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

[HFM]

Date: 20th February 2025.


The Yen Continues To Rebound, Investors Boost Bets Of Rate Hikes



Trading Leveraged products is Risky


The Japanese Yen significantly increases in value against all currencies and the JPY Index is trading at a 2-month high. The primary factor supporting the Japanese Yen is the growing expectation of the Bank of Japan raising interest rates, along with its safe-haven appeal.


Will the JPY be the best-performing currency of 2025?


DAX 40 - What’s Driving the Bullish Trend?


The Japanese Yen is the best-performing currency of the year increasing by 4.20% so far. The second best-performing currency is the Australian Dollar which has risen 2.83% and the New Zealand Dollar which is up 2.20%. Here we can see the momentum of the JPY in 2025.


The main supporting factors are the Bank of Japan’s interest rate hikes, expectations of further hikes and the currency’s safe haven characteristics. Investors were also quick to consider increasing their exposure to the Japanese Yen as the currency was trading at a price 33% lower than in 2022.


The Bank of Japan over the past months has taken interest rates to a 17-year high. Currently, investors believe the Bank of Japan will adjust its main rate by a further 50 basis points to 1.00%. This would take the BoJ’s rate to the highest since 1995. Meanwhile, this week the Bank of Japan Governor Mr Takata stated that the central bank should further increase interest rates, warning that maintaining the current levels might cause the public to become too accustomed to the risks of rising prices and accelerating inflation. The Bank of Japan’s next interest rate decision will be on March 19th.


One of the key concerns for the Bank of Japan is the country’s inflation rate which has risen to 3.6%. Inflation is currently at its highest level since January 2023. Another key influential factor is potential tariffs not only on Japan but also on the main global economies. In 2018, when tariffs were previously introduced, the Japanese Yen rose in value due to its safe haven nature. However, traders will evaluate upcoming tariffs and its domino effect on the Japanese Yen day by day.


The US Dollar and Its Risks To The Japanese Yen


The US Dollar continues to struggle in February 2025, however, fundamental factors continue to indicate the currency can rebound. Traders should note that a strong US Dollar can have a negative effect on the Japanese Yen. Market optimism is bolstered by the Senate's confirmation of financier Howard Lutnick as Secretary of Commerce. A former Cantor Fitzgerald director and supporter of Donald Trump’s trade policies, Lutnick has dismissed concerns that high tariffs fuel inflation and advocates for stronger sanctions to reduce export barriers. His appointment raises the risk of strained US trade relations.


Meanwhile, San Francisco Fed President Mary Daly emphasized the need for restrictive monetary policy until inflation slows, citing economic and labour market stability. The Federal Reserve seeks ‘further progress on inflation’ before cutting rates, according to FOMC Meeting Minutes. Some members of the committee suggested a limited need for further reductions. Meanwhile, economists advise the Federal Reserve is not likely to cut interest rates unless inflation falls to at least 2.7%.


USDJPY - Technical Analysis


The US Dollar Index is currently trading 0.16% lower ensuring there are no current conflicts while the Japanese Yen is increasing in value. In the 2-hour timeframe, the USDJPY is trading comfortably lower and below all major Moving Averages. The USDJPY is also trading below 30 on the Relative Strength Index again indicating sellers are driving the price lower.





However, traders will be cautious the price action does not change as the Asian session comes to an end. Currently, the price has retraced upwards as the close edges nearer. Bearish momentum will need to be regained in order for sell signals to again materialize. The price movement will also depend on today's US news releases.


Key Takeaway Points:


* Japanese Yen Strength – The JPY is the best-performing currency of 2025 so far, gaining 4.20%, driven by expectations of Bank of Japan (BoJ) rate hikes and its safe-haven appeal.
* Japanese Inflation - Japan’s inflation rate which has risen to 3.6%. Inflation is currently at its highest level since January 2023
* Bank of Japan's Monetary Policy – The BoJ has raised rates to a 17-year high and may hike further by 50 basis points to 1.00%, the highest level since 1995.
* US Dollar Influence – A stronger US Dollar could pressure the Yen. The Fed is maintaining a restrictive policy, and rate cuts are unlikely unless inflation falls to at least 2.7%.


