Daily Market Insights & Charts

Strong March NFP suggests more US data surprises to come


The US jobs market data in March were really impressive. Given momentum effect in the labor market and still incomplete recovery in consumer mobility, payrolls growth April may top 1 million. It means the odds of more economic surprises in the US from the key macroeconomic areas are quite high, which justifies elevated market expectations about US assets and USD performance. We cannot rule out that US labor market can achieve pre-pandemic levels by the end of the year which will certainly trigger premature Fed tightening. For now, it remains a tail risk.

The solid report on the US labor market for March indicated the growth of jobs by 916K against the 660K forecast. The payroll readings for the previous two months were revised upwards by 156K. Employment in the private sector rose by 780K, while the currently not very indicative unemployment rate fell to 6%.

Employment growth overtook the forecast thanks to warm weather which additionally boosted mobility and some economic sectors like construction, strong vaccination program in the US and economy reopening efforts from individual states, which boosted consumer sentiment, business climate, activity and labor demand.

Improved weather helped construction sector to boost hiring by 110K, continuing easing of restrictions led to an increase in jobs by 280K in the leisure and hospitality industry. Public sector employment increased by 136K. However, in no industry has demand for labor recovered to pre-crisis levels.

Expectations for the jobs market performance in April are high due to two reasons. Firstly, consumers mobility still has room to recover. Secondly, it’s reasonable to expect that recovery will continue given positive trend in reopening and non-stop supportive government measures. The following shows the dynamics of restaurant reservations for some key states, as well as the number of security checks at airports:


Source: ING

It can be seen from both charts that all the curves (with the exception of Miami table reservations) are still below the pre-pandemic level, so recovery still has a room to go. Consequently, the demand for labor should continue to grow.

Despite the positive NFP update, there are 8.4 million fewer jobs in the US economy than it was before the pandemic. The Fed has signaled that it will not raise rates until 2024 until there is substantial economic progress. Given their lukewarm attitude towards rising inflation, it is clear that they want to see jobs return to pre-crisis levels.

Officials' comments make it clear that unemployment is now giving false signals due to the large number of demotivated workers. Now only 57.8% of the working population is employed:



This is very low and, in some respects, comparable to the employment rate of the 1980s. To reach pre-crisis levels (labor force participation rates above 60%), the labor market should add at least 6 million jobs.


Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Upbeat soft data in the EU fuels tactical retreat of USD



Indices of activity in manufacturing and services sector in the EU indicated a welcomed expansion in March. However, it came with a decent delay due to lockdown extensions. Compared to the pace of recovery in the US, it’s still just a minor uptick. Nevertheless, it was enough for Euro to break a series of falls as there was a bunch of risks associated with extended lockdown which were priced in the European currency. The March data eased concerns about worst-case scenario for the EU and helped to downplay impact of slow vaccinations and lockdown pressure on business sentiment. EURUSD is developing a rather rapid upward movement, while USD index broke the main uptrend channel which casts doubts on immediate continuation of the advance:





Improving demand for Treasuries also played against the US currency. The yield on 10-year notes continues to decline after reaching a local peak of 1.774% on March 30. In my view it’s just another break in the broad downtrend. Labor market data, ISM indices, in particular the components of new orders and expectations, consumer mobility indices call to prepare for new surprises in April, so the positive impact of the flight from long-date Treasuries on the dollar should still remind of itself in the near future.

The recovery in the Eurozone was quite synchronous: Markit pointed to the growth of business activity in Germany, Italy, Spain and Ireland, both in services and in manufacturing. Together, these four countries account for three quarters of the Eurozone's economy. Firms see a surge in orders in the United States against the backdrop of the lifting of restrictions, so they are too very optimistic about the near future.

Today, clues about the further behavior of the dollar should be looked for in the minutes of the Fed meeting for March. Expectations are modest – reiteration of the mantra of ultra-easy monetary policy despite all the optimism taking place in the data. Still, there are fears that the dynamics of inflation will cause discomfort among officials. Therefore, if there is even a slight bias towards hawkish policy, even a hint of an earlier curtailment of QE, it will certainly resume the growth of Treasury yields and support the dollar. In general, it is too early to write off strong dollar.

