Stocks rose on Tuesday with anticipation for the Federal Reserve’s meeting and Nvidia’s announcements boosting the tech sector. The major indices saw gains, while Treasury yields fell, indicating a cautious but optimistic market stance on interest rates amidst inflation concerns. Nvidia’s showcase of its new AI chip influenced tech stocks, though not all news was positive in the sector. The dollar gained strength, particularly against the yen, after Japan’s central bank policy update, highlighting the ongoing interplay between technology developments, monetary policy, and global financial markets.

Stock Market Updates

On Tuesday, stocks saw an uptick as the Federal Reserve initiated its two-day policy discussion, with investors closely monitoring Nvidia amidst significant announcements from the tech leader. The Dow Jones Industrial Average marked a notable increase, rising by 320.33 points or 0.83% to settle at 39,110.76, making it the best-performing day since February 22. The S&P 500 followed suit, achieving a new record by closing up 0.56% at 5,178.51, while the Nasdaq Composite grew by 0.39%, ending the day at 16,166.79. This optimistic trend emerged amidst expectations that the Federal Reserve might keep interest rates steady, despite a series of concerning inflation reports that hinted at a potential prolonged period of higher rates.

Treasury yields saw a general decline, offering a boost to the stock market; the benchmark 10-year Treasury yield dropped by over 4 basis points, reaching 4.295%. Nvidia, a major player in the semiconductor industry, saw its shares climb by approximately 1.1% after recovering from earlier losses. This shift in investor sentiment was influenced by the company’s unveiling of its latest artificial intelligence chip, Blackwell, at its first GTC Conference. Meanwhile, Super Micro Computer experienced a drop of about 9% following news of a share offering, despite the stock’s significant surge this year driven by AI excitement. Additionally, MicroStrategy saw a 5.7% decrease, signaling a potential cooldown in the recent bull run, despite the stock’s substantial growth in 2024 paralleled with Bitcoin reaching record highs.

Currency Market Updates

In anticipation of Wednesday’s Federal Reserve meeting, the dollar strengthened broadly, while the yen dropped significantly following the Bank of Japan’s meeting, which ended its negative rate policy and some ultra-loose policies but maintained key yield-suppressing operations. The USD/JPY pair surged by 1.2%, breaking through the year’s previous high and inching closer to the peaks of the last two years. This occurred despite a slight retreat in Treasury yields, reflecting a consolidation phase ahead of the Fed’s upcoming decisions. The market’s expectations for rate hikes have adjusted, with futures now indicating fewer increases than previously anticipated, amidst speculation about potential cuts in the Fed’s rate projections.

The gap between the U.S. Treasury and Japanese Government Bond yields remains a focal point, potentially influencing the USD/JPY pair to approach its recent highs, pending the outcome of the Fed meeting. The next significant data releases include the Core PCE index, the Fed’s preferred inflation measure, and upcoming reports on the U.S. labor market and manufacturing sector, which could further impact currency valuations. The housing market showed signs of resilience, possibly buoyed by the expectation of easing mortgage rates following the Fed’s actions later in the year.

The euro saw a slight decline against the dollar, recovering from an early drop to its monthly low. This movement was influenced by the German ZEW economic sentiment index, which, despite exceeding forecasts, was contrasted by persistently low current conditions and reduced labor and wage costs in the Eurozone. The European Central Bank has hinted at a possible rate cut, though market swaps suggest a mixed outlook. The sterling and the Australian dollar also faced challenges, with the latter affected by the Reserve Bank of Australia’s softened stance on tightening. The Canadian dollar’s gains were trimmed following disappointing inflation data, highlighting the dynamic and interconnected nature of global currency markets.

