#USDMXN and #NASDAQ100 Monthly Forecast: March 2024

USD/MXN Monthly Forecast: March 2024

Sideways trend observed with potential 'double bottom' formation. Key support at 16.80 MXN, focus on Fed rate cuts.

• The US dollar has gone sideways against the Mexican peso during the bulk of the month of February, and therefore I think we need to pay close attention to this pair because it could be trying to give us a little bit of a “heads up” as to what it does next.
• When you look at the longer-term chart, the area just below is a major support area, and I think that comes into the picture as to whether or not we bounce or not.

Just underneath, we have the 16.80 MXN level, an area that has been very important, and therefore I think we will continue to test that and probe that for signs of support. That being said, we are also in the potential beginning phase of forming a massive “double bottom” on the weekly chart, which would be interesting considering that the Federal Reserve is expected to cut interest rates this year. If that’s the case, the idea is that most traders would prefer to own the Mexican peso, because the Bank of Mexico offer such a high interest rate payment. However, if we bounce from here in the Federal Reserve continues to look like they are going to cut, this could be a sign of something ominous.

While a lot of you may not necessarily trade this pair from a longer-term perspective, it is worth watching because it gives you an idea as to how the US economy may be performing. Paradoxically, the worse the US economy performs, the better the US dollar will do here due to the fact that a lot of people will be throwing money into safety assets such as US Treasuries instead of emerging market currencies like the Mexican peso.

The outlook

I’m not going to lie here, this is going to be a difficult pair to trade for the month of March, mainly because it is a thinly traded pair, and of course is traded during specific times of the day more than others as it has a lot to do with cross-border payments. Simply put, I will often use this pair as a gauge on what to do with not only the US dollar, but sometimes the US stock market. That being said, if we were to break down below the 16.80 MXN level, that would be a horrific sign for the US dollar, meaning that it will probably be losing strength against almost everything.

NASDAQ 100 Monthly Forecast: March 2024

The NASDAQ 100 has been resilient in February, with 16,950 as key support. Despite possible pullbacks, the uptrend persists, led by the "Magnificent 7". The outlook for March is primarily bullish, with sideways movements possible.

• The NASDAQ 100 has been very resilient during the month of February, as we continue to see a lot of upward pressure.
• Underneath, the market is likely to continue to see the 16,950 level as a major support level, I think that anytime we get close to that area, there should be plenty of buyers.
• The 20-Week EMA is testing that area right now, so I think that comes into the picture to perhaps send the NASDAQ 100 higher.

That being said, it’s very unlikely that the NASDAQ 100 is extraordinarily negative during the month of March, and I do think that it is probably only a matter of time before buyers come in and pick up bits of value every time you post back. Whether or not we are going to continue to see upward pressure is neither here nor there, because quite frankly it’s all about a handful of stocks. As long as we continue to see the “Magnificent 7” perform well, it’s likely that the NASDAQ 100 will continue to go higher. However, if they “Shoot the generals”, meaning that they take those 7 stocks down, the NASDAQ 100 will fall apart.

We are in an uptrend, and therefore it’s likely that you need to look at it through that prism. I don’t have any interest in trying to get too cute and shorting this market, despite the fact that a 10% drop would be about the best thing that could happen to keep the uptrend healthy. That being said, as long as we continue to have this mania in place, it makes quite a bit of sense that we either follow right along or sit on the sidelines.

NASDAQ 100 Outlook March 2024

The outlook for this market is rather straightforward and simple: it’s obvious that the NASDAQ 100 is very bullish, and I think that the month of March will more likely than not continue this. At the very least, I would anticipate that we continue to see a lot of sideways movement more than anything else, or perhaps an occasional pullback that we could take advantage of. In fact, I don’t have a situation where we start shorting unless of course we break down below the 50-Week EMA, which is closer to the 15,500 level, and even then I would have to see what was going on with the idea of interest rates. It remains bullish, and I just don’t see that changing.