On the other hand, the risks of weak vaccination rate in the European currency may be eliminated by news refuting the connection of the Astra Zeneca vaccine with blood clots. This will signal a recovery in vaccination rates - a key component of expectations that immunization targets will be met earlier and mobility will recover faster.

From a technical point of view, the upward correction in EURUSD may hit the 1.1930 - 1.1960 zone before we could start discuss resumption of USD rally:








Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Strong US CPI May Trigger Treasury Sell-off, Dollar Rise

Summary

- Long-dated bond yields picked up ahead of US CPI release, increasing odds of USD rebound;

- Solid China trade data, in particular growth of imports, underpinned oil prices.

Calm in the equity markets extended into Tuesday with US equity index futures swaying near the opening. However, debt markets appear to be strained. Bond yields advanced as the risk of higher inflation rates re-emerged in the past and this week’s data.

Today US consumer inflation report is due and there are good reasons to expect a surprise on the upside. The fact is that inflation on intermediate goods (PPI) in China and the United States came materially higher than forecasts in March, which is likely to affect the final prices due to cost-push inflation pressures. A strong CPI reading will most likely wake up the bears in the Treasury market, and again we will see a renewed uptrend in yields and USD. EURUSD will probably not hold at the current levels and likely go down to 1.1850-1.1860, given tepid behavior of the buyers after reaching 1.19 mark:





Accordingly, a breakout of 1.70% level in 10-year Treasury Note yield may become a technical signal for resumption of the rally to new local highs. The factor of Treasury sell-off, as shown by the dynamics of USD in March and February, is probably the most import in the currency’s strength.

ZEW report on corporate sentiment in Germany, which is usually of high importance, can be ignored, as investors focus on data on vaccination pace, as well as news on the European Recovery Fund, which still has a long way before approval and which could be the factor of Euro strength, similar to fiscal stimulus in the US.

China foreign trade showed mixed dynamics - export growth did not meet expectations, but imports accelerated significantly (38.1% versus 23.3%). Details also showed that China ramped up oil purchases, which came as a surprise. Oil prices rose moderately, but the focus is on successes or failures in suppressing the virus. The situation in this regard is very ambiguous - the deserted streets of India due to record daily growth on the one hand and the rapid recovery of mobility in the United States or Great Britain due to the weakening of the restriction on the other.

Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Markets are not afraid of US inflation risks

Summary:

- Markets reaction to US inflation report was rather restrained, which came as a big surprise and has medium-term implications for USD;

- The basis of bearish pressure in GBPUSD is largely lockdown-related risks, the chances of which are falling.

Despite highly upbeat reading of US March CPI, markets’ reaction to the event was quite unusual – long-dated Treasury yields skid, pulling lower disappointed dollar. This suggests that the prospects for inflation and growth are largely factored into valuations - the market has gone far ahead in its inflation outlook and will be difficult to surprise. At the same time, the number of arguments against buying the dollar is growing - the net position of speculators in futures has approached neutral (net short is only 2% of open interest), which reduces the opportunity for short-squeeze, the Fed is resolutely rejecting speculations about tapering of asset purchases, and on the other side of the Atlantic, economic activity is reviving, making growth more synchronous, which takes the advantage off the USD.

EURUSD continued to rise, thereby completing the "flag" pattern (one of the trend continuation patterns). However, now the pair is in the area of overlap of the upper bound of the downward trend channel and key horizontal level. The previous attempt to break out and go beyond the upper border of the corridor in a similar situation ended unsuccessfully, and sellers retained control. Successful consolidation above the level of 1.1950 may be considered as a signal that the pair is returning to a medium-term uptrend:






The pound sterling came under pressure yesterday after news that the chief economist of the Central Bank is leaving his post. Andrew Haldane was one of the main hawks in the Central Bank of England, so the path to raising rates may be longer, due to decline in the general policy bias of the Central Bank to quickly normalize credit conditions. However, the main focus remains on the pace of vaccination and the UK is doing well in this. Among the latest news, England's superiority in this regard is notable - take, for example, the fact that more than half of the adults in the country received the vaccine. In the GBPUSD pair, after the correction from 1.40, many risks related to the last lockdown remain priced in, which, as time shows, are unlikely to materialize. This justifies gradual strengthening of the pound against the main peers - EUR and USD.

