JPY takes a pause. Overview for 07.06.2024

The Japanese yen is stable against the US dollar on Friday. The current USDJPY exchange rate is 155.57.

Investors refrain from making significant decisions ahead of next week's BoJ meeting. The regulator is expected to maintain interest rates unchanged. The market is closely monitoring monthly bond purchases. A potential reduction in figures could signal a gradual tightening of monetary policy.

Bank of Japan Governor Kazuo Ueda confirmed this week that the central bank will gradually reduce its extensive balance sheet. The timing of such an undertaking remains uncertain.

In March 2024, the Bank of Japan phased out its negative interest rate policy, which had been in place for eight years. At the same time, it scrapped its yield curve control program as Japan set its sights on normalising monetary policy.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

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The RoboForex Team

GBP attempts to rise. Overview for 11.06.2024

The British pound sterling is trying to rise against the US dollar. The current GBPUSD exchange rate stands at 1.2736.

The pound has stabilised after hitting a new local low last week. The UK employment market data, industrial production, construction activity, and trade balance figures are due for release. The data are expected to confirm an economic slowdown in April.

The unemployment rate will likely remain at 4.30%, and average earnings are anticipated to increase by 5.70%.

At its next meeting on 20 June, the Bank of England will likely keep the interest rate unchanged at 5.25% per annum, its peak since 2008. UK inflation is clearly reducing, but not fast enough.

Additionally, there is some uncertainty about the country’s elections in early July, which may exert pressure on the pound.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

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EURUSD experienced significant volatility. Overview for 13.06.2024

The primary currency pair is looking for support after a turbulent rise on Thursday. The current EURUSD exchange rate stands at 1.0805.

Yesterday, the EURUSD pair faced a massive flow of data from both the US Federal Reserve and statistical reports. The Fed’s June meeting ended neutrally, with the interest rate remaining at 5.25% per annum, which was in line with expectations. However, the Federal Reserve’s comments, hinting at a rate cut this year closer to December, and the perceived aggressiveness of the Fed’s rhetoric regarding steps in 2025, have left the market in a state of anticipation for an active interest rate reduction.

The US Consumer Price Index dropped in May, exceeding forecasts. Inflation stood at 3.3% year-on-year, remaining flat on a month-to-month basis. Core inflation decreased to 3.4% year-on-year from the previous 3.6%. This development indicates the easing of price pressure, a positive signal for the economy and the Federal Reserve.

The market has become overly sensitive to statistical data releases. The US Federal Reserve created this foundation, having previously stated that it planned to gather as much data as possible to identify patterns.

Fundamental analysis for other instruments can be found in the section "Forex Forecasts and Analysis" on our website.

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Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

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The RoboForex Team

GBP continues to strengthen following a decline

The GBPUSD pair is strengthening its position following the release of the house price indices. It is likely to undergo a correction ahead of a further decline.

GBPUSD trading key points

• The UK’s Nationwide House Price Index (y/y) in June 2024 increased by 0.2%

• The UK’s Nationwide House Price Index (m/m) in June 2024 decreased by 0.2%

• The GBPUSD targets: 1.2600, 1.2500

GBPUSD fundamental analysis

The UK released its year-on-year and month-on-month house price indices for June 2024 on Monday, 1 July 2024. The figure increased slightly by 0.2% year-on-year and declined by 0.2% month-on-month, which did not prevent the pound from strengthening against the US dollar.

The consumer and mortgage lending figures will also be published today. However, given their low importance, the data will not significantly impact the GBPUSD rate.

US manufacturing PMI data is due during the second half of the European trading session. While the forecast suggests growth, the actual data release will confirm this, which may exert significant pressure on the GBPUSD rate.

Market analysis for other instruments can be found in the section "Market analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

EURUSD continues to strengthen in anticipation of speeches by the ECB and FOMC officials

The EURUSD pair is rising ahead of upcoming ECB and FOMC data. After the release of the FOMC minutes, another corrective wave may follow.

EURUSD trading key points

• The eurozone services PMI is projected at 52.6, lower than the previous 53.2

• A speech by ECB official Philip R. Lane

• A speech by FOMC member John C. Williams

• US nonfarm payrolls: prior reading of 152,000 and a forecast of 163,000

• US initial jobless claims: previous reading of 233,000 and a forecast of 234,000

• A speech by ECB President Christine Lagarde

• FOMC minutes release

EURUSD fundamental analysis

The EURUSD pair continues to strengthen on the news. The euro awaits speeches by ECB official Philip R. Lane, ECB President Christine Lagarde, and FOMC member John C. Williams, which may adjust the EURUSD rate and help strengthen the euro against the US dollar.

Nonfarm payrolls are projected to rise, and initial jobless claims are expected to increase as well. At this stage, it can be preliminarily concluded that these indicators will not significantly impact the EURUSD rate.

The FOMC minutes will be released at the end of the US trading session, potentially increasing volatility and temporarily supporting the EUR.