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#NASDAQ100 & #SP500 Forecast: August 2022

 

S&P 500 Forecast: August 2022

I think fading rallies will more likely than not the way going forward.

• The S&P 500 rallied a bit heading into the month of August, as we have pierced the 4000 level.
• This is a bullish sign but at this point, it’s probably a bit much to assume that we are going to turn around. In fact, the market has been in a relatively stable channel for the last several months and has not broken out above it.
• It is probably only a matter of time before we see sellers come back into this market.
• This is a situation where the market probably got overdone to the downside, and I think what you are looking at is a situation where signs of exhaustion will occur.

Watching the Fed

Once we get the signs of exhaustion in this chart, then I believe that the sellers will push this market back down to the lows. While the Federal Reserve raised interest rates by 75 basis points on the 27th, the reality is that the market is starting to look at the idea that perhaps the Fed is closer to slowing down hikes than raising them. The market tried to get ahead of the Federal Reserve, but ultimately, I think this is a scenario where we still have plenty of concerns on there and judging from what Jerome Powell had to say during the day, the Federal Reserve will more likely than not be highly sensitive to inflation numbers coming out over the next several weeks. As that is the case, this market will literally go up or down with inflationary figures.

Personally, the market is probably going to go back into the “bad is good” phase again. If economic numbers continue to slow down in the United States, the idea is that the Federal Reserve will be paying close attention to the idea of inflation dropping. If economic numbers are getting worse, the idea is that inflation will eventually stall. In other words, they will try to “front run” the Fed. This will make volatility worse, not better. Nonetheless, it’s not until we break above the 4200 level that I would be looking at this as a longer-term uptrend just waiting to happen. Because of this, I think fading rallies will more likely than not the way going forward.

NASDAQ 100 Forecast: August 2022

Pay close attention to the US dollar, because it should have a relatively high negative correlation.

• The NASDAQ 100 tried to recover toward the end of the month in July, as we are very volatile, to say the least.
• This is a market that will be paying close attention to interest rate variables, which of course would be inflation in general.
• When you look at this chart, it’s easy to see that the 12,000 level was important, and therefore traders may pay close attention to that for “market memory.”

The 12,000 Level

Furthermore, you should pay close attention to the 12,000 level as a potential “fair value point” as it is the middle of the overall consolidation that we have been in recently. Because of this, if we can break above the 13,000 level, then it’s likely that we could go looking as high as 14,000. The 14,000 also features the 50-week EMA. On the other hand, if the markets were to break down through the 200 Week EMA, that would be an extraordinarily negative sign.

I think at this point, the market is trying to figure out whether or not the Federal Reserve is going to lift it or not, which unfortunately may be quite data-dependent. In other words, we are just as confused as we were previously. Nonetheless, the market is looking very likely to turn things around and perhaps try to give a short-term relief rally. That being said whether or not we have the staying power is a completely different question altogether.

Pay close attention to the US dollar, because it should have a relatively high negative correlation, and therefore are paying close attention to anything that happens as far as the currency markets are concerned. The 200 Week EMA underneath is a major influence on this market, so if we were to break down below it, look out below. At that point, I would anticipate that we would probably threaten the 10,000 level. 10,000 obviously will have a major psychological impact on the market, so giving that up would be rather nasty. In that scenario, we could drop rather significantly. On the other hand, if we were to break above the 14,000 level, that would be a very positive turn of events for the NASDAQ, which of course is going to be very sensitive to dangerous rates as so many of the major players are “big tech.”

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#INDICES ANALYSIS: #DAX30,#SP500,#DOWJONES,#NASDAQ (09 JUNE 2022)

S&P 500 Forecast: Consolidation Ahead of CPI

For the Thursday session, you might be better off sitting on the sidelines.

The S&P 500 fell a bit on Wednesday as the 50-day EMA has offered a bit of resistance. At this point, I think the market is more or less waiting for the CPI figures coming out on Friday to determine where we go next. The world is waiting to see what the Federal Reserve is going to do, and the CPI numbers for the month of May could be yet another piece of the inflationary puzzle that traders will pay close attention to.

