Charging Bull in Lower Manhattan New York. Image source: dbajurin © 123RF.com
The abysmal 2020 is finally over, and people look forward to the new year's promises ahead for a much-needed change in many regards. The global roll-out of the Pfizer/BioNTech and Oxford/AstraZeneca vaccines seems to go on track and looks poised to live up to the hopes of so many by becoming the game-changing tool in the fight against the coronavirus. Yet, many challenges of logistical nature remain.
Many market participants eagerly hope to see the world open up by the second part of the year, as more and more people are administered the jab worldwide. While most central banks remain wary of the prospects for swift global recovery, it is precisely such heightened market optimism that has been driving the most significant trends as of late.
Another concomitant factor leading to the current market trends has been the changing perceptions of traders and investors alike. Owing to the historically low yield rates in the U.S., and the exceptionally accommodative monetary policy stances of the world's top central banks, market opinions have become skewed. The markets for financial assets that entail high potential returns, albeit with higher associated risk, such as the market for Bitcoins, have been affected positively by the considerable slump in global demand for the greenback.
These trends were set in motion in 2020, and for the time being, appear to be accelerating over the first few days of the new year. However, it is worth considering the likely impact of market seasonality on these markets in the context of the current unprecedented situation.
The beginning of each new year is typically underpinned by bolstered optimism as professional traders and investors return to work after their end-of-year holidays. However, this time, the situation looks starkly different because even though the optimism is still there, the pandemic circumstances continue to affect the way people live and work. So, the impact of happy traders returning to their trading floors is likely to be negated this year, which would subsequently lessen the prospects for the development of new trends.
Nevertheless, all is not predetermined on the market. The consensus forecasts seem to project more woes for the U.S. dollar over the next few weeks, as traders expect to see more vaccine optimism in the near future. While such assertions could very well pan out to be accurate, this does not necessarily mean that the greenback will continue its unchecked freefall.
The next earnings season in the U.S. is due in just two weeks, and the biggest companies in the world are expected to deliver strong reports for Q4 of 2020. This is again owing to the fact that the extremely low-interest rates, coupled with heightened liquidity levels, would have made it quite possible for America's bluechip companies to have had another robust quarter.
Whenever the stock market advances, especially when such rallies result from solid quarterly performances, the greenback tends to strengthen. Such a turn of events could have a sizable spillover effect on other markets, which could result in the invalidation of all current market trends. Namely, a recuperating dollar could have far-reaching consequences for the Bitcoin, which has greatly benefited from the global scramble for high-yielding securities.
That is why the unique prospects resulting from the current unprecedented situation at the outset of 2021, seem poised to rattle the global capital markets in the near future.
Over the past few weeks, the USD has lost nearly 800 pips against the JPY, driven by Japan's shift away from decades of negative interest rates. With the Bank of Japan raising rates for the second time in a row, investors are adjusting their positions to [...]
Despite its volatility, Silver remains in an uptrend. While not as dynamic as Gold, XAG often mirrors XAU’s movements. A Multiple Top has formed around $32.50, and history shows that the more a level is tested, the weaker it becomes, increasing the likelihood of a [...]
A combination of factors, including Trump-era tariffs, the emergence of DeepSeek, and a slowdown in GDP growth, has contributed to the recent pullback in the US30 from its record highs. From a technical standpoint, a Double Top pattern has formed around the [...]
Over the past month, Silver has experienced an impressive 13% surge, marking a strong bullish trend. Despite notable volatility and multiple pullbacks, the overall momentum remains firmly to the upside. This strength is further validated by the Golden Cross, a historically reliable [...]
The Swiss Stock Market has been on a remarkable rally, surging over 15% between December and January. At times, the price action resembled a near-vertical ascent. However, following the announcement of Trump’s tariffs over the weekend, Monday’s trading session opened with a [...]
Between October and January, GBPUSD experienced a significant decline, dropping by approximately 1300 pips. However, we now observe signs of a potential trend reversal. Over the past few weeks, the pair has rebounded by more than 400 pips, shifting momentum toward a [...]
For the past 1 month, the UK100 saw a fantastic 600 point rally! The occasional corrections only attracted more buyers, which is healthy for the current up trend and the RSI currently exhibits elevated demand. A 130 point correction started last week on Friday, dipped below the [...]
Over the past two weeks, Japan’s leading stock index surged 2,000 points, reflecting strong bullish momentum. However, this week saw a sharp sell-off, erasing nearly all gains since mid-January. Despite this drop, the decline stalled at the 61.8% Fibonacci retracement, a key [...]
There is a clear shift in the momentum in the Oil market, with the commodity dropping with nearly 10% for the past 2 weeks. The Death Cross, a classic sell signal, is indicating that sellers are indeed in control and we are lookin now at a strong [...]
The 350 pip rally for the past 2 weeks seems like a trend reversal for EURUSD, with buyers back in control. The strong bullish momentum is also confirmed by the Golden Cross, a historic buy signal. Corrections are healthy for the trend and we currently looking at [...]
For the past 2 weeks GBPUSD went up with 400 pips and this is why we believe we might be looking at a trend reversal. The strong bullish momentum is confirmed by the Golden Cross, a classic buy signal, which supports the hypothesis that [...]
The Death Cross formation in USDJPY signals a robust downward momentum, with the USD depreciating by 300 pips over recent weeks. Further declines exceeding 300 pips are anticipated, potentially reaching the 152.00 level. Despite several corrective pullbacks, the price has been unable to surpass the [...]
Following the formation of a Double Top pattern at the 21,930 level last Friday, the NASDAQ has experienced a significant decline, plummeting by nearly 800 points. This downturn has been primarily driven by unfavorable manufacturing data emerging from China, alongside the Bank of Japan's interest rate hike on Friday. The market reaction closely resembles the [...]
GOLD's uptrend has regained strength, with several factors supporting further gains. The RSI bounced from oversold levels and now stands at 65, signaling growing demand and increasing buying volume. Additionally, the appearance of a [...]
For the past few months, USDJPY gained 2100 pips! Then, about 10 days ago the USD started dropping and so far corrected with 300 pips, dropping down to 155.00. A local Double Bottom got formed and this level also aligns with the important [...]
For the past week, the US100 has surged by over 1,000 points, signaling strong bullish momentum. The RSI stands at 69, indicating high demand and buyer dominance. A bullish Golden Cross pattern has emerged, confirming the upward trend. Despite a brief correction yesterday, with the index dipping to [...]
The Descending Triangle on the 4-hour chart, typically a bearish signal, failed to materialize this time. Instead, the Triple Bottom support at 92,000 held strong, driving significant buying volume. A Golden Cross—a classic bullish indicator—confirms strong [...]
After a 300-point correction from its December highs, the SP500 appears to be rebounding as bulls regain control. This recovery is supported by positive economic data, including strong NFP numbers, low unemployment, and CPI readings meeting expectations—all favorable for stocks. Additionally, the earnings season began yesterday with [...]
For several months, the EUR has been trending downward, losing hundreds of pips. While occasional corrections to the upside occur, bears remain in control. The strong downward momentum is highlighted by the Death Cross pattern, a classic sell signal. Yesterday, we observed another [...]
The Dollar remains strong, with buyers firmly in control since the Fed's December comments hinting at fewer 2025 rate cuts. This drove a 400-pip rally in USDCAD, now facing resistance near 1.4450 as early buyers take profit. Corrections are part of healthy trends, and the pair is testing support at [...]