On the technical front, the pound is likely to test the upper boundary of the correctional channel (1.3850) against the backdrop of retreating USD:




Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Shale oil is slow to recover removing on the key caps for oil price growth



The data on US crude oil inventories has brought noticeable relief to the market, once again hinting on lack of shale oil output rebound, despite warming weather and strengthening demand. Inventories dropped by ~5.9 million barrels last week, more than double than the forecast. Gasoline inventories declined more than expected as well, indicating that consumer demand remains strong.

The report apparently came as a surprise to the market. Oil prices jumped upwards on the release, breaking through the trading range that formed after the last oil mini-collapse:





Production in the US is indeed recovering slowly despite increasing rig count. It means that on the supply side, the picture is still quite favorable for price growth:





The IEA's monthly report released on Wednesday also pushed prices higher. The agency has significantly raised its forecast for oil consumption in the second quarter of 2021, which makes it possible to expect the market to better cope with the forthcoming increase in OPEC production.

The geopolitical factor also accompanies the rise in oil prices. The chances of a quick conclusion of a nuclear deal between Iran and the United States have decreased due to the escalation of the conflict between Israel and Iran, which means that a quick return of Iranian barrels to the market (with a potential of 2 million bbl/d) is not to be expected.

Another piece of data on inflation in the US again exceeded expectations, but assets’ market lacked response. Import and export prices for March were significantly higher than the forecast, indicating that supply is not keeping up with demand. This is a perfectly reasonable assumption, given the series of fiscal stimulus in the US that has sparked a surge in consumer demand. By looking at prices in terms of their signaling function to producers, firms will start adjusting their output in response to price increases, so we first need to see inflation.

It is becoming increasingly difficult for the Fed to maintain the status quo against the backdrop of hints of inflation coming from “all the cracks in the economy”. Therefore, commenting on what is happening, officials are increasingly saying that inflation is not a problem and monetary stimulus are not endless. Yesterday the head of the Central Bank Powell said that the curtailment of QE will begin "much earlier" than the rate hike, and the Fed is going to keep rates at the current level at least until the end of 2022 (previously the deadline was until the end of 2023).

The early withdrawal of monetary incentives is one of the main threats to the growth of risk assets. An important component of their fundamental assessment is the cost of credit, which justifies their high sensitivity to any hints about an early tightening of the Central Bank's policy.



Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Falling yields open opportunity to short Gold



The most notable move in asset markets this week was collapse of US yields. The 10-year Treasury yield, which has exploded since the start of the year on accelerating inflation expectations, tumbled to the lowest level since early March:





Most interestingly, this happened against the backdrop of the release of quite pro-inflationary reports - strong US CPI, stellar retail sales, US labor data. Recall that in March, consumer inflation in the US accelerated to 2.1% YoY, retail sales by 9.8% in monthly terms while unemployment claims rose by 576K (the lowest since the beginning of the pandemic). All three indicators beat forecasts, however expected sell-off in bonds never happened. Moreover, investors began to flow back en masse to long-term bonds. As a result, gold skyrocketed due to lower opportunity costs and the dollar came under pressure.

The strange bond move could be explained by heightened geopolitical tensions, in particular, between Russia and the United States over the Ukrainian issue. There were also reports that the downward movement of yields triggered coverage of short positions in the Treasuries, one of the backers of which was "Bond King" Bill Gross. At the beginning of the year, he advocated shorting Treasuries on a potential surge of inflation. Inflation did accelerate, but there was no surge, so his bond position and his followers could be under pressure.