For the Thursday session, you might be better off sitting on the sidelines, but if you are a short term trader, you may look at this as a nice range bound situation that you can trade on short-term charts, because that’s all you’re going to get unless something significant happens in the next 24 hours. For those who are a bit more along the lines of a swing trader like I am, this doesn’t offer much in the way of interest.

Dow Jones Technical Analysis: Declining Due to Resistance

Our expectations indicate more decline for the index during its upcoming trading.

The Dow Jones Industrial Average declined during its recent trading at the intraday levels, to record losses in its last sessions, by -0.81%, to lose the index by -269.24 points. It settled at the end of trading at the level of 32,910.91, after rising by 0.80% during Tuesday's trading.

Technically, the index’s decline came as a result of the stability of the important resistance level 33,271.90. This is resistance that we had referred to in our previous reports, in light of the dominance of the corrective bearish trend in the short term. It is trading within the range of a bearish price channel, as shown in the attached chart for a (daily) period. We note that divergence is negative with the relative strength indicators, after reaching the areas of severe overbought. This is in an exaggerated manner compared to the movement of the index, with the start of the influx of negative signals from them. There is continuing negative pressure of its trading below the simple moving average for the previous 50 days.

Therefore, our expectations indicate more decline for the index during its upcoming trading, as long as the resistance 33,271.90 remains intact, to target the main support level 32,000.

DAX Forecast: Index Pulls Back from Crucial 200-Day EMA

In the short term, I think €13,500 would probably be a major accomplishment by the short-sellers.

The DAX fell rather hard on Thursday as we continue to see a lot of negativity. Stock markets around the world are trying to figure out whether or not inflation, and central bank policy, will continue to work against stocks. It’s kind of interesting to see how this is running concurrently around the world. The German index obviously is not going to be immune to global issues, especially as so many of the major constituents of the DAX are massive exporters.

I think it’s much more likely that we break to the downside, but in the short term it looks like we are more likely than not willing to hang around and chop back and forth. Because of this, if you are a short-term trader you will more than likely continue to look at these two moving averages as barriers. Once we do break out of this area, it would make sense that we could go down to one of the blue circles that I have on the chart. I think that is the most likely scenario but I would also point out that there has been a significant amount of momentum, so I think what we will probably see is an attempt to get down to one of those. Whether or not we break to a fresh, new low is a completely different question, but in the short term, I think €13,500 would probably be a major accomplishment by the short-sellers.

NASDAQ 100 Forecast: Consolidating Below 13,000

I still look for signs of exhaustion to sell into at this point.

The NASDAQ 100 initially rallied on Wednesday but gave bank gains to show signs of weakness again. That being said, we are in a consolidation area that is well defined and will probably hold until we get the CPI figures on Friday. After all, the world is paying close attention to inflation in the United States and what the Federal Reserve will do as a reaction.

Pay attention to the bond market, because if the interest rate suddenly collapses, then it’s likely that we could see a significant amount of relief in the NASDAQ 100. After all, the market is likely to continue seeing the usual influence of rates on technology stocks. If rates fall, then it’s likely that we will see a lot of bullish pressure in this market, but keep in mind that the exact opposite can happen. Because of this, it is very important to keep the idea of correlation in mind. If we break down below the 4400 level, then it’s likely that we can look into the 12,000 level again, and then possibly the 11,500 level after that. Anything below that level will continue the overall negative attitude in this market.

Without some help from the Fed, I just don’t see how the NASDAQ 100 suddenly picks up. I do think that eventually, we could get a nice opportunity, but we are nowhere near it right now, so I still look for signs of exhaustion to sell into at this point. Inflation lis ikely to continue roaring, so that could be something worth paying attention to.

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#Equity and Risk FX Bulls Take Control ahead of US Payrolls (03 JUNE 2022)

 After offering a dour view of the world yesterday we’ve seen markets do the complete opposite, with the risk bulls dominating – the news flow certainly doesn’t justify this positivity, especially in light of JPM’s CEO Jamie Dimon’s comments that we could be facing a hurricane, “down the road, coming our way.”