Market analysis for other instruments can be found in the section "Market analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

Gold (XAUUSD) is strengthening ahead of the nonfarm payrolls release

Gold price is steadily rising, with market participants focusing on today's US employment market data – nonfarm payrolls and the unemployment rate.

XAUUSD trading key points

• Current trend: gold is steadily rising after reaching a daily resistance level at 2,368 USD

• Market focus: today, market participants focus on US employment market data – nonfarm payrolls and the unemployment rate

• Price dynamics: XAUUSD quotes are consolidating slightly below the 2,368 USD level during the European trading session

Fundamental analysis

Nonfarm payrolls are expected to increase by 190,000, while the unemployment rate is projected to remain unchanged at 4%.

Following the release of US employment market statistics, volatility in XAUUSD quotes may surge. Depending on the upcoming data, they might continue their growth to new local highs or correct downwards following their previous rise.

Market analysis for other instruments can be found in the section "Market analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

USDCAD finds equilibrium, but the Canadian dollar remains strong

Investors in the USDCAD pair are assessing the latest statistics and forecasts. The Bank of Canada’s actions will determine further movements.

USDCAD trading key points

• The market is considering Canada’s employment market statistics

• The Bank of Canada may lower interest rates at every meeting until the end of 2024

• USDCAD price targets: 1.3696, 1.3600, 1.3530, and 1.3473

Fundamental analysis

The Canadian dollar has stabilised against the US dollar after strengthening markedly in July. The USDCAD pair is hovering around 1.3635.

Investors were prompted to react to last week’s Canadian employment market statistics release. The unemployment rate rose 6.4% from 6.2% in June, with the economy losing approximately 1,400 jobs. Although this is not the largest possible loss, signs of economic weakness are increasing.

The USD’s depreciation also contributed to the previous drop in the USDCAD pair. The slowing US economy is causing widespread concern, intensifying the focus on interest rates. The likelihood of a Bank of Canada interest rate cut at its July meeting is estimated at 60%. If this occurs, it will mark the second consecutive meeting with a rate cut, with markets anticipating a total reduction of 55 basis points by the end of the year.

If the Bank of Canada lowers interest rates again on 24 July, the market will likely interpret this as a signal for further cuts at each subsequent meeting unless unforeseen events happen.

Market analysis for other instruments can be found in the section "Market analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

USDJPY is rising amid uncertainty about the BoJ’s actions

The USDJPY rate closely approached weekly highs on Thursday, 11 July 2024. The current USDJPY exchange rate is 161.68.

USDJPY trading key points

• Uncertainty about the BoJ’s actions: traders awaiting a rate hike

• Japan’s machinery orders: unexpected decrease of 3.2% in May

• USDJPY price targets: 162.00 and 162.52

Fundamental analysis

Intrigue regarding the pace of monetary policy normalisation by the Bank of Japan remains. Markets anticipate that the BoJ may raise interest rates in late July in an attempt to curb the yen’s weakening. Analysts’ opinions vary, with some believing this will not be enough to halt USDJPY growth in the long term.

Japan’s Ministry of Finance officials reiterated their readiness for currency market interventions. Although they currently have a limited effect, they help to keep the yen weakening slowly and moderately.

Recent data showed an unexpected 3.2% (m/m) decline in Japan’s core machinery orders in May, indicating a potential economic slowdown. This is another signal favouring a further decline in the yen’s rate.

Market analysis for other instruments can be found in the section "Market analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

Elon Musk’s ambitious projects could elevate Tesla to a new level. Is it worth investing in its stock now?

Over the past 30 days, the yield on Tesla (NASDAQ: TSLA) shares has exceeded 48%. Elon Musk has grand plans for the company’s future.

Is it worth investing in Tesla stock now? What can prevent Musk from implementing his ambitious plans? Find out more in this article.

Tesla shares have experienced a prolonged decline since January 2024, with the price falling by more than 50% in four months. The price decline could be driven by Tesla’s refusal to pay compensation of approximately 55 billion USD to Elon Musk, who threatened to leave the company.

The situation changed radically on 13 June when the annual shareholder meeting approved this payment. Since that day, the stock price has significantly recovered, rising nearly 50% in just one month.

Tesla Inc revenue streams

Tesla Inc generates revenue through various sources reflecting the diversity of its products and services. The main ones are listed below:

1. Automotive sales – this includes direct sales to consumers and SPAM

2. Regulatory credits – selling regulatory credits to other car makers who need them to comply with environmental standards

3. Energy generation and storage – producing and selling solar energy systems and energy storage devices such as Powerwall (for domestic use), Powerpack (for commercial use), and Megapack (for large-scale energy storage)

4. Services and others – service and repair centres, the Supercharger network, and insurance services for Tesla electric vehicle owners

5. Software and autonomous driving – fees for advanced driver assistance systems (Autopilot), the full self-driving unit (FSD), and software updates

Tesla Inc Q1 2024 financial performance

Today is 15 July 2024, meaning that the second quarter of the year is over. However, Tesla will only release its Q2 report on 23 July, so we will now analyse Q1 2024 indicators. Below is the Q1 2024 financial performance data compared to Q1 2023.