Picks of the Day Analysis

EUR/USD (4 Hours)

XAU/USD prices dip amid resurgent US dollar and central bank developments

Gold’s rally faced a setback as the US Dollar regained momentum, influencing XAU/USD to hover around $2,154 during the mid-American session. This shift was spurred by dovish stances from global central banks, notably the Reserve Bank of Australia (RBA) and the Bank of Japan (BoJ), which have recently adjusted their monetary policies. The RBA’s decision to keep rates steady, coupled with the BoJ’s rate hike—the first in 17 years—and the discontinuation of its Yield Curve Control (YCC) program, underscored a cautious approach to achieving sustainable inflation levels. Despite these developments, the US Dollar saw a slight retreat from its peak levels as Treasury yields decreased, reflecting cautious anticipation among investors for the upcoming Federal Reserve decision and economic projections. This atmosphere of vigilance suggests that gold prices may continue to be influenced by central bank policies and the broader economic outlook, especially with the Fed’s potential stance on interest rates amid current economic indicators.

Chart XAU/USD by TradingView

On Tuesday, XAU/USD consolidated between the lower and middle bands of the Bollinger Bands. Currently, the price is moving at the middle band of the Bollinger Bands, suggesting a potential awaited moment for gold before the FOMC meeting. Notably, the Relative Strength Index (RSI) maintains its position at 48, signaling a neutral outlook for this pair.

Resistance: $2,172, $2,195

Support: $2,147, $2,123

 Economic Data

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Please note that the dividends of the following products will be adjusted accordingly. Index dividends will be executed separately through a balance statement directly to your trading account, and the comment will be in the following format “Div & Product Name & Net Volume ”.

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On Monday, Wall Street experienced a positive shift, with stocks climbing as investors’ attentions were riveted by a major artificial intelligence conference and the anticipation of new guidance from the Federal Reserve’s policy meeting. The Dow Jones, S&P 500, and Nasdaq Composite all saw gains, buoyed by Nvidia’s promising outlook at its GTC Conference and Alphabet’s stock surge amid reports of Apple incorporating Google’s Gemini AI into iPhones. This optimism comes after a period of tech-led losses, suggesting a potential pivot towards tech investments as the market anticipates the Fed’s upcoming decisions on interest rates, amidst mixed signals from inflation readings and global economic indicators.

Stock Market Updates

On Monday, the stock market saw a positive uptick as investors’ attention turned towards a major artificial intelligence conference and anticipation built for new guidance from the Federal Reserve on monetary policy. The Dow Jones Industrial Average experienced a modest rise, gaining 75.66 points to close at 38,790.43, marking a 0.2% increase. Similarly, the S&P 500 rose by 32.33 points, ending the day up 0.63% at 5,149.42, while the Nasdaq Composite outperformed, climbing 0.82% to finish at 16,103.45.

The spotlight was on Nvidia as its shares went up by 0.7% with the commencement of the company’s GTC Conference. Expected to unveil the latest advancements in artificial intelligence, Nvidia’s stock received a positive response from analysts, with predictions of significant upside potential. Similarly, Alphabet’s stock surged by 4.6% following reports of Apple’s negotiations to integrate Google’s Gemini AI into its iPhones. These developments contributed to a positive market sentiment, especially after a period marked by tech-led declines in the S&P 500 and Nasdaq Composite, while the Dow Jones suffered losses for three consecutive weeks.

Investor focus is also heavily on the Federal Reserve’s policy meeting set to begin on Tuesday and conclude with an announcement on Wednesday. With the market pricing in a 99% likelihood of unchanged interest rates at this week’s meeting, attention is equally divided over potential rate cuts expected in June. However, recent hotter-than-expected inflation readings have raised concerns about the Fed maintaining higher interest rates for an extended period, complicating the market’s anticipation.

Currency Market Updates

In currency markets, the dollar index saw a slight increase as attention turned to key meetings of the world’s major central banks, including the Federal Reserve, with particular interest in any changes to monetary policy. This comes amid a complex backdrop of fluctuating expectations for rate cuts, resilient U.S. economic indicators, and varying forecasts for interest rate movements among the world’s central banks. As investors navigate through these uncertainties, the outcomes of these meetings are eagerly awaited for their potential impact on global financial markets.