We also a 5% bullish reversal in Microsoft after trading down to $261.60 at the open, before the buyers stepped in all through US trade – the market reacting to revised earnings guidance, the tech giant saying that the strong USD would become more of a headwind – if ever you needed proof that the USD is central to the equity story, this is it. In fact, any basic regression would show Asian equity markets are even more negatively affected by a strong USD.

We also heard from Fed vice-chair Lael Brainard who detailed “If we don’t see the kind of deceleration in monthly inflation prints, if we don’t see some of that really hot demand starting to cool a little bit, then it might well be appropriate to have another meeting where we proceed at the same pace (I.e 50bps)”…I’m not sure this is a huge shock to the markets, who had already priced this into rates markets anyhow, so maybe the rally in risk (equity and credit) is part down to the fact interest rate markets are already pricing in aggressive hikes.

I also think we must come back to our friend flow – when something can’t easily be explained – such as today’s rally in risk – then sometimes we just have to consider there are bigger forces out there…such as positioning, hedging flows and volatility targeting fund flows. It feels to me that a decent part of the leveraged institutional world is caught offside on their equity position and managing it accordingly – volumes through the S&P500 cash market were poor though – some 22% below the 30-day average – and we saw 1.47m S&P500 futures traded, 20% below the 20-day average. Obviously, you still make or lose money in low volume markets.

A break of 4200 in US500 would be the pain trade and likely see further short covering, but the talk on the street is we need to push above 4270 to see the systematic trend-following funds really cover shorts more aggressively.

(NAS100 daily)

The NAS100 is looking even more bullish, with price printing a bullish outside day reversal and now sits above its 30 May swing and the short-term trend indicators favouring longs here. We’re pushing a congestion area in the NAS100, so a breakoff of 13k would be very constructive indeed.

We can see in FX markets that the USD has been shunned, largely because of the equity move. All of Wednesday’s gains have been erased in the USDX and we see high beta FX working nicely, notably vs the JPY. We’ll have to see if today’s US payrolls change things, and I would be looking squarely at the unemployment rate (consensus 3.5%) and average hourly earnings component – this is the inflationary aspect, and the market expects wage growth of 5.2%.

CADJPY has been a pillar of strength but it’s the AUD that is now firmly on the radar – I like it higher vs the EUR and GBP here, with EURAUD and GBPAUD breaking down – it feels like we could get a bit more upside in EURAUD but rallies look like they will be sold and if the equity flow can continue – a big if – but in this vein, EURAUD should be headed for 1.4600.

(AUDUSD daily chart)

AUDUSD gets the lion’s share of attention from clients (and the broader market) and we currently eye a bullish daily reversal and a test of the May swing of 0.7266 – one for the breakout players.

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#US #Dollar Index Crawls Back ahead of #Fed Minutes (25 MAY 2022)

 US stocks erased some of the gains made on Monday as investors continue worrying about corporate earnings. Social media shares like Snap and Pinterest crashed by more than 20% after Snap warned about trends in the ad business. Advertising companies like Trade Desk, Digital Turnbine, and Omnicon declined sharply. Similarly, Abercrombie & Fitch declined sharply as investors worried about its weak earnings. The next key corporate earnings to watch today will be Nvidia, Snowflake, and Box will publish their results later today.

The US dollar rose slightly after the hawkish statement by Jerome Powell. Like he did last week, the Fed chair warned that the bank will continue hiking interest rates in the coming months. It also rose even after the relatively weak new home sales numbers. The numbers showed that new home sales declined by 16.6% in April. They dropped from 709k to 591k, which was lower than the median estimate of 750k. This trend happened as mortgage rates kept rising. Further data showed that the country’s manufacturing PMI declined from 59.2 to 57.2. The next key mover will be the minutes by the Federal Reserve.