Key data:

• Total revenues – 21.30 billion USD (a 9% decrease)

• Net profit – 1.10 billion USD (a 55% fall)

• Earnings per share – 0.34 USD (a 53% decrease)

• Operating margin – 5.5% (a fall of 592 basis points)

• Capital expenditures – 2.77 billion USD (a 34% increase)

Tesla Inc promising business areas

In January 2024, the Delaware (US) court invalidated a compensation package worth 55 billion USD payable to Elon Musk for his role as Tesla’s CEO. Musk criticised this decision and threatened to leave the company unless he received the compensation. He later changed Tesla’s registration from Delaware to Texas. At the annual shareholder meeting in June 2024, Musk’s compensation package issue was raised again and was approved. Although the real reasons behind this decision can only be speculated upon, it is evident that shareholders are placing another bet on Elon Musk, expecting the company’s further growth under his leadership.

Robotaxi

Tesla is actively developing a robotaxi service, where autonomous cars provide transportation services without involving drivers. In the future, Tesla electric car owners will be able to add their vehicles to the robotaxi network when not in personal use and earn money by renting them out as taxis. Consumers will be able to order Tesla robotaxis by using a mobile app similar to Uber and Lyft taxi services.

Market analysis for other instruments can be found in the section "Market analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

China’s sluggish domestic demand and economic slowdown jeopardise oil prices

Brent crude oil prices fall on Wednesday, 17 July 2024, declining for the fourth consecutive trading session.

Brent trading key points

• Declining demand in China: oil imports decreased to 46.45 million tons in June

• A slowdown in China’s GDP growth: GDP growth rates in Q2 fell to 4.7%

• Brent price targets: 85.90 and 87.72

Fundamental analysis

Recent data on China’s oil imports and GDP growth rates raised concerns in the global oil market. Oil imports to China, which is the world’s largest consumer of crude hydrocarbons, declined to 46.45 million tons in June, indicating sluggish domestic demand in the country. The slowdown in China’s GDP growth rates to 4.7% in Q2, below the 5.3% recorded in Q1, adds to pessimism.

The Chinese economy has traditionally been the driver of global economic activity and fuel demand. The weakening of these indicators could lead to oil oversupply in the market, which will negatively impact the prices. Although the Chinese authorities are taking action to stimulate the economy, it is not clear how quickly these measures will help revive fuel demand.

Market analysis for other instruments can be found in the section "Market analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

Brent prices fall, driven by a sell-off of risky assets

Brent crude oil prices are dropping again. The market has experienced sales growth amid falling prices for risky assets and the US dollar strengthening.

Brent trading key points

• Brent prices are falling due to pressure from the US dollar

• China’s plenum did not outline measures to support the economy

• Brent price targets: 85.00, 85.40, 86.90, and 88.00

Fundamental analysis

The commodity market was again under pressure, with a barrel of Brent crude oil falling to 84.73 USD on Friday.

Investors took a more cautious stance when assessing the global economic outlook, resulting in sales in stock and commodity market sales, which contributed to the growth of the US dollar. Statistics showing stronger-than-expected growth in July’s industrial production and increased jobless claims amid seasonality also bolstered the USD.

Commodity goods are generally believed to be less profitable to purchase amid USD growth.

Chinese news failed to support the oil sector. China’s third plenum ended yesterday without providing any guidelines on measures to revive the country’s economy. As China is the world’s largest oil consumer, positive signals from this side could support commodity prices.

Market analysis for other instruments can be found in the section "Market analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team

Positive expectations for the eurozone economy support EURUSD

The EURUSD rate slightly rose on Tuesday, 23 July 2024, trading above the key support level of 1.0875.

EURUSD trading key points

• The ECB’s decision to keep interest rates unchanged and Lagarde’s remarks about a “wide open” September meeting continue to support the euro

• Eurozone, Germany, and France PMIs are expected to improve, and consumer confidence in the eurozone is projected to peak

• EURUSD price targets: 1.0870, 1.0820, and 1.0777

Fundamental analysis

The European Central Bank’s decision to maintain the current monetary policy and Christine Lagarde’s statement that the upcoming verdict on 12 September remains open, continue to bolster the euro.

Eurozone, Germany, and France PMI data are expected to show a more substantial decline in manufacturing and further growth in the services sector. Additionally, the consumer confidence level in the eurozone is projected to reach its highest level since February 2022. The GfK consumer climate and Ifo business climate indicators are also expected to improve in Germany.

Investors believe that the Federal Reserve will lower interest rates in September and may do so twice by the end of the year amid slowing US inflation. US key economic indicators such as PMI, GDP, and the PCE price index are due this week and may heighten pressure on the US dollar if they are worse than forecasted.

Market analysis for other instruments can be found in the section "Market analysis" on our website.

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Sincerely,
The RoboForex Team