Picks of the Day Analysis

EUR/USD (4 Hours)

EUR/USD faces downward pressure amid strengthening US dollar and divergent central bank paths

The EUR/USD pair has been experiencing a downward trend, largely influenced by the strengthening US Dollar, as indicated by its subdued trading levels below the 1.0900 mark and reaching multi-day lows around 1.0865-1.0870. This movement correlates with the US Dollar Index (DXY) approaching a key technical level, amid a backdrop of rising US yields and expectations of divergent monetary policies from the Federal Reserve and the European Central Bank (ECB). Despite both central banks anticipated to start easing cycles, differences in their approaches could further impact the EUR/USD trajectory. With the euro area’s weaker fundamentals and a resilient US economy, the medium-term outlook suggests a potentially stronger Dollar, pushing EUR/USD towards its year-to-date lows and possibly lower, highlighting the significance of upcoming central bank decisions and their impact on currency dynamics.

Chart EUR/USD by TradingView

On Monday, the EUR/USD moved lower and moving near the support level. Currently, the price is moving between the middle and lower bands of the Bollinger bands, suggesting a potential lower movement, and may reach the lower band. Notably, the Relative Strength Index (RSI) maintains its position at 33, signaling a bearish outlook for this currency pair.

Resistance: 1.0917, 1.0984

Support: 1.0859, 1.0812

 Economic Data

Dear Client,

Please note that the dividends of the following products will be adjusted accordingly. Index dividends will be executed separately through a balance statement directly to your trading account, and the comment will be in the following format “Div & Product Name & Net Volume ”.

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As we approach another pivotal week in financial markets, our focus turns sharply to the Federal Reserve’s upcoming policy decisions and their potential impact on global markets. In light of recent developments and forward-looking economic indicators, here is VT Markets’ professional and insightful weekly market outlook. 

Federal Reserve’s monetary policy stance: The financial community eagerly anticipates the Federal Open Market Committee’s (FOMC) next moves, especially regarding interest rate adjustments and the pace of quantitative tightening. The Fed’s delicate balancing act continues as it aims to navigate through economic recovery, inflation concerns, and market stability. 

Quantitative tightening and market liquidity: A significant area of interest lies in the Fed’s approach to quantitative tightening (QT). With bank reserves currently at a comfortable US$3.6 trillion, thanks to pandemic-induced quantitative easing, the market is awash with liquidity. However, the Fed’s QT program, designed to reduce the balance sheet by not reinvesting in bonds that mature, has been proceeding at a slower pace than the projected US$95 billion per month. This slower pace suggests that the reduction in bank reserves and the impact on market liquidity may be more gradual than initially feared. 

Looking ahead to 2024 and beyond: Considering the current pace, the Fed’s QT program is expected to continue well into 2024, possibly extending comfortably into 2025. Despite some market speculation about a potential exit or slowdown plan for QT, our analysis suggests that immediate concerns regarding liquidity are unwarranted for the foreseeable future. The Fed has ample room to adjust its policies as necessary, without inducing panic in the financial markets. 

Market implications: Investors and traders should monitor the Fed’s guidance closely, as it will shape market sentiment and rate expectations in the coming months. While the upcoming FOMC meeting may not be a major market mover on its own, the accumulated economic data and the Fed’s interpretation of it will undoubtedly influence investment strategies and decisions. 

VT Markets’ stance: At VT Markets, we advise clients to maintain a balanced and informed perspective as we navigate these uncertain times. Diversification, vigilance, and a keen eye on central bank communications will be key to successfully managing investment portfolios. As always, our team of analysts and strategists is here to provide you with the latest insights and strategies to optimize your market positioning. 

Conclusion: The week ahead promises to shed further light on the Fed’s monetary policy direction and its implications for global financial markets. By staying informed and agile, investors can navigate these challenges and capitalize on opportunities as they arise. 