The New Zealand dollar rose slightly on Wednesday morning after the latest interest rate decision by the country’s central bank. It decided to hike interest rates by 0.50% to 2% in its bid to fight inflation. It also signaled that it would continue hiking interest rates in the coming months. This view is in line with what other central banks like the Fed and the Bank of England are doing. The next key economic numbers to watch will be the German and Mexico GDP data. Also, the US will publish the latest core durable goods orders and crude oil inventories.

EURUSD

The EURUSD pair has been in a strong bullish trend in the past few days. The pair managed to move above the important resistance at 1.0646, which was the highest level on May 5th. It is being supported by the 25-day and 50-day moving averages. At the same time, the Relative Strength Index (RSI) and the Stochastic Oscillator have kept rising. Therefore, the pair will likely keep rising as bulls target the key resistance level at 1.0800.

EURCHF

The EURCHF pair has been moving up gradually in the past few days. It is trading at 1.0311, which is slightly above the key support level at 1.0250. A closer look shows that the pair has formed a bearish flag pattern, which is usually a bearish signal. The Relative Strength Index has moved slightly below the neutral point at 50 while the Stochastic Oscillator has moved downwards. The pair will likely have a bearish breakout soon.

NAS100

The Nasdaq 100 index came under intense pressure as investors focused on the weak guidance by Snap. The index is trading at $11,750, which is slightly above the year-to-date low. On the four-hour chart, the index is between the descending channel shown in blue. The Relative Strength Index has moved to the neutral level at 50. The index will likely keep falling as bears target the key support level at $11,200.

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#NASDAQ100, #SP500 AND #WTI #CrudeOil Forecast: May 2022

 NASDAQ 100 Forecast: May 2022

In the bullish scenario for the month, I suspect that we continue to trade in the overall consolidation area that I see at the moment.

The NASDAQ 100 has had a very rough month in April, as traders are starting to focus on the fact that the Federal Reserve is not willing to step in and save Wall Street on every dip now. Inflation continues to be a major concern, and therefore the month of May might be a rather difficult trading. At the very least, I anticipate seeing a lot of volatility, and do not expect to see that go away anytime soon. In this scenario, I believe that we are going to continue to struggle for clarity.

If we break down below the 12,500 level, then it is likely that the NASDAQ 100 will go looking to the 12,000 area underneath. The 200 Week EMA sits at the 11,334 level and is climbing, so that could also be a potential target for short-sellers. I would also anticipate that there might be a certain amount of buying pressure in that general vicinity as well unless of course, we get a complete meltdown.

The more bullish scenario that I see is that economic numbers continue to slump as the GDP number has in the United States, suggesting that perhaps the Federal Reserve will be able to tighten as much as once thought. I do not think that is going to happen, because quite frankly the most important figure will be inflation. As long as inflation numbers are hot, the Federal Reserve is going to tighten and therefore dampen profits in the stock market.

If we get some sign of a shift in attitude, that might be enough to get the market bullish, at least to reach the 15,000 level above. In the bullish scenario for the month, I suspect that we continue to trade in the overall consolidation area that I see at the moment. This is probably the best-case scenario unless, of course, the Federal Reserve comes out and completely changes its attitude. That seems to be very unlikely at this point, so keep that in the back of your mind. Ultimately, I do think that the Federal Reserve is serious about driving down asset prices, and the most obvious place that they would do so would be the stock market. Keep in mind that a lot of these high-flying technology stocks desperately need low-interest rates to continue rising the way they had over the last several years.

S&P 500 Forecast: May 2022

Expect that any rally up to the 4500 level will be looked at with a significant amount of suspicion unless of course something fundamentally changes.

The S&P 500 has had a very rough month of April, as have all stock markets around the world. The market is currently threatening the 4200 level, which is an area that will attract a certain amount of attention. That being said, the question is going to be whether or not that area is going to continue to offer support, or if it is going to simply be broken through?