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: 19th February 2025.


Is the DAX Overbought After Rising For 7 Weeks Straight?



Trading Leveraged products is Risky


The DAX rose by 20% in 2024, however, in 2025 so far the DAX has risen more than 15% in only 50 days. The DAX has risen for seven straight weeks, driven by rate cuts and strong earnings reports. Can the DAX maintain momentum or is the price overbought?


DAX 40 - What’s Driving the Bullish Trend?


Three factors are driving the price of the DAX higher. The first is the European Central Bank which has cut for 2 consecutive months and is likely to adjust a further 0.75% in 2025. The lower interest rates and expectations of further cuts are known to support the DAX due to higher consumer demand.





The second factor driving prices higher are the positive earnings data. SAP SE is the most influential stock and has risen by 18% so far this year. SAP’s latest quarterly earnings report saw the company beat revenue expectations by 2.60% and earnings by 1.40%. The second most influential stock for the DAX is Siemens AG which has risen almost 20% in 2025 so far. All of the seven most influential stocks have risen in value this year so far and only 17% of the whole DAX have declined this year so far. However, traders should note that not all companies within the DAX have made public their quarterly earnings reports.


The third factor is the expectation that the Ukraine-Russia conflict will end or reach a ceasefire in the first half of the year. Traders should note that an end to the conflict is more crucial for European indices in comparison to Asian or US indices. This is due to the nature of Europe and European geopolitics.


Is the German DAX Overbought?


When analyzing the price movement the index is trading in the overbought zone on most oscillators and on most timeframes. However, price action and previous impulse waves indicate the price will not be overbought unless the price increases above 23,250EUR. However, the intrinsic value of the DAX will also depend on US tariffs.


If Germany is able to avoid harsh US tariffs, German stocks may continue to increase higher as sentiment improves. However, harsh tariffs are likely to apply downward pressure on the index and increase the likelihood of being overbought in the short-to-medium term.


If the price indeed declines, traders may first target the support level at $22,437.58, which will likely fall in line with the 75-period Moving Average. The main bullish breakout point is at the 22,724.30 mark.


Tariffs on Foreign Cars


A key risk for the DAX as mentioned above is US tariffs, particularly on cars. The DAX index includes Mercedes-Benz, Porsche AG, BMW, and Volkswagen. Total new cars sales in the US from these 4 companies make up almost 10% of the overall sales.





Donald Trump remained defiant despite warnings that his proposed trade war could disrupt the US economy, stating that his administration might impose tariffs of approximately 25% on foreign cars within weeks. He also announced that semiconductor chips and pharmaceuticals would soon face higher tariffs, speaking at a news conference on Tuesday.


Key Takeaway Points:


* The DAX has surged over 15% in 2025, driven by ECB rate cuts, strong earnings, and optimism over the Ukraine conflict.
* SAP SE and Siemens AG are the top-performing stocks and 83% of the DAX has witnessed gains. However, some earnings reports are still pending.
* Despite trading in overbought territory, the index may continue rising unless it faces harsh US tariffs.
* Potential US tariffs on foreign cars pose a key risk, impacting major DAX-listed car makers. This includes Mercedes-Benz, Porsche AG, BMW, and Volkswagen.


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. halis 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.v

[HFM]

Date: 18th February 2025.


UK Unemployment Rate Falls and The Pound Spikes Upwards.



Trading Leveraged products is Risky


The British Pound spikes upwards against all currencies as the UK releases its employment data. However, the latest employment data release does not give long-term confidence as the UK continues to see a higher possibility of economic stagnation in 2025. Can the GBP maintain momentum?


UK Releases Latest Employment Data!


