Master Select 5

There is a "death cross" on the daily chart of the US dollar. Let's see what analysts say.

A closely watched indicator of the U.S. dollar's performance against other major currencies showed a "death cross" on the daily chart on Friday (Jan. 12) - an ominous technical development that is often seen as a trend. Confirmation of negative changes.

The Intercontinental Exchange (ICE) U.S. Dollar Index DXY, which tracks the U.S. dollar against a basket of six major currencies, was trading around 102.16 in early U.S. trading on Friday, down 0.1% on the day, but has risen by about 0.8% since the beginning of the new year. The index fell sharply in December.

This price action brought the index's 50-day moving average close to or below its 200-day moving average near 103.40, triggering a death cross (see chart below).

While death crosses sound bearish, currency analysts question whether they provide much of a signal, preferring instead to confirm a downward trend that has already begun. The U.S. dollar index hit the so-called golden cross at the end of September last year, when the 50-day moving average rose above the 200-day moving average, which is considered a positive indicator.

Data going back to 1985 shows that death crosses do tend to see the index decline in the subsequent 1-month, 3-month and 6-month periods. The U.S. dollar index fell 1.2% over the next month, 1% over the next three months and 0.4% over the six months, according to Dow Jones Market Data. The probability of decline in 1 month and 3 months is 60%, and the probability of decline in 6 months is 52%.

Brad Bechtel, global head of foreign exchange at Jefferies, said in a note: "In my opinion, the death cross is generally a relatively meaningless indicator because I don't think its predictive power has any value, but you You may hear about it in the media."

Ipek Ozkardeskaya, senior analyst at Swissquote Bank, said in a note that the death cross is a lagging indicator and "does not necessarily mean that the dollar will not rebound." "

On the contrary . "I think the Fed's dovish expectations have been much ahead of schedule since late last year and the dollar has some room for a positive correction," she said.

The dollar fell sharply in December as investors expected the Federal Reserve to cut interest rates by about 25 basis points in 2024.

AUD/USD declines into near-term lows around 0.6680 despite Aussie Retail Sales beat

The Aussie lost ground on Tuesday, paring away intraday gains.
Broader markets are favoring the US Dollar heading into the midweek.
This week hinges on US CPI inflation figures due on Thursday.
The AUD/USD slid back into recent lows on Tuesday, paring back Wednesday’s limited bounce as the Australian Dollar (AUD) shrugged off an upside beat in Australian Retail Sales. The US Dollar (USD) saw broad-market uptake on the day as investors adjusted their risk profile heading into the midweek.

Australia’s Retail Sales and Building Permits both beat expectations
Australia’s Retail Sales in November climbed 2% MoM, well above the 1.2% forecast and rebounded from October’s -0.4% decline, which saw a downside revision from -0.2%. Australian Building Permits also beat forecasts, printing at 1.6% in November, well back from October’s 7.2% (revised down slightly from 7.5%) but still above the market’s -2.0% forecast.

Australian Building Permits likewise beat the street, showing 2% growth in November versus the forecast 1.2%. October’s Building Permits were revised slightly lower from 7.5% to 7.2%.

US Data was thin on Tuesday, and markets will be broadly turning focus towards Thursday’s US Consumer Price Index (CPI) inflation figures as investors look to draw a bead on future Federal Reserve (Fed) rate cuts. Last Friday’s Nonfarm Payrolls disappointed market participants hoping for a faster, deeper pace of rate cuts in 2024, as healthier jobs data makes it harder for the Fed to get pushed into a rate cut cycle.

AUD/USD Technical Outlook
The AUD/USD has settled back into familiar near-term lows near 0.6680 as intraday action gets capped underneath the 200-hour Simple Moving Average (SMA) near 0.6760. The Aussie is down 2.75% against the US Dollar from late December’s peak of 0.6871.

The AUD/USD’s near-term decline has the pair getting dragged back towards the 200-day SMA on daily candlesticks, approaching the 0.6600 handle as price action descends into a technical support zone following a bullish crossover of the 50-day and 200-day SMAs.

AUD/USD Hourly Chart

U.S. stocks close: Technology stocks ushered in the "opening hammer", and the Dow rose at the last moment to reach new highs

Financial News Agency, January 3 (Editor Shi Zhengcheng) On the first U.S. stock trading day in 2024, last year’s dazzling technology leaders collectively stalled, and the Nasdaq recorded its largest single-day decline since October last year . It's not all bad news today. With the strong medical concept and a surge in late trading, the Dow Jones Industrial Average turned red 3 minutes before closing, continuing to set a new closing high .

As of the close, the S&P 500 Index fell 0.57% to 4742.83 points; the Nasdaq Index fell 1.63% to 14765.94 points; the Dow Jones Industrial Index rose 0.07% to 37715.04 points.