Stay tuned to VT Markets for ongoing analysis and insights into market trends and economic forecasts. 

Dear Client,

Please note that the dividends of the following products will be adjusted accordingly. Index dividends will be executed separately through a balance statement directly to your trading account, and the comment will be in the following format “Div & Product Name & Net Volume ”.

Please refer to the table below for more details:

The above data is for reference only, please refer to the MT4/MT5 software for specific data.

If you’d like more information, please don’t hesitate to contact [email protected].

Dear Client,

As part of our commitment to provide the most reliable service to our clients, there will be MT5 server, VT APP and Client Portal maintenance this weekend.

The MT4 software remains unaffected by this maintenance and will continue to facilitate transactions without interruption.

Maintenance Hours :
16th of March 2024 (Saturday) 00:00 – 24:00 (GMT+3)

Please note that the following aspects might be affected during the maintenance:

1. The password for your MT5 trading account is set to be reset, once you log into the MT5, you will be asked to reset the trading account password. Also, you can log into your client portal to reset the password.

2. The order “number” associated with your trading account will be renewed. Except for the order number, all other settings of the position will remain unchanged.

3. Please be advised that your MT5 Demo account is set to expire. Should you require continued access, kindly create a new MT5 demo account through the client portal.

4. Kindly be advised that the functionality of the Client Portal and VT APP will be temporarily unavailable during the maintenance period, thereby hindering normal login operations. It is strongly recommended to refrain from engaging in account service management activities throughout the maintenance period.

5. The price quote and trading management will be temporarily disabled during the maintenance. You will not be able to open new positions, close open positions, or make any adjustments to the trades.

6. Should you be using the MT5 PAMM service, it is imperative to be mindful of the following considerations:

6-1. Open positions will be automatically closed if the Master fails to close them before the update on March 16th. It is suggested that the Master closes the open positions in advance.

6-2. The history on the PAMM Portal will be reset and saved in the “Archive”. On the PAMM portal, Money Manager can turn on “Show archive” button to see the history records.

6-3. The High Water Mark (HWM) value will be reset. However, we will retain the latest HWM before the update. Therefore, any excessively generated Performance Fee (PMF) will be deducted and returned to the investors until the PMF is charged with the correct amount.

There might be a gap between the original price and the price after maintenance. The gaps between Pending Orders, Stop Loss and Take Profit will be filled at the market price once the maintenance is completed. It is advised to exercise diligence in monitoring position control.

Please refer to MT5 for the latest update on the completion and market opening time. Our services will be back online once the maintenance is completed.

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The Dow Jones Industrial Average ended its three-day winning streak with a decline on Thursday, driven by unexpectedly high U.S. inflation data that also saw Treasury yields climbing. The producer price index for February indicated a higher-than-anticipated rise in wholesale inflation, causing a stir in the stock and bond markets. Major technology stocks like Apple and Microsoft remained in favor, while Nvidia and electric vehicle startup Fisker faced setbacks. The inflation report, critical to the Federal Reserve’s upcoming policy decisions, influenced the bond and currency markets, setting a cautious tone ahead of the Fed’s next meeting. Investors and analysts are now recalibrating their expectations for interest rates and market direction, highlighting the ongoing challenges in predicting economic trends amidst fluctuating inflation rates.

Stock Market Updates

The Dow Jones Industrial Average experienced a downturn on Thursday, ending a three-day winning streak as unexpectedly high U.S. inflation data prompted a rise in Treasury yields, placing additional pressure on shares of Nvidia. The Dow dropped by 137.66 points, a 0.35% decrease, settling at 38,905.66. Similarly, the Nasdaq Composite and the S&P 500 saw declines, falling 0.3% and 0.29% to close at 16,128.53 and 5,150.48, respectively. This downturn came in the wake of the February producer price index (PPI) report, which indicated a 0.6% increase in wholesale inflation, exceeding economist predictions.