The UK employment data had its positive and negative points. The Monthly Unemployment Claims rose 22,000 which is at a 3 month high, and higher than analysts’ previous expectations. This is known to be negative for the British Pound. However, the UK also saw some positive data which investors are clinging onto. The UK Unemployment Rate fell for the first time since October 2024.


The UK Unemployment Rate, to the surprise of analysts, fell from 4.5% to 4.4%. Lastly, the Average UK Salaries Index rose to 6.00%, the highest in 13 months and higher than previous expectations. This is the main reason why the GBP is increasing in value. That said, the Bank of England and economists continue to expect the UK to witness stagnation in 2025.





The British Pound


The British Pound is now one of the best-performing currencies of the day so far. The US Dollar and Japanese Yen are also strongly increasing in value. The Governor of the Bank of England, Mr Bailey, is due to speak at 09:30 GMT and is likely to comment on the latest employment data.


Previously, Bailey described the UK’s economic growth as “static,” despite stronger-than-expected Q4 2024 data—0.1% growth instead of the forecasted –0.1% quarterly and 1.4% annually versus the expected 1.1%. Meanwhile, the BoE revised its 2025 GDP growth forecast down to 0.75% from 1.0% in November. Traders are also hoping Governor Bailey will comment on the possible future rate cuts.


Tomorrow at 09:00 (GMT+2), the UK will release January inflation data. Analysts expect the annual CPI to rise from 2.5% to 2.8%, while monthly prices may drop by 0.3% after a similar increase in December. The Core CPI is projected to climb from 3.2% to 3.6%.


When evaluating the GBP Index, the GBP is currently trading 0.95% higher in 2025. However, the upward price movement is largely due to last week’s Gross Domestic Product which beat expectations. The performance of the GBP will also depend on whether the US imposes tariffs. Additionally, pressure on the UK to increase defence spending could further strain the country's already scrutinized budget.


GBPUSD - Technical Analysis and Price Condition


The GBPUSD is trading above the main moving averages on the 2-hour timeframe and is trading high on most oscillators. These factors indicate that the buyers are currently controlling momentum, but traders are concerned about two factors.


The first is that the GBPUSD is struggling to break above the 1.26300 level and the fact that both the USD and GBP is simultaneously increasing in value. As both currencies are increasing in value, technical analysts view the price action as conflicting. On the 5-minute chart, the GBPUSD is trading at the 200-bar average price movement indicating a neutral signal. This also follows the concerns of traders that the price action is conflicting.





If the price breaks above 1.25918, the GBPUSD may witness sell signals materialize. However, if the price breaks above 1.26200, buy signals may arise which will also be in line with the indications on the 2-hour timeframe.


Key Takeaway Points:


* GBP rises as the UK employment data lifts GBP, but stagnation concerns remain.
* UK Salaries hit a 13-month high, boosting the Pound.
* The Bank of England Governor, Mr Bailey may hint at future rate cuts and advises the UK will witness economic stagnation.
* The key risks for the GBP remain inflation data, US tariffs, and UK defence spending pressure.


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: 17th February 2025.


The AUD Surges as Foreign Buyer Ban Hits & Rate Cuts Nears!


In 2025 the Australian Dollar has been one of the best-performing currencies increasing by 2.85% so far. Analysts expect the AUD to be one of the most volatile currencies of the week due to policy changes. The Reserve Bank of Australia is due to cut its interest rates by 0.25% and has announced a ban on foreigners purchasing homes for 2 years. What does this mean for the Australian Dollar?


RBA To Cuts Rate For First Time Since 2025


Analysts expect the Reserve Bank of Australia to cut interest rates from 4.35% to 4.10% tomorrow morning. This would mark the first time that the RBA has cut interest rates since November 2020. Lower interest rates tend to pressure the currencies, however, the value of the AUD will largely depend on how frequently the RBA will cut in 2025. Tomorrow’s press conference at 04:30 GMT will be key for further indications.