(Dow Minute Minute Chart, Source: TradingView) It is not difficult to find from today’s market themes that the external market in 2024 will be a year closely surrounded by macroeconomic, geopolitical and political events. Approvals from various governments will also resonate with the capital market.

The weakness of technology stocks on Tuesday, especially the collective weakness of chip stocks, is related to the Dutch government's partial revocation of ASML's export license for China's NXT:2050i and NXT:2100i lithography machines. A similar emotional decline also occurred last year. Pass. In the U.S. stock market on Tuesday, Arm fell by more than 8%, the largest single-day decline since its IPO. Industry chain concept stocks such as AMD, ASML, Intel, and Applied Materials fell by nearly 5%.

Another market thread is also related to geopolitics. As the Red Sea crisis intensified last weekend, Maersk once again announced the suspension of the Red Sea route on Tuesday . As France's CMA CGM announced a significant increase in freight rates on the Asia-Mediterranean route, Maersk's US stock closed up 7% on Tuesday.

The final hot spot is also related to the expectation of government (FDA) approval. As the only stock in the S&P 500 Index that rose more than 10% on Tuesday, Moderna's "dilemma reversal" logic has attracted attention . Analysts pointed out that in addition to the new crown vaccine, Moderna's RSV vaccine is expected to be launched within the year, and influenza and customized cancer vaccines will also be launched within one to two years.

Under the leadership of Moderna, pharmaceutical and health care concept stocks such as Pfizer, Merck, Amgen, and UnitedHealth have collectively strengthened, which is also the main driving force for the Dow to reach new highs.

Popular stock performance

The seven technology giants known as the "Magnificent 7" collectively fell, with Apple falling 3.58%, Microsoft falling 1.37%, Amazon falling 1.32%, META falling 2.17%, Google-A falling 1.09%, Tesla falling 0.02%, and NVIDIA fell 2.73%.

Chinese concept stocks also performed poorly, with the Nasdaq China Golden Dragon Index falling 3.5%. Alibaba fell 3.57%, Baidu fell 3.15%, Pinduoduo fell 0.46%, JD.com fell 5.85%, NetEase fell 0.74%, Weilai fell 7.17%, Li Auto fell 7.59%, and Xpeng Motors fell 3.77%.

Other news

[Although Tesla’s Q4 sales exceeded expectations, the market is more concerned about “being surpassed by BYD”]

As usual, Tesla announced its vehicle production and delivery data for the fourth quarter of last year on January 2. Tesla delivered 484,500 vehicles in Q4, exceeding market expectations, and the total delivery volume for the year reached 1.8086 million. In terms of production data, Tesla produced 495,000 vehicles in Q4, and the total annual output was 1.846 million vehicles.

Data released by BYD on Monday showed that its pure electric vehicle sales in the fourth quarter of 2023 were 526,400 vehicles. Although the annual pure electric vehicle sales of 1.5748 million units are still slightly lower, according to this trend, the global pure electric vehicle sales ranking will be reversed in 2024.

[Apple gapped and fell on the first day of the new year]

On the first trading day of the new year, Apple, the "stock king" of the US stock market, jumped out of a rather obvious gap. Although the decline itself was only 3.6%, this start also gave investors who were bullish on the "Big Seven" a blow. On the news, Barclays became the latest investment bank to downgrade Apple stock. Analysts from the bank pointed out that the performance of the new iPhone 15 was mediocre, with sales and configurations falling short of expectations, and the same is expected for the iPhone 16, without any more attractive features or upgrades.

The analysis pointed out that although most Wall Street analysts are still bullish on Apple, sporadic and slowly increasing bearish voices have attracted more attention. Although there are rumors that Apple may officially put Vision Pro on the shelves at the end of January or early February, the high pricing of this product itself is destined to be unable to boost the performance of the leading US stock market in the short term.

[AI concept stock Palantir announced that it will hold the first board meeting of the New Year in Israel]

Palantir, a developer of U.S. stock intelligence analysis software and an AI concept stock that investment banks are quite optimistic about, announced on Tuesday that the company will hold its first New Year's board meeting in Tel Aviv next week, emphasizing that the company's work in the region has never been more important. This news did not stop Palantir from falling, with the company closing down 3.44% on Tuesday.

[Waiting for SEC approval of Bitcoin concept stocks, huge shock in the market]

Due to the news two days ago that "the U.S. SEC may issue the first batch of Bitcoin spot ETF approval documents on Tuesday or Wednesday," Bitcoin itself continued to rise to around $45,000 on Tuesday, hitting a new high in the past two years. However, the trends of Bitcoin concept stocks are quite different. MicroStrategy, which holds a large number of Bitcoins, closed up more than 8% on Tuesday. Coinbase, which is planning to provide spot Bitcoin custody services, fell 9.8%, while small-market concept stocks such as Marathon Digital fell by 9.8%. After opening with an increase of more than 10%, it ended up falling by more than 2%.