Daily review for January 06, 2022
The Fed announced faster and more aggressive interest rate hikes. Equities fall sharply globally. Investors begin to allocate capital to fixed income.
Metals also fall sharply. Traders sell silver and buy WTI. They also buy German and US bonds.
Cryptos also show significant declines. Bitcoin trades at USD$42,800. Ethereum loses 10%.
Commodities in the energy segment present falls not as significant as other segments. Energy demand in Europe continues to increase.
| EUROSTOXX 50 -1.20% |
| Jerome Powell as Chairman of the FED announced that the interest rate hike would be higher and faster than expected by the market. Following the announcement, stock indices and equities globally started to correct. At the moment the Eurostoxx 50 is down 1.20% and is trading at 4,325 points. Investors have started massive sell-offs in every asset class. They have also started buying bonds. The German 10-year bond is up 29.41%. The 10-year Treasury bond is up 1.89% and the 30-year Treasury bond is up 1.38%. |
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| Support 1: 4,296 Support 2: 4,281 Support 3: 4,266 Resistance 1: 4,326 Resistance 2: 4,341 Resistance 3: 4,356 Pivot Point: 4,311 |
| The price descended from resistance 2 to support 1, the level where it is currently at. Possible bounce of a few points from this area. Ichmoku cloud projects trading range between 4,266 and 4,356. Pivot point for trend change at 4,311. RSI in oversold zone. |
| SILVER -3.15% |
| Commodities are also feeling the pressure from the Fed. After Powell’s worrying announcement, equity markets started to discount important points, as the market anticipates possible unfavorable economic data. The sell-off also begins with retail investors, who, driven by the majors, start selling metals. At the moment the price of silver is falling 3.15% and is trading at USD$22.42 per Troy ounce. The price of gold is falling 1.36% and is trading at USD$1,800 per Troy ounce. |
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| Support 1: 22.414 Support 2: 22.344 Support 3: 22.240 Resistance 1: 22.588 Resistance 2: 22.692 Resistance 3: 22.762 Pivot Point: 22.518 |
| The price is at support 2, and selling volume continues to pressure silver. If the selling continues, the price could reach USD$22.06. Expected trading range between USD$22.24 and USD$22.76. Pivot point at USD$22.51. RSI in oversold zone. |
| ETHEREUM -9.97% |
| The announcement of more aggressive interest rate hikes is affecting the crypto market. Ethereum is currently down 9.97% and is trading at USD$3,420. The price of Bitcoin, meanwhile, is falling 7.33% and is trading at USD$43,015. Ethereum’s co-founder, Vitalik, announced that the Ethereum project is at 50% of development. Analysts continue to assess the potential for Ethereum to overtake Bitcoin in market cap and market interest. The main advantage of Ethereum is that it includes several important applications, among them, the reduction of commissions between financial transactions. |
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| Support 1: 3,432.02 Support 2: 3,412.17 Support 3: 3,396.84 Resistance 1: 3,467.20 Resistance 2: 3,482.53 Resistance 3: 3,502.38 Pivot Point: 3,447.35 |
| The price is at support 2, where a rebound could occur. The crypto is below the 200-day moving average, which is a bearish signal. Expected trading range between USD$3,396 and USD$3,502. Pivot point at USD$3,447. RSI in oversold zone. |
| WTI -0.31% |
| Commodities and other equity assets are collapsing. Meanwhile, commodity prices in the energy segment are not as impacted by the FED announcements at the moment. The WTI price is down 0.31% and is trading at USD$77.55 per barrel. Energy demand in Europe continues to increase. This is generating stability in WTI, Brent and natural gas prices despite the market fall. Analysts evaluate the continuity of the trend or a change in it, depending on the volume of transactions generated in the market. |
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| Support 1: 77.19 Support 2: 76.93 Support 3: 76.75 Resistance 1: 77.63 Resistance 2: 77.81 Resistance 3: 78.07 Pivot Point: 77.37 |
| The price is between the pivot point and resistance 1. Trading range between USD$75.75 and USD$78.07. Pivot point for trend change at USD$77.37. Bulls continue to search for USD$80 per barrel. RSI neutral. The price remains above the 200-day moving average. |
| Sources |
| Reuters Market watch Bloomberg Capitalix Market Research |
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