Currencies
EUR/USD – moved sharply up as the USD moved down although we are seeing the opposite occurring this morning. It is still very much possible that we will break below the lows of last week if we will get a bullish FOMC statement on Wednesday as that should strengthen the USD even further, especially in light of the recent ECB decision to extend QE.
USD/JPY – for now was unable to break through the resistance around the 115.82 level but we have seen that it doesn’t take that long before it does break through resistance levels in recent weeks. Could it be different this time with the FED rate decision tomorrow? We will also be looking at the Japanese data which will be released this night.
GBP/USD – is looking for an important week with obviously the FED rate decision, but the next day, on Thursday, also the BOE will decide on the interest rate, although no change is expected. More interesting will be to look at the meeting minutes to see how they see the economy performing. Tomorrow we also have unemployment data and today inflation data, so enough trading opportunities here. As the USD weakened yesterday, we saw the GBP strengthen again quite a lot. Brexit could come into play again later this week as well as the EU will start to forge a negotiation strategy for the Brexit talks later on Thursday.
USD/CAD – we are able to see that the support is able to hold on for now. We will be waiting to see what will happen with the oil price as that has a big influence on the CAD and also wait to see what the FED will decide on Wednesday, which obviously impacts the USD.
Bitcoin – after breaking through the resistance around the 665 level back in October it has continued to move further up and gained another $100 to reach the highest levels since the beginning of 2014.
Indices
China A50 – continues to move down, even though the data out of China was strong. This is most likely because the strong data is also increasing the changes that the PBOC will ease monetary stimulus. In addition though, it could be that possible renewed tensions with the US over Taiwan is also spooking investors.
S&P 500 – finally a day with no new record high, but it looks like it is only a question of when this will happen again. Nonetheless, the FED could cause for a change in direction, depending on what they decide and mainly on what their outlook for the coming years is.
Commodities
Gold – was able to take a bit of advantage of the weakening USD and climbed a bit up from the lowest level since February this year. The direction of gold will fully depend on what the outlook will be for the US economy by the FOMC and also the forecast for the interest rate in the coming years.
Oil – dropped sharply as it was unable to continue to rally after the initial spike higher after non-OPEC members also agreed to cut production. The situation remains unclear and a lot of questions are still open and will only be answered in the coming months. The most important one will be if the countries that agreed to cut will really do so and also by the amounts they committed to. Judging by recent action and also looking at the past this remains very doubtful. Another big question mark is how fast and by how much US production will increase with the higher oil price. The EIA already foresees that shale production will be higher than forecast this month.
Stocks
Boeing (NYSE:BA) – has increased their dividend payments which was already expected, but the amount is higher than initially forecast and will be $1.42 per share. It also announced that of the $14 billion worth of shares it would buy back, it already completed $7 billion only this year. It has issued a new share buyback program worth again $14 billion, replacing the previous one. On the other hand, it foresees a slowdown in sales of its Boeing 777, which is the aircraft with the most profitability and will be cutting back production down from the current 7 to 5 a month in August 2017.
Exxon Mobil (NYSE:XOM) – its CEO, Rex Tillerson will be appointed Secretary of State in the new Trump Administration. While usually it is bad news for a CEO to leave a company as it brings about uncertainty, this case is different as there is hope that he will be able to improve the position for the company, especially since he has good ties with Russia.
Lockheed Martin (NYSE:LMT) – just as last week happened with Boeing, this time President-Elect Trump took aim at Lockheed Martin through Twitter. He tweeted that he thinks the cost (around $400 billion) of the F-35 (Join Fight Striker) program have run out of control. As a result Lockheed Martin traded over 2% down.