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.

Thank you for your patience and understanding about this important initiative.

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

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

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 Tuesday, financial markets experienced significant gains following the release of U.S. inflation data that aligned with expectations, fueling a surge in tech stocks like Nvidia, Meta Platforms, and Oracle. The Dow Jones, S&P 500, and Nasdaq all posted notable increases, with the S&P 500 hitting a new record high. Meanwhile, the consumer price index’s rise mirrored forecasts, sustaining investor hopes for a Federal Reserve rate cut in June. In the currency sector, the dollar strengthened against major currencies, reacting to the inflation report and Treasury yield movements, setting the stage for the upcoming Fed meeting and economic indicators release.

Stock Market Updates

On Tuesday, the stock market witnessed notable gains, driven by U.S. inflation data that aligned with expectations, fueling investor enthusiasm towards tech giants such as Nvidia and Meta Platforms. The Dow Jones Industrial Average rose by 235.83 points (0.61%) to 39,005.49, the S&P 500 increased by 1.12% to a record close of 5,175.27, and the Nasdaq Composite advanced by 1.54% to 16,265.64. Notable movers included Nvidia, which jumped over 7%, Microsoft and Meta with increases of 2.6% and 3.3% respectively, and Oracle, which surged more than 11% following earnings that surpassed Wall Street’s forecasts.

The inflation update, with the consumer price index (CPI) rising by 0.4% for February and 3.2% year-over-year, was closely watched by the market. These figures met economists’ expectations and signaled a stabilizing inflation environment, albeit with core inflation rising slightly above forecasts at 0.4%. This data prompted analysts to maintain their outlook for a potential Federal Reserve rate cut in June, despite acknowledging the unpredictable path to the Fed’s 2% inflation target. 

Currency Market Updates

In the currency markets, the dollar index experienced a slight uplift of 0.2%, responding to the inflation data that pushed Treasury yields higher and adjusted the market’s expectations for Federal Reserve rate cuts in 2024. The yield on two-year Treasuries increased, and the overall sentiment shifted slightly, reducing the anticipated Fed rate cuts for the year, though a cut in June is still highly probable. The EUR/USD pair showed resilience, bouncing back after an initial drop, as market participants digested the implications of the CPI data and its impact on U.S. and European interest rate differentials.

Investors are now redirecting their focus towards other significant economic indicators and events, including the upcoming U.S. retail sales, Producer Price Index (PPI), and jobless claims reports. These data points, alongside the next Federal Reserve meeting scheduled for March 19-20, are expected to provide further clarity on the economic landscape and the central bank’s monetary policy direction. Additionally, the currency market remains attuned to developments around the globe, including the Bank of Japan’s potential rate decisions and the economic recovery signals from the U.S. and Europe.

As the financial world looks ahead, the anticipation builds for the Federal Reserve’s next moves, especially in light of recent economic data and global financial trends. The market’s reaction to the inflation reports, combined with upcoming economic indicators, underscores the delicate balance the Fed seeks to maintain between fostering economic growth and controlling inflation. With discussions and speculations around interest rate paths and policy adjustments, investors and analysts alike remain vigilant, ready to adapt to the evolving economic narrative.

Picks of the Day Analysis

EUR/USD (4 Hours)

EUR/USD extends decline amidst US dollar resurgence and inflation concerns

The US Dollar’s (USD) continuous recovery has applied additional pressure on EUR/USD, resulting in the pair’s decline for the third consecutive session towards the 1.0900 support level. This movement coincides with the USD Index (DXY) experiencing an uptick to the 103.20 area, driven by higher-than-anticipated US Consumer Price Index (CPI) inflation figures. The resurgence in the Dollar is echoed by gains in US yields across various maturities, paralleled by the German 10-year bund yields nearing 2.35%.

With both the Federal Reserve (Fed) and the European Central Bank (ECB) anticipated to start their easing cycles in early summer, likely in June, the focus shifts to the pace at which interest rate cuts will unfold. Although the ECB may not significantly trail the Fed in this regard, the central banks’ strategies could highlight differences in their approaches to monetary policy easing.