If we break through the recent lows, the 4000 level would be the most logical of targets going forward. I do not necessarily think that this is a scenario where it is going to be easy to short this market, but it is obvious to me that going “all in” into the S&P 500 is going to be reckless in this current environment. With the uncertainty out there, it is difficult to get overly excited about owning stocks, and it should be noted that a lot of institutional money is starting to get underwater at this point. I do think that sooner or later we are going to see some massive forced liquidations, but we do not necessarily know when that could happen. In this scenario, we could see a massive selloff happen in a very short amount of time.

The main question now is how much the tightening the Federal Reserve is going to do, because quite frankly there are plenty of people on Wall Street that still do not believe that the Fed will raise interest rates five or six times, let alone the 13 times that have recently been priced into Fed futures market. This is because an entire generation of traders have no idea what it is like to trade against the Fed, which is essentially what happens when they are raising rates. With that in mind, expect that any rally up to the 4500 level will be looked at with a significant amount of suspicion unless of course something fundamentally changes. Earnings have been okay, but not necessarily stellar. Furthermore, the GDP number that came out on 28 April was much weaker than anticipated. This adds a new layer of indigestion to the market. The 50 Week EMA is right in the middle of the current trading range, so the best-case scenario is probably a back and forth month.

WTI Crude Oil Forecast: May 2022

WTI Crude Oil Forecast: May 2022

I do have more of an upward bias, but I also recognize that things can change in a flash.

The West Texas Intermediate Crude Oil market has been very tight during the month of April, and it now looks as if we are trying to build up enough momentum to make a bigger move. It is worth noting that the uptrend line of the triangle is still very much intact, so you should pay close attention to it. It is as if the market is trying to determine whether or not the demand is going to overwhelm supply or vice versa. After all, there are a lot of moving pieces when it comes to the global economy at the moment.

It is worth noting that we are just above the $100 level, and that of course has a certain amount of psychology attached to it. As long as we can stay above the $100 level and that uptrend line that I have plotted on this chart, then it is difficult to imagine shorting this market. If the market takes out the $110 level, it is very likely that we will have a significant amount of momentum building up for the buyers, and therefore could allow the market to go looking towards the recent highs, which is closer to the $130 level.

However, if we start to see the global economy slow down enough to cause demand concerns, then it is possible that we could break down below the uptrend line. If we do, then it opens up a move down to the $90 level, possibly even down to the 50 Week EMA which is currently at the $83 level. This would more likely than not be based upon the idea of the global economy falling apart, which obviously is something that is a major concern now that China continues to lock things down. However, it is probably worth noting how strong the market has been behaving in the face of half of China being shut-in.

With all this being said, I do have more of an upward bias, but I also recognize that things can change in a flash. Because of this, I will continue to use the triangle as a guideline as to where we go next, understanding that volatility is probably the only thing that we are going to see on a constant basis, so position sizing and stop loss placement will be crucial.

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#DowJones and #Nasdaq100 volatility continues (26 April 2022)

 US equities bounced back on Monday as investors reacted to the deal between Twitter and Elon Musk. In a statement, Twitter said that it had reached a deal to sell itself for $44 billion. The Dow Jones rose by 238 points while Nasdaq 100 rose by 165 points ahead of the upcoming big tech earnings. Investors are concerned about the slowing economy as China locks down major cities like Shanghai and as the war in Ukraine continued. Some of the top movers were companies like Moderna, Match Group, and Alphabet. Coca-Cola shares rose after the company announced spectacular results. On the other hand, companies like Schlumberger, Haliburton, and Deere declined by more than 8%.

The US dollar index held steady as the CBOE volatility index rose. The index rose above $101.75, which was the highest level since 2020. The currency will react to the latest durable goods order, consumer confidence, and new home sales numbers. Economists expect the data to show that consumer confidence rose from 107.2 in March to 108.0 even as inflation continued. Further, they expect that new home sales reduced from 772k to 765k. Other numbers are expected to show that durable goods orders rose to 1.0% after falling by 2.1% in February.