The rise in the producer price index, particularly with a 0.6% leap last month and a core PPI (excluding food and energy prices) increase of 0.3%, surpassed Dow Jones economists’ expectations. These economists had anticipated a more modest 0.3% gain for the headline PPI and a 0.2% increase for the core measure. Initially, the stock market showed resilience in response to the report but began to falter shortly after the trading day began, reflecting investors’ concerns about the implications of persistently high inflation on future Federal Reserve rate decisions and the potential impact on the stock market rally’s momentum.

The inflation report’s aftermath saw bond yields on the rise, with the benchmark 10-year Treasury yield climbing approximately 10 basis points to 4.29%. Nvidia’s shares were notably impacted, marking a decline for the fourth time in five sessions, with a pullback of over 3%. Market strategists and investors are now grappling with questions about the direction of yields and the market’s trajectory, with expectations of further downside if yields continue to ascend.

On the technology front, major stocks like Apple and Microsoft drew investor interest despite the overall market downturn. Robinhood’s shares surged by 5% following a report of a 16% increase in assets under custody compared to the previous month. In contrast, the electric vehicle sector witnessed Fisker’s shares plummeting nearly 52% amid reports of potential bankruptcy preparations, showcasing the varied investor responses across different sectors.

Currency Market Updates

Currency and commodity markets also reacted to the inflation and employment data, influencing expectations for the Federal Reserve’s upcoming policy meeting. The dollar strengthened against major currencies, and oil prices surged, adding to inflationary pressures. Investors and analysts are now closely watching the Federal Reserve’s next moves, with the upcoming policy meeting poised to provide further direction amidst ongoing economic uncertainties.

Picks of the Day Analysis

EUR/USD (4 Hours)

EUR/USD weakens amid strong US dollar and anticipated central bank easing

The EUR/USD pair exhibited increased weakness, reaching weekly lows below 1.0900, driven by a resurgence in the US Dollar’s strength amid positive US economic data and rising US yields. This development comes as both the US and European economies prepare for anticipated easing cycles by the Federal Reserve and the European Central Bank, potentially starting in June. Despite similar timelines for rate cuts, the differing economic fundamentals between the eurozone and the US, particularly the robust US economy and its tighter labor market, hint at a medium-term advantage for the Dollar. Consequently, EUR/USD faces the prospect of further corrections, possibly testing significant lows not seen since late 2023.

Chart EUR/USD by TradingView

On Thursday, the EUR/USD moved lower and reached the lower band of the Bollinger Bands. Currently, the price is moving just around the lower band, suggesting a potential higher movement, and may reach the middle band. Notably, the Relative Strength Index (RSI) maintains its position at 31, signaling a bearish outlook for this currency pair.

Resistance: 1.0917, 1.0984

Support: 1.0859, 1.0812

 Economic Data

Dear Client,

Please note that the dividends of the following products will be adjusted accordingly. Index dividends will be executed separately through a balance statement directly to your trading account, and the comment will be in the following format “Div & Product Name & Net Volume ”.

Please refer to the table below for more details:

The above data is for reference only, please refer to the MT4/MT5 software for specific data.

If you’d like more information, please don’t hesitate to contact [email protected].

On Wednesday, the stock market experienced a slight downturn, with the S&P 500 and Nasdaq Composite falling due to a pullback in tech shares, including notable declines in Nvidia, Meta Platforms, and Apple. This shift came after a record-setting session, spurred by U.S. inflation data that met expectations, causing investors to remain cautious about future Federal Reserve actions. Amid this backdrop, the dollar index saw a modest decline, and attention is now turned to upcoming economic data releases and central bank meetings, which will further guide market sentiment and monetary policy outlooks.

