Check out the news of the past 24 hours

  1️⃣ Yield gains will not stop anytime soon, and USD will continue to benefit

 - The dollar fell in early European session on Tuesday, but remains near a multi-month high thanks to solid treasury bond yields and strong expectations for the US economy to recover.

 Another test for the market and the USD would be the sale of 3-year Treasury bonds, a week after a match.  Less well-received 7-year bond prices triggered a yield hike.  Three-year bonds are more sensitive to short-term rates and therefore the bid will suggest a time when investors expect the Fed to start raising interest rates.

 Driven by the dollar's rise this year is also on positive economic data, analysts have revised their forecasts for U.S. growth higher while tending to revise down forecasts.  for other countries.

 2️⃣ ECB Members: Dual recession was no longer the most important problem

 The comment of the Governor of the Bank of France, Francois Villeroy de Galhau has the following notable points:

 - French economic growth this year may reach at least 5%;

🌈🌈Good morning!  Have a nice day!

- The French Central Bank estimates that the French economy will avoid a double recession, stable economic performance leading to “slight” growth in Q1;

 - I think having a double recession does not matter much, because the focus is now not on how things are going in Q1 but on how much the eurozone economy could grow in the second half of 2021 - especially  especially in the summer months;

 - Vaccine deployment and reopening the economy are more important factors at present;

 3️⃣ Notable facts and economic data today

 - At tonight, the US monthly CPI will be announced in February, is expected to be 0.4%, compared with the previous value of 0.3%.  If the data is higher than expected, it could become the catalyst for further increases in US Treasury yields.

 - The US House of Representatives is expected to consider and pass the stimulus bill

 - The Bank of Canada announced its interest rate decision.  The market is not expected to change interest rates, focus on the Canadian dollar, inflation and debt buying.

 - US EIA crude oil inventories are announced for the week to March 5th. The market is expected to drop 833,000 barrels, while API inventories are announced at the beginning of the morning.  now recorded an unexpected increase.

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DOW JONES & CRUDE OIL PRICE OUTLOOK

DOW JONES & CRUDE OIL FORECAST: WILL A CRUDE BREAKOUT BOOST THE DOW?

The Dow Jones trades at record levels once again after recovering from market turbulence in late January. Not to be outdone, crude oil prices have climbed to their highest levels since January 2020. Encouragingly for the Dow, the recent breakout in the fossil fuel should serve as a tailwind for energy stocks and could translate into greater gains for indices with energy exposure.

That said, the Dow Jones Industrial Average is not what it once was and its exposure to energy has slowly dwindled in recent years. The fall from grace suffered by energy stocks was acutely exemplified when Exxon Mobil (XOM) was removed from the Industrial Average in August 2020 after holding a spot on the index since 1928. XOM shares have outperformed the broader market in the year-to-date, but this outperformance has not been shared with the Dow Jones.

With that in mind, traders searching for exposure to energy stocks in the event crude oil looks to climb higher might find tighter correlations in single stocks or the exchange-traded funds like XLE.

Further still, USD/CAD typically enjoys an inverse correlation with crude oil, meaning if crude prices continue to rise, the pair may fall under pressure. Combined with the reversal in recent USD strength, USD/CAD might serve as a potential proxy for macro traders looking to ride crude oil strength.

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GOLD NEWS HEADLINES- Money Life Research

Gold went down last week because of advances in vaccines stimulating the outlook for a recovery from the coronavirus pandemic. The metal's appeal as a secure haven is diminishing as investors compare this view to the likelihood that further stimulus could weaken the dollar and approach consumer prices.

Gold was steady after the most important two-day gain during a month as investors weighed prospects for more stimulus within the U.S. and therefore the possibility of upper consumer prices against attention on Bitcoin and stocks at a record.

Bullion rose on Monday as Democrats released the primary draft of key legislation which will comprise President Joe Biden’s Covid-19 relief bill. Bets on a strong package are helping to underpin market-derived inflation expectations, which are at multi-year highs, and have fanned the so-called reflation trade.

Gold is rebounding after last week’s get back rock bottom level since the beginning of December when a stronger dollar and rising U.S. Treasury yields weighed on the haven asset that doesn’t offer interest. A report on Wednesday is forecast to point out U.S. consumer prices rising at a quickening pace.

“Gold is rallying from a two-month low as Biden’s massive $1.9 trillion plan is close to becoming a reality,” said Edward Moya, senior analyst at Oanda Corp. “The economic recovery is weak, and prospects are growing that more is going to be done. The reflation trade is occurring tons faster than expected.”

Spot gold was steady at $1,832.68 an oz by 8:25 a.m. in Singapore, after a 2.1%, two-day gain. Silver rose with platinum, while palladium was little changed. The Bloomberg Dollar Spot Index was flat after easing 0.1% Monday.

Meanwhile, traders were also watching a surge in Bitcoin, which hit a record on Monday after Tesla Inc. bought $1.5 billion of the cryptocurrency. The automaker said revised policies also permit it to take a position in gold.