Gold crashed to the lowest level since March 25th as the commodity sell-off continued. It declined sharply even as bond yields also crashed hard. For example, the 10-year yield declined to 2.78%, which was lower than this year’s high of 2.98%. Similarly, the 30-year yield dropped to 2.87% while the 2-year fell to 2.57%. In addition to gold, other commodity prices also declined sharply. For example, silver crashed to $23 while Brent and West Texas Intermediate (WTI) fell to $100 and $96.30, respectively.

XAGUSD

The XAGUSD pair crashed hard as commodity prices declined. It fell to a low of 23.40, which was the lowest level since February 18. On the four-hour chart, the pair moved below the important support level at 23.93. It also moved below the 25-day and 50-day moving averages. The DeMarker indicator moved below the oversold level. The price is also along the lower side of the Bollinger Bands. Therefore, the pair will likely have a relief rally soon.

XAUUSD

The XAUUSD pair crashed to a low of 1,889, which was last at the lowest level on March 29. On the four-hour chart, the pair managed to move below the 25-day moving average while the momentum indicator has been falling. The commodity channel index has also moved below the oversold territory. Like silver, there is a possibility that the pair will likely rebound in the near term.

EURUSD

The EURUSD pair continued its bearish trend in the past few days. The pair crashed to the lowest level since 2020 as volatility rose. It has moved below the 25-day and 50-day moving averages. Also, the Relative Strength Index (RSI) is approaching the oversold level on the 4H chart. The Stochastic oscillator is hovering near the oversold level. Therefore, the pair will likely have a relief rally today.

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#Euro Retreats as Emmanuel Macron Beats Le Pen in #France (25 April 2022)

American equities dropped sharply on Friday as concerns about the Federal Reserve escalated. The Dow Jones and S&P 500 indices had one of the worst days this year after Jerome Powell warned that the bank will continue its aggressive rate hike policy. This will involve more rate hikes and even quantitative tightening. Investors are also worried about margin pressure as the ongoing earnings season continued. Data compiled by FactSet showed that 20% of all companies have published. Of these firms, 79% have reported a positive EPS surprise while 69% have published a positive revenue surprise. The 12-month forward PE ratio of the S&P 500 has moved to 18.6.

The British pound retreated to the lowest level since 2020 over concerns about the next actions of the Bank of England. Investors believe that the BOE will pause its rate hikes and embrace a more dovish tone considering that the economy is slowing. This was evidenced by the fact that consumer confidence has crashed to the lowest level since 2008. According to Gfk, confidence crashed minus 7 points to -38 in April as concerns about inflation rose. Further data showed that revealed that retail sales crashed hard in March.

The euro declined on Monday morning as investors focused on the outcome of the French election. Results between Marine Le Pen and Emmanuel Macron showed that the incumbent took a strong lead. He won 58% of the total vote even as voter turnout remained weak. He also becomes the first French president to be reelected in 20 years. Therefore, this means fears of France being led by a far-right leader. As a result, analysts expect that status quo in Europe will continue. The key data to watch will be the latest German current assessment and business climate data. Their impact on the euro will be relatively minimal.

NAS100

The Nasdaq 100 index declined sharply over concerns about rising interest rates. It dropped to a low of $13,318, which was the lowest level since March 21st. It has moved to the lower side of the Bollinger Bands and below the 23.6% Fibonacci retracement level. It has also moved below the 23.6% Fibonacci retracement level and while the Relative Strength Index (RSI) has pointed downwards. Therefore, the index will likely keep falling in the near term.

GBPUSD

The GBPUSD pair continued the bearish trend after the weak economic data from the UK. The pair is trading at 1.2831, which is significantly lower than the key resistance at 1.300. On the four-hour chart, it moved below the descending triangle pattern. It has also moved below the 25-day and 50-day moving averages while the Stochastic oscillator and the momentum have pointed lower. The pair will likely have a relief rally today.

EURUSD

The EURUSD pair remained under pressure as investors reflected on the French election. It is trading at 1.0796, which is between the middle and lower lines of the Bollinger Bands while the Stochastic oscillator has moved above the oversold level. The pair is also below the 25-day moving average. The pair will likely remain in this range today.

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