Market sentiment, as gauged by the FedWatch Tool from CME Group, now shows an increased probability of about 60% for a rate cut in June. This adjustment in expectations comes amidst a backdrop where the solid resilience of the US economy starkly contrasts with the euro area’s more subdued fundamentals. This dynamic fosters a medium-term outlook favoring a stronger Dollar, especially with both central banks on the verge of commencing their easing programs nearly in tandem. Under such conditions, EUR/USD may face a deeper correction, initially aiming for its year-to-date low around 1.0700, with a potential extension towards the late October 2023/early November lows in the 1.0500 vicinity.

Chart EUR/USD by TradingView

On Tuesday, the EUR/USD moved lower and reached the lower band of the Bollinger Bands. Currently, the price is moving just below the middle band, suggesting a potential higher movement, and may reach the upper band. Notably, the Relative Strength Index (RSI) maintains its position at 54, signaling a neutral outlook for this currency pair.

Resistance: 1.0984, 1.1079

Support: 1.0907, 1.0812

 Economic Data

Dear Client,

To provide you with more diverse trading options, VT Markets will launch 1 new product on 18th Mar 2024.

You can now trade the world’s popular products on MetaTrader 4 and 5 with the following specifications:

The above data is for reference only, please refer to the MT4 and MT5 platforms for the updated data.

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

Sydney, Australia, 12 March, 2024 – VT Markets proudly proclaims the successful conclusion of its esteemed trading festival, the King of the Hill Trading Contest, which ran from November 2023 to January 2024. Building upon the momentum of the previous edition, this latest illustrious contest not only captivated the global trading fraternity but also set new standards of excellence and international camaraderie.

The King of the Hill Trading Contest 2023-2024 marked another milestone for VT Markets, with over a thousand participants from various corners of the world showcasing their trading prowess. This diverse participation underscored the truly global reach of VT Markets, as traders from different regions converged in a spirited competition.

This edition of the contest saw several millions of dollars being traded across the 3 months, demonstrating the scale and significance of the event within the trading community. While the focus remained on the thrill of competition and the pursuit of excellence, the contest also served as a platform for traders to engage, learn, and grow their skills.

Reflecting on the success of the contest, a spokesperson from VT Markets expressed gratitude towards the vibrant community of traders who contributed to its success. “The King of the Hill Trading Contest continues to surpass expectations, thanks to the passion and dedication of our participants,” said the spokesperson. “We are thrilled to see traders from around the world come together to compete and showcase their abilities. This event truly embodies the spirit of innovation and excellence that makes VT Markets special.”

One winner from Spain, wanting to be known as Lopez said, “Participating in the King of the Hill Trading Contest has been a transformative journey. It’s not just about profits; it’s about the camaraderie, the learning, and the sheer exhilaration of pushing one’s personal growth targets. VT Markets has truly crafted a platform that inspires greatness.”

As the competition concludes and the VT Markets team presents prizes to the winners of the King of the Hill Trading Contest, look ahead with excitement to future opportunities and initiatives. Traders are encouraged to stay tuned for upcoming campaigns and events that promise to deliver excitement and rewards.

For all the latest news and updates from VT Markets, please visit our official website and stay connected with us on social media. Thank you to all participants, supporters, and partners who made the King of the Hill Trading Contest a remarkable success.

About VT Markets:

VT Markets is a regulated multi-asset broker with a presence in over 160 countries. To date, it has won numerous international accolades including Best Customer Service and Fastest Growing Broker.

In line with its mission to make trading accessible to all, VT Markets currently offers unfettered access to over 1,000 financial instruments and a seamless trading experience via its award-winning mobile app.

For more information, please visit the official VT Markets website or email us at [email protected]. Alternatively, follow VT Markets on Facebook, Instagram, or LinkedIn.

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