Stock Market Updates

The stock market experienced a slight retreat on Wednesday, following a record-breaking session the previous day, with the S&P 500 index falling by 0.19% to close at 5,165.31. The tech-heavy Nasdaq Composite also saw a decline, dropping 0.54% to end the day at 16,177.77. Conversely, the Dow Jones Industrial Average managed a modest gain, adding 37.83 points to close at 39,043.32. This shift in market dynamics was partly due to a cooldown in Nvidia’s shares, which fell by 1.1%, contributing to broader losses in the tech sector, including declines in Meta Platforms and Apple shares.

The decline in tech stocks, including a 2% slide in the VanEck Semiconductor ETF, reflects a broader trend of profit-taking following significant gains in the sector, particularly after Tuesday’s rally. According to Adam Crisafulli, founder and president of Vital Knowledge, despite the day’s pullback, the sentiment towards AI and data centers remains overwhelmingly positive, fueled by anticipation for Nvidia’s upcoming GTC conference. This optimism comes in the wake of a winning session on Wall Street, buoyed by U.S. inflation data for February aligning with expectations, which had previously ignited a more than 1% jump in both the S&P 500 and Nasdaq.

The recent U.S. inflation report indicated a rise in core inflation, stripping out food and energy costs, which was higher than anticipated last month. This has led to a cautious approach among investors, as explained by Ayako Yoshioka, senior portfolio manager at Wealth Enhancement Group. With the Federal Reserve’s monetary policy and the upcoming meeting on March 19 in sharp focus, investors are keenly observing for signs of how the central bank will address these inflation trends, with Fed Chair Jerome Powell expected to maintain a data-dependent and neutral stance.

Concerns over inflation are further compounded by the increasing costs in the services sector, suggesting that the economic landscape might be more complex than initially perceived. This nuanced view of the economy is crucial as investors and analysts alike parse through the latest CPI data, seeking indications of future monetary policy directions. Moreover, the market is also reacting to corporate news, such as Dollar Tree’s 14% drop following its fourth-quarter results, with more inflation data expected to be released soon, providing further insights into the economic climate. 

Currency Market Updates

On the currency front, the dollar index saw a slight decline of 0.22%, erasing recent gains spurred by job and CPI reports that had previously lifted Treasury yields. This comes ahead of crucial data releases set for Thursday, which are expected to influence the Federal Reserve’s projections for interest rate adjustments in the coming year. Meanwhile, the EUR/USD pair gained, and the market is closely monitoring the European Central Bank’s rate decisions, amid a global financial landscape attentively awaiting the next moves by major central banks, including the Federal Reserve and the Bank of Japan, in response to inflationary pressures and economic data.

Picks of the Day Analysis

EUR/USD (4 Hours)

EUR/USD gains ground amid weaker dollar and anticipation of central banks’ easing measures

On Wednesday, the EUR/USD pair saw an uplift, reaching three-day highs in the 1.0960/65 range as the US Dollar weakened, driven by a growing appetite for risk and a drop in the USD Index below the 103.00 mark. This movement coincided with a rise in both US and German bond yields, reflecting broader financial market trends. Despite expectations for the Federal Reserve and the European Central Bank to begin easing monetary policy by early summer, likely in June, the pace of interest rate cuts could differ between the two, adding an element of uncertainty. However, the prospect of simultaneous easing measures by both banks, against the backdrop of a stronger US economy compared to the euro area’s slower fundamentals, suggests a potential medium-term strengthening of the Dollar. This scenario hints at a possible correction for the EUR/USD, initially towards its year-to-date low of around 1.0700, with further downside potential in the longer term.

Chart EUR/USD by TradingView

On Wednesday, the EUR/USD moved higher and reached the upper band of the Bollinger Bands. Currently, the price is moving just below the upper band, suggesting a potential higher movement, and may reach the resistance level. Notably, the Relative Strength Index (RSI) maintains its position at 62, signaling a bullish outlook for this currency pair.

Resistance: 1.0984, 1.1079

Support: 1.0907, 1.0812

 Economic Data