Meanwhile, the Commonwealth Bank of Australia reported a 2.0% year-on-year profit increase, reaching $5.13 billion for the six months ending December 31. The bank also posted a 7.0% profit increase for the second half of its 2024 financial year, surpassing analysts' expectations of $5.06 billion. It announced an interim dividend of $2.25 per share, a 5.0% increase from the previous year.


Following the earnings release, the bank's shares surged 2.4%, making them the top gainers on the ASX 200 and hitting a record high of $165.98. While Australian households and businesses continue to face rising living costs, experts note a decline in loan defaults and fewer customers seeking financial assistance, largely attributed to low unemployment.


Australia Ban Foreigners from Buying Homes for 2-Years


Australia restricts foreign home purchases for two years to help balance supply and demand. At first, the price of the currency index opened at a lower price (bearish price gap). However, the price has since risen in value and is currently one of the better-performing currencies of the day. So far, the currency has not negatively reacted to the news, but investors remain on the lookout.


Starting April 1, 2025, Australia will ban foreign buyers, including temporary residents and foreign-owned companies, from purchasing homes until March 2027. Housing Minister Clare O’Neil announced the move to address soaring property prices and support local buyers, especially young voters.


EURAUD - Indications and Price Analysis.


The Euro is the day's worst-performing currency and may face further pressure this week amid scrutiny over the German elections. For this reason, the EURAUD currently is witnessing less conflicting price action elements and indications. The EURAUD on a 2-hour timeframe is currently trading below both trend-lines and Moving Averages and below the neutral level of the RSI.


Simultaneously, the EURAUD is also trading lower on the 5-minute timeframe. On the 5-minute timeframe the price is trading below the 200-period SMA and may see sell indications strengthen if the price falls below 1.64452. The next significant support level can be seen at 1.63895.


Key Takeaway Points:


* Australia Ban Foreigners from buying homes for 2 years in an attempt to balance the current supply and demand. The Australian Dollar increases in value on Monday.
* Analysts expect the Reserve Bank of Australia to cut its main Cash Rate by 25 basis points tomorrow morning.
* The Japanese Yen, US Dollar and Australian Dollar are the best-performing currencies of the day so far.
* The Euro is the day's worst-performing currency and may face further pressure this week amid scrutiny over the German elections.


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: 14th February 2025.


Can The NASDAQ Maintain Momentum at Key Resistance Level?



Trading Leveraged products is Risky


The price of the NASDAQ throughout the week rose more than 3.00% to bring the price back up to the instrument’s resistance level. However, while taking into consideration higher inflation, tariffs and the resistance level, could the index maintain momentum?


US Inflation Rises For a 4th Consecutive Month


The US Consumer Price Index, or inflation, rose for a 4th consecutive month taking the rate even further away from the Federal Reserve’s target. Analysts were expecting the US inflation rate to remain unchanged at 2.9%. However, consumer inflation rose to 3.00%, the highest since July 2024, while Producer inflation rose to 3.5%.


Higher inflation traditionally triggers lower sentiment towards the stock market as investors' risk appetite falls and they prefer the US Dollar. However, on this occasion bullish volatility rose. For this reason, some traders may be considering if the price is overbought in the short term.


Addressing these statistics, US Federal Reserve Chair Jerome Powell acknowledged that the Fed has yet to achieve its goal of curbing inflation, adding further hawkish signals regarding the monetary policy. Other members of the FOMC also share this view. Today, Raphael Bostic, President of the Federal Reserve Bank of Atlanta, stated that the Fed is unlikely to implement interest rate cuts in the near future. This is due to ongoing economic uncertainty following the introduction of trade tariffs on imported goods and other policies from the Republican-led White House.


Most of the Federal Open Market Committee emphasizes additional time is needed to fully assess the situation. According to the Chicago Exchange FedWatch Tool, interest rate cuts may not start until September 2025.


