking crisis of 2008. Investors’ concerns are that the higher costs for business will be passed onto consumers, triggering higher stickier inflation. As a result, the Bank of England will struggle to reduce the cost of borrowing in 2025 and foreign investors will become more cautious of operations in the UK.


The short-term impact is that the UK Chancellor may struggle to meet her fiscal rules. Her budget margin of £9.9bn to avoid overshooting borrowing has likely shrunk to about £1 billion due to market shifts, even before the OBR updates its forecasts. This uncertainty may force the Treasury to cut future spending plans, but the full picture won’t emerge until the OBR's March forecast. According to reports, the UK Chancellor cannot risk higher increases in taxes and will be forced to cut public spending.


The GBPUSD Falls To A 60-Week Low!


The GBP is struggling against all currencies, but the sharpest decline can be seen against the USD. The GBP’s decline is partially due to the incoming president, Donald Trump, who is expected to introduce Dollar-supporting measures, but also potentially impose tariffs on the UK.





The new White House administration is likely to impose new tariffs on imports from China, Canada, and Mexico. This is likely to potentially disrupt supply chains and prompt the Federal Reserve to adopt tighter monetary policy, thereby strengthening the national currency. Some experts believe the UK will face tariffs or be pressured to adopt more pro-American economic policies. This is also something the EU will likely experience. In addition to this, reports suggest that the UK Prime Minister, Keir Starmer, and Trump supporters are not on good terms, nor agree on much including on Geo-politics.


Therefore, the decline is also related to concerns the UK may be put into a difficult position by the new US administration. According to analysts, Dollar strength is likely to continue throughout the year due to the new administration’s measures, but also due to a hawkish Federal Reserve. In the latest FOMC meeting minutes, the committee stated it expects interest rates to decline at a slower pace. The Federal Reserve is likely to only cut 0.50% in 2025 and may not cut until May or June.


Liz Truss 2022 Or James Callaghan 1976?


Is this the first Pound crisis? The GBP has experienced many "sterling crises” in the past. For example, Black Wednesday from 1992 and after Brexit in 2016. However, there have been similar crises in the past which are very similar to the current situation. For example, the Liz Truss Budget from 2022 which saw the GBP decline more than 23%. During the Sterling Crisis of 1976 the GBPUSD fell from 2.0231 to 1.5669.


Both sterling crises were due to the budget, inflation and rising bond yields. Today’s issues for the GBP and UK are very similar, however, the performance of the GBP will depend on if the new SI contributions triggers lower economic activity, inflation and if the Federal Reserve indeed avoids cutting interest rates in the near future. If inflation rises it will dampen consumer demand and the Bank of England will be forced to pause any rate adjustments. As a result, the economy may contract or stall further pressuring the GBP.


However, this cannot yet be certain. KPMG experts anticipate accelerated economic growth this year, supported by monetary policy and increased government spending. They project GDP to rise to 1.7%, more than doubling last year’s 0.8%. This growth, according to their estimates, will be driven by a recovery in consumer spending, expected to increase by 1.8% compared to 1.0% last year. In addition to this, if the Federal Reserve unexpectedly opts for more frequent rate cuts, the GBP and EUR are likely to benefit.


When monitoring the price movement and patterns which can be seen in the exchange rate, the decline looks similar to the price movement seen in 2022, during the Truss reign. The price has now fallen below the support level from April 2024. The next support levels can be seen at 1.20391 and 1.17992. Technical analysis for the GBP can also be viewed in HFM’s latest Live Trading Session.


Key Takeaways:


*The Great British Pound is the worst performing currency of the year so far, having declined by more than 2.00%.
*A key reason for the GBP’s decline is the latest labor budget, which is driving a selloff in UK bonds.
*UK 30-year bond yields are at their highest since 1998, while 10-year yields have reached levels last seen during the 2008 banking crisis.
*Investors reduce exposure to the GBP as the US edges closer to a new president and pro-Dollar supportive measures.
*The UK labour government will not reconsider higher taxes but may be forced to reduce public spending.


Always trade with strict risk management. Your capital is the single most important aspect of your trading business.


Please note that times displayed based on local time zone and are from time of writing this report.

Michalis Efthymiou
HFMarkets

Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in Leveraged Products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.