In my opinion, yields will not be able to hold out for a long time at the levels where they are now after a fairly rapid pullback. The reason for this is unchanged inflation trend in the United States. Recent economic data marked beginning of the accelerating trend in price growth. There are no potential catalysts on the horizon for a sharp slowdown in inflation or that could lead to inflection points in the trend. Considering the instruments most available to trade this idea, gold is striking. It is currently approaching the upper border of medium-term downward trading corridor ($1800) …





…which could be a good selling opportunity if we bet on integrity of the channel. Surely this will require a resumption of growth in yields, but there are all the prerequisites for this. The most important of these is continuing trend in lifting of social restrictions and subsequent emerging consumer impulse that generates price increases. In Europe and in a number of other countries, it is still waiting for its moment.



Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

EUR, GBP and JPY: near-term technical setup against USD


The most notable event in FX market on Monday was steep fall of the greenback. The currency index erased half a percent through rather sharp downward moves, which could indicate a large dump. The US currency has been taken away one of the key footholds – ssell-off in long-dated US Treasuries. Massive sales observed in February and March has been fueling demand for cash, however, this driver has suddenly lost steam last week - strong pro-inflationary data in the US (CPI, retail sales) for March met relatively tepid reaction of the bond market. Apparently, this forced dollar holders to ditch the currency.

Analyzing the possibility that the dollar will continue to fall, it is worth paying attention to the technical situation in the pair with the main rival - the euro. Earlier, we discussed a scenario where price after breakout of the horizontal + sloping resistance level (1.1950-60) may set the stage for protracted euro rebound if it stays above the level for several days. Price action on Monday indicates realization of this setup:






The ECB decision this week may open up additional growth prospects for the European currency. If the Central Bank sees optimism in the data and speaks less about the need to maintain huge asset purchase stimulus, the euro will get a support factor in the form of the European Central Bank’s slightly less dovish stance. Chances abound due to unexpectedly strong European data for March.

The dollar's downward jerk also affected GBPUSD - the pair broke through from the bottom up the correctional channel, which has been going on since March, which opens the way to 1.40 after a technical pullback:





The movement could be catalyzed by employment and inflation data on Tuesday and Wednesday. Particular attention should be paid to the inflation report, as due to the rapid pace of vaccinations, the chances of seeing a consumer boost in March are high.

USDJPY did not stand aside either. However, it should be borne in mind that technically the yen was strengthening extremely quickly against the dollar (hourly RSI is below 20 ppoints), which increases the chances of a rebound. Potential entry area - intersection with the medium-term trend line (107.60-70):






Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Pressure on USD rises ahead of possible dovish Fed move

The CFTC data showed that net long speculative position on EURUSD rose last week, which suggests the shift in sentiment on the pair is under way after protracted squeeze of long positions. Historically, the euro net long position is within one sigma, i.e., far from extreme levels and there is still room for bulls to ramp up pressure. Speaking of the short term, there was no particular rush of buyers after the test of 1.21 on Monday - the major move is most likely set for Wednesday, when the Fed will clarify the course of US monetary policy. And again, the main question is when to expect unwinding of current pace of QE purchases. Long-dated Treasury yields advanced on Monday, signaling return of inflation concerns as well as worries about possible Fed meeting outcome where the regulator hints that reduction in credit stimulus could begin in the less distant future.

The European currency is also drawing strength from progress on the fiscal front. Positive news on the European recovery fund (large-scale fiscal stimulus) triggered some sell-off in European bonds, due to reassessment of inflation expectations. The yield on 10-year German bonds is again moving towards the local high of this year (-0.217%), while the sell-off appears to be stronger than in long-dated Treasuries:





The dollar index is moderately correcting downwards, having touched the lowest level since the beginning of March (90.65). Despite the coronavirus crisis in one of the largest emerging economies (India), expectations for a global recovery persist, as evidenced by the positive dynamics of industrial metals prices. Iron ore and copper have resumed their uptrend since early April, reflecting expectations that demand will continue to rise:






The theme of recovery this week may be supported by the data on the US economy, in particular GDP, orders for durable goods and claims for unemployment benefits. Output growth in the US economy for the first quarter is expected to be an impressive 6.1%. Given benign environment, better-than-expected data updates should fuel risk appetite. If the Fed gives a signal that it will tolerate overheating of the economy, there will be even less sense to stick to USD positions till the next meeting.