What’s Driving The NASDAQ Higher?


Earnings data this week has continued to support the NASDAQ. Early this morning Airbnb made public their quarterly earnings report whereby they beat both earnings per share and revenue expectations. The Earnings Per Share read 25% higher than expectations and Revenue was more than 2% higher. As a result, the stock rose more than 14%. Another company this week that made public positive earnings data is Cisco which rose by more than 2% on Thursday.


Another positive factor continues to be the positive employment data. Even though the positive employment data can push back interest rate cuts, the stability in the short term continues to serve the interests of higher consumer demand. The US Unemployment Rate fell to 4.00% the lowest in 8 months. Lastly, investors are also increasing their exposure to the index due to sellers not being able to maintain control or momentum. Some economists also increase their confidence in economic growth if Trump can obtain a positive outcome from the Ukraine-Russia negotiations.


However, during Friday’s pre-US session trading, 80% of the most influential stocks are witnessing a decline. The NASDAQ itself is trading more or less unchanged. Therefore, the question again arises as to whether the NASDAQ can maintain momentum above this area.


NASDAQ - News and Technical analysis


In terms of technical analysis, the NASDAQ is largely witnessing mainly bullish indications on the 2-hour chart. However, the main concern for traders is the resistance level at $21,960. On the 5-minute timeframe, the price is mainly experiencing bearish signals as the price moves below the 200-period simple moving average.


The VIX, which is largely used as a risk indicator, is currently trading 0.75% higher which indicates a lower risk appetite. In addition to this, bond yields trade 6 points higher. If both the VIX and Bond yields rise further, further pressure may be witnessed for index traders.
Please note that times displayed based on local time zone and are from time of writing this report.


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: 12th February 2025.


Financial Markets Await Key Inflation Data Amid Fed's Steady Stance.


Market activity remained largely uneventful despite Federal Reserve Chair Jerome Powell’s testimony and the commencement of the Treasury’s February refunding. Investors stayed on the sidelines, with little market-moving news to provide direction. Ongoing concerns over tariffs added an element of uncertainty, while Treasury yields remained under pressure throughout the session.


Powell Reaffirms Cautious Approach to Interest Rates


In his Senate testimony, Powell reiterated that the Federal Open Market Committee (FOMC) is in no rush to adjust interest rates. He highlighted the resilience of the US economy and labour market, noting that while inflation has moderated over the past two years, it remains elevated. Powell also suggested that the neutral rate might be slightly higher than previously estimated, though this is not a new stance among policymakers. He avoided discussing fiscal policies or tariffs but explicitly stated that the Federal Reserve has no plans to issue a central bank digital currency. However, he confirmed the Fed’s support for stablecoin regulations.


Bond Market Reaction and Treasury Yield Movements


Treasury markets remained under pressure, with the upcoming Consumer Price Index (CPI) report keeping buyers on the sidelines. Even a strong 3-year auction failed to provide a significant boost. Short-term yields saw slight increases, with the 2-year yield closing at 4.287% and the 3-year yield at 4.305%, both just below their session highs. Longer-term yields also edged higher, with the 10-year note at 4.533% and the 30-year bond at 4.743%.


Wall Street Mixed as Dollar Weakens


US equity markets closed mixed after recovering from early losses. The Dow Jones Industrial Average climbed 0.28%, while the S&P 500 inched up 0.03%. The tech-heavy Nasdaq Composite dipped 0.36%, weighed down by sector-specific pressures. The US Dollar Index (DXY) retreated from a session high of 108.463 to settle at 107.944 as Powell’s remarks reassured investors, overshadowing concerns over tariffs and rising yields.