KEY POINTS

The price of gold was way oversold, and this has provided the right catalyst for retracement later last week.

Non-farm payroll data has reaffirmed the necessity for an additional round of stimulus, which can help the gold price to recover.

Important levels: 1,784, 1,814, 1,827, and 1,848.

USD Dollar Update Today's

 

USD: Dollar correlations with other stalling asset groups

The trade-weighted dollar is up from its lows in early January by just over 2 percent. The declining negative correlation of the dollar with stock markets is noticeable and it is difficult to put a finger on what drives this. True, US yields have picked up marginally, but last week's increase in German Bund yields matched that of US Treasuries. And, of course, the US vaccine roll-out looks far more promising than in Europe, while year-to-date returns in the US S&P 500 are just slightly higher than those of the Eurostoxx 50. Here, heavy short dollar positioning is likely to play a major role and would again seem vulnerable if any portion of the employment data for non-farm payrolls were welcomed positively. After the 140k decline in December, Consensus is looking for around a 100k gain. Any upside surprise might see DXY extend its rally at 91.88 to the 100-day moving average, but we still prefer to see this as a rally for the bear market.

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Mid- Morning Market Report- Money Life Research

The main index of Bursa Malaysia reversed its earlier gains and dipped in the mid-morning as glove makers and plantation stocks dragged against a backdrop of mixed regional markets.

At 10am, the FBM KLCI had fallen 2.82 points to 1,582.08. The index earlier rose to a high of 1,590.47.

The decliners included Nestle (Malaysia) Bhd, Kuala Lumpur Kepong Bhd (KLK), Supermax Corp Bhd, Unisem (M) Bhd, Top Glove Corp Bhd, PPB Group Bhd, United Plantations Bhd, and Batu Kawan Bhd.

The actively traded stocks included i-Stone Group Bhd, Trive Property Group Bhd, Luster Industries Bhd, QES Group Bhd, Iris Corp Bhd, and Fintec Global Bhd.

The gainers included Malaysian Pacific Industries Bhd, Genetec Technology Bhd, See Hup Consolidated Bhd, and Hong Leong Bank Bhd (HLB).

E-mini futures for the S&P 500 and Hong Kong's Hang Seng Index futures were essentially flat, while Japan's Nikkei 225 futures inched 0.1% higher, it said.

Bursa Malaysia Stock Tips

BITCOIN (BTC/USD) PRICE CHART: HOURLY TIME (JANUARY 2021 – FEBRUARY 2021)

Bitcoin has been on the backfoot since timing another record on January 8, tumbling from $42,000 to beneath $29,000 in January alone. While theoretical lunacy was occurring somewhere else, well-known revenue in Bitcoin appeared to blur, in any event immediately, and the biggest digital currency by market cap looked defenseless against additional misfortunes.

In my past Bitcoin standpoint update, we featured an assortment of obstruction from the $35,000 to $36,000 region which we noted may see Bitcoin bit by bit drain lower except if broken. Indeed, the hindrance was immediately thrown away after Mr. Musk's intercession. Accordingly, what seemed to be imposing opposition was broken and Bitcoin got away from the arrangement of lower-highs and lower-lows that were starting to frame a bearish example on the graph. Thus, the specialized break started by Tesla's Chairman may have permitted Bitcoin to dodge further decreases.

A move past the January 29 high could see BTC/USD drive even higher, with ensuing opposition around the $40,000 mark – which corresponds with the January 14 pinnacle – and the record-breaking high around $42,000. 

Then again, uphold from the $30,000 to $28,000 territory stays a significant milestone for bulls. Should value break underneath the zone, BTC could quicken descending as help is moderately inadequate until the Fibonacci level around $24,230. On account of ongoing increases, earlier opposition around the $35,000 may likewise go about as help to go ahead.

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Us Dollar Fall Down

 The US dollar had a bounce in January from a 34-month low.  The DXY index recorded an increase of 0.71% monthly.  The strength of the US Dollar seems to correspond to an increase in demand for safe-haven currencies as market sentiment worsens and volatility accelerates.

 This relationship is highlighted by the generally positive correlation between the DXY Index and the S&P 500 based on the VIX Index.  The bulls of the US Dollar may find the impetus to take another step forward if the trader's risk appetite continues to decline and pushes the VIX's 'fear gauge' higher.  However, selling pressure in USD is likely to continue if there is a lower pullback in the VIX Index compared to current levels.

Looking at the daily chart of the US Dollar Index, we can see that an inverse head and shoulders pattern appears to have formed.  This makes the potential for a bullish reversal into the spotlight, which can be confirmed by a break above the 91.10 price level.  Overcoming this obstacle can get you quickly moving to the 92.00 handle that is almost reinforced by the 100-day simple moving average.

 Though, the US Dollar is currently facing technical resistance due to its negative sloping 50-day moving average.  Not to mention, the upper Bollinger Band may continue to conceal the rally of the US Dollar.  The sustained rebound could be destroyed if the DXY fails to defend the short-term uptrend line connecting the chain of lower levels since Jan. 6.

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