Asian and European Markets React


Ahead of the inflation data release, equity index futures showed mixed movements, while Treasury yields edged lower following Tuesday’s declines. In Asia, Japanese 5-year bond yields reached 1% for the first time since 2008, and the yen weakened for a third consecutive session on tariff-related worries. Meanwhile, China and Hong Kong stocks saw tech-driven gains, with Alibaba Group rising 8.6% on reports of a partnership with Apple to integrate AI into its products. DeepSeek’s AI developments also boosted Chinese stocks, with analysts suggesting the rally has further upside potential.


In Europe, ABN Amro Bank NV reported lower-than-expected profits, while Heineken NV exceeded expectations on beer volumes. The UK’s fiscal watchdog revised its growth forecasts downward, posing fresh challenges for Chancellor Rachel Reeves, who may face potential spending cuts.


Inflation Data in Focus


Investors are eagerly awaiting key US inflation data, set for release later today. Market forecasts indicate that the core CPI, excluding food and energy, likely rose 0.3% in January—the fifth such increase in the past six months. The strong labour market continues to support economic growth, reinforcing the Fed’s cautious approach to monetary policy.


Money markets are currently pricing in a single quarter-point rate cut by the Fed this year, expected by September. Earlier projections included two additional cuts in 2025, but a strong January jobs report has prompted a reassessment of the policy outlook.


Currency and Commodity Market Highlights


The Yen remained under pressure as investors worried about Japan’s potential inclusion in the latest round of US tariffs. The Rupee extended its rally following suspected central bank intervention, while Vietnam’s Dong fell to a record low against the dollar.


EURUSD Faces Downside Risks Amid Tariff and Fed Policy Concerns


EURUSD remains steady around 1.0360 during Wednesday’s Asian session but could face depreciation as the US advances a plan for reciprocal tariffs. President Trump’s administration is considering executive action to match or exceed tariffs imposed on US exports, potentially targeting the EU, Japan, and China.


The Eurozone is particularly vulnerable, as it currently imposes a 10% duty on US automobile imports while benefiting from lower tariffs on its own exports. Additional trade tensions could weigh on the Euro.


Meanwhile, the US Dollar may strengthen after Fed Chair Powell signalled no urgency to cut interest rates, reinforcing a risk-off sentiment alongside Trump’s 25% tariff hike. These factors could add pressure on EURUSD in the near term.


In the commodities market, oil prices edged lower amid reports of a large increase in US crude stockpiles. Brent crude traded below $77 per barrel, while West Texas Intermediate hovered around $73. The American Petroleum Institute (API) reported a 9-million-barrel increase in US inventories, marking the largest build in a year if confirmed by official data.


Gold prices declined for a second consecutive session after briefly surging above $2,942 per ounce in volatile trading.


Market Outlook


As the global markets brace for inflation data and further Fed guidance, investors remain cautious. Powell’s testimony reaffirmed the Fed’s patient stance on rate adjustments, while geopolitical and economic uncertainties—ranging from trade tariffs to currency fluctuations—continue to influence market sentiment. Traders will be closely monitoring upcoming economic indicators for further direction on interest rates and inflation trends.
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: 11th February 2025.


Market Update: Tariffs, Inflation, and Investor Sentiment Shape Global Markets.



Trading Leveraged products is Risky


Asian equities and US stock index futures experienced declines. At the same time, gold surged to a record high, reflecting investor caution following President Donald Trump’s announcement of new tariffs on US imports of steel and aluminium. Stock markets in Hong Kong and mainland China faced selling pressure, contributing to a regional downturn. Futures contracts for the S&P 500, Nasdaq 100, and Euro Stoxx 50 also traded lower. Meanwhile, Japanese markets remained closed due to a public holiday.


Gold, often seen as a safe-haven asset duringeconomic uncertainty, extended its rally for a third consecutive session, briefly surpassing $2,942 before paring some gains. The US dollar index maintained its Monday gains, signalling sustained strength amid market volatility. The precious metal has surged about 11% this year, setting successive records as Trump’s disruptive moves on trade and geopolitics reinforce its role as a store of value in uncertain times.


US Steel and Metals Sector Reacts to Tariffs


Shares of US Steel Corporation surged as much as 6% following Trump’s announcement, as domestic metals producers saw a boost from the prospect of increased business and stronger pricing power. Canada, Brazil, and Mexico, the top steel suppliers to the US, are expected to be significantly impacted by these trade restrictions.


Trump stated that the new tariffs, effective in March, aim to revitalize domestic production and job growth. However, he also suggested the possibility of further tariff increases, adding to market uncertainty.





Investor Concerns Over Tariffs and Trade War Escalation


Investors are grappling with the implications of Trump’s tariffs, particularly in distinguishing between policy announcements and concrete actions. The uncertainty surrounding additional levies and potential retaliatory measures has reignited fears of an intensifying global trade war. Tariffs on Chinese goods are already in effect, and concerns persist about further economic fallout.


According to Christian Mueller-Glissmann, head of asset allocation research at Goldman Sachs, the key challenge in portfolio strategy now lies in identifying assets that can effectively hedge against tariff risks. Speaking to Bloomberg Television, he noted, “The big challenge is that this is going to be much more difficult from here because the tariffs are very specific.”


Key Economic Data and Federal Reserve Testimony in Focus


Beyond trade tensions, investors are closely watching this week’s critical economic reports and statements from Federal Reserve officials. Fed Chair Jerome Powell is set to testify before Congress, while fresh inflation data will provide further insight into price trends. According to the New York Federal Reserve’s Survey of Consumer Expectations, inflation expectations for both the one-year and three-year outlooks remained steady at 3% in January. Short-term US inflation expectations have now risen above longer-term projections to their widest gap since 2023, signalling potential shifts in monetary policy.


Inflation data, Powell’s congressional testimony, and tariffs are poised to drive the market today.


A reprieve from negative surprises, such as the impact of DeepSeek, ongoing tariffs, and consumer sentiment concerns, could push S&P 500 to break out of its two-month consolidation.





Currency and Commodity Markets React


The currency market also reflected shifting investor sentiment. The Japanese Yen remained largely unchanged. Meanwhile, the British Pound weakened after a report from the Financial Times cited Bank of England policymaker Catherine Mann’s concerns that weakening demand is beginning to outweigh inflationary risks.


Gold’s continued ascent has been accompanied by significant inflows into bullion-backed exchange-traded funds. Global holdings have risen in six of the past seven weeks, reaching their highest levels since November. Banks have forecast that gold could test the $3,000 mark, with Citigroup predicting it could hit that level within three months and J.P. Morgan Private Bank projecting a year-end target of $3,150.


Market Resilience Amid Trade Uncertainty


Despite ongoing tariff tensions, equities have demonstrated resilience, leading some analysts to caution that further trade escalations could trigger renewed market pullbacks. Strategists at Deutsche Bank AG, including Binky Chadha, suggested that historical patterns indicate sharp but short-lived equity selloffs during geopolitical events, with markets typically rebounding before any formal de-escalation occurs. They projected that, in such scenarios, equity markets could decline by 6%-8% over a three-week period before recovering in a similar timeframe.


China’s Growing Gold Reserves and Market Influence


China’s central bank expanded its gold reserves for the third consecutive month in January, signalling an ongoing commitment to diversifying its holdings despite record-high prices. In addition, China introduced a pilot program allowing 10 major insurers to invest up to 1% of their assets in bullion for the first time. This initiative could translate into as much as 200 billion Yuan ($27.4 billion) in potential gold investments.


Key Market Events to Watch This Week


* Fed Chair Jerome Powell’s semiannual testimony before the Senate Banking Committee today
* Speeches by Fed officials Beth Hammack, John Williams, and Michelle Bowman today
* US Consumer Price Index (CPI) report, Wednesday


As global markets continue to navigate economic uncertainties, investors remain watchful of trade developments, monetary policy signals, and inflation trends that could shape the financial landscape in the coming weeks.


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: 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.