Joe Biden's first speech to Congress will also take place this week, in which he can provide more details on tax reform. For risk assets, the details are likely to be negative, so US indices are likely to decline ahead of the speech.




Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

“Frozen” USDCAD and the upcoming Fed meeting: markets overview

FX and sovereign debt markets are bracing for the bout of turbulence ahead of the Fed event today. Despite success in spurring inflation growth, the Fed’s message will likely remain unchanged – substantial observed progress in employment is an essential condition to depart from accommodative policy. Yield differential between the 10 and 2-year Treasuries will likely extend gains on a dovish message - which should support EM currencies as well as Norwegian krone and CAD.
US long-dated yields have rebounded ahead of the Fed, halting decline which lasted about a month:



The US dollar were also offered support thanks to signs of renewed bond market rout and set to test the upper bound of downward channel in which it currently resides:



Inflation premium in long-dated Treasuries could be fueled by the US consumer sentiment report released on Tuesday. Consumer sentiment index jumped to 121.7, the highest since February 2020. The report reinforced fears that supply in the economy is not keeping pace with rebounding consumer demand, which should result in faster inflation. There are signs on the supply side that justify those fears: for example, quickly rising maritime shipping rates or, for example, updated profit forecast of the largest container operator Maersk. The company has doubled its profit forecast for 2021 due to "exceptionally strong" demand for its logistic services.
Given these findings, if the Fed continues to cling to the transient inflation argument today and leaves QE timeframe unchanged, the US real rate will be under pressure again. This time, however, we have less patchy global growth, so there are plenty of alternatives to US fixed income assets. This should stimulate the search for yield abroad. The effect on the dollar appears to be negative.
However, pressure on USD will likely be uneven. Given positive correlation of yielding currencies with the spread between 10-year and two-year US government bonds, in particular the Canadian dollar, today's message from the Fed may open way for their further rally. By the way, the CAD has been behaving strangely in the couple of last days, fluctuating in a very narrow range after strong sweeping moves earlier:



Continuation pattern?

Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Continuing US bond rout may offer some support to USD next week


Incoming economic data of developed economies in the second half of the week, dynamics of commodity prices (record price of steel futures) added fuel to the flight from long-dated bonds:






US GDP growth beat forecast in the first quarter of 2021, averaging to 6.4%, while quarterly inflation measured through GDP growth accelerated to 4.1% against expectations of 2.5%. Despite weak output in Germany and threat of technical recession in the first quarter, price growth there also accelerated above expectations in April.

US unemployment claims that came on Thursday were slightly weaker than the forecast - both initial and continuing claims gained more than expected, nevertheless, the markets are bracing for a very strong increase in the April NFP of 925K. The report is due for release on next Friday. If job growth meets expectations or even beats forecast, rumors that the Fed will move to tapering earlier than previously expected should increase, as according to the Fed, substantial progress in employment is the key goal of ultra-easy credit policy. Inflation expectations are also set to accelerate in this case, fueling more upside in yields which in case of rapid movements may offer support for USD.

It is clear that US debt market became more concerned about the threat of inflation this week. However, in the current environment, inflation is a synonym of expansion, which means demand for risk is likely to stay here as the dominant market theme. At the very least, it is difficult to expect that there will be a reason for a collapse and even a correction. The Fed added fuel to the fire on Wednesday, once again declaring that "it is not time to even discuss the changes in QE purchases". Cheap credit policy, coupled with economic pickup will likely continue to push prices up and the risk that inflation will accelerate haunts bonds. The Fed stubbornly denies that inflation will be here for a long time and is trying to convince market participants of this. As you can see, it doesn't work out very well.

The dollar sank after the Fed meeting, but is trying to recover for the second day in a row. Yesterday, consolidation above the upper border of the descending channel failed, but on Friday the chances of this are much higher:






Next week we may see a slight strengthening of the dollar towards 91.00-91.20 amid bond pressure ahead of a possible NFP surprise. The bar to surprise is very high and if the report fails to meet expectations, USD will likely start to drift lower from those levels.



Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

USD set to stay range-bound given moderate US data updates



The buying wave in USD emerged last Friday appears to be losing punch as US currency retreats against major peers. However, resumption of sales may take longer than bears could expect. To bet on further USD slide, markets may need data updates that would shift risk-seeking flows to assets outside the US. However, this week, key reports will be related to the US economy and weak US currency should be expected in case of a downside surprise in Friday Payrolls.

In general, post-pandemic recovery in the United States is going well. Last week, this was indicated by data on consumer spending and U. Michigan consumer sentiment report, which came a tad stronger than forecasted. Long-term market rates in the US generally sway near opening Monday and US currency has not been offered support from this side.

At the same time, markets learned last week that the European economy is getting out of the recession faster than forecasted. Key macroeconomic variables more than met expectations - GDP for the first quarter, inflation and unemployment in April, which sets the stage for appreciation of the Euro as EU recovery momentum catches up with the US.

We have entered a new month, so it is also worth to consider seasonality factor. May usually turns out to be favorable for the dollar, this is probably due to the fact that corrections in risk assets often occur in May. Keep in mind the well-known saying “Sell in May and go away”, which this year may remind many investors of itself.

The upper border of USD index strengthening this week will most likely reside at 91.55 points. This is a two-week high. For EURUSD it is approximately 1.1990 and 1.3780 for GBPUSD. These levels may not hold in case of a correction in US equities, which would open the door for rally in the index towards 92.00. However, this is difficult to expect morally, given that the consensus on Payroll’s growth in April is almost 1 million jobs. There are also many anecdotal evidences indicating that the service sector in the United States simply lags behind the consumer boom, failing to hire required number of workers.

Investors also listen to Powell, but continue to do their own thing. Weekly inflows to funds investing in inflation-protected bonds continue to remain at historically high levels:





In our case, elevated inflationary expectations reflect the investors’ opinion that there is strong demand in the economy, which, of course, is barely a macroeconomic basis under which a correction should be expected.

Commodity markets are on the rise, as can be seen from highest in years reading of the Bloomberg Commodity Price Index, which basically forces investors to expect continued rise in cost-push inflation in the coming months:





The largest threat for further USD dump is a fresh sell-off in Treasuries. However, we have to see material gain in Payrolls above forecast to see another leg of inflation concerns. In addition, bond pressure could emerge after the release of ADP and PMI in the US non-manufacturing sector on Wednesday. The focus will traditionally be on the employment component. Moderate data should take away support from USD as any sign of cooling in the US momentum is what bond bulls exactly want for.



Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Developed economies compete in the pace of recovery. Which one will win?


Developed economies keep competing in the pace of recovery. UK data showed on Tuesday that manufacturing activity rose to its highest in more than 26 years:





Interestingly, the Markit report mentioned the same challenge also faced by US and EU producers: supply chain bottlenecks, resources and inventory shortages. This results in the rise of intermediate prices and response to this is the same everywhere - push the increase further in the price chain, i.e. hike end prices. However, the temporary consumer boom against the background of lifting of the pandemic restrictions makes it easy to do this, so cost-push inflation does not yet run into demand constraints, causing steady upward inflation trend.

The data on activity of manufacturers in the US and German economies were somewhat disappointing, but still it was quite strong. Looking under the hood, primary drivers of growth of the broad index were extremely high readings of new orders and prices components, while components of inventories and customer inventories made negative contribution:





Nonetheless, central banks have been slow to sound the alarm and tighten credit conditions in response to the threat of inflation pickup. But there is still some progress in this matter. Yesterday the head of the New York Fed Williams spoke, who admitted that the Fed could raise interest rate on excess reserves for banks or reverse repo rate. Both measures are intended to remove excess liquidity from the banking sector, although they are quite technical in nature. However, in the past, they preceded the start of normalization of credit conditions, so the dollar bulls took this hint with great optimism.

On Tuesday, we saw increased demand for greenback thanks to Williams comments, USD index climbed to 91.40 which is highest level since the start of the week. Today, the report on activity in the US service sector from ISM is due which should help to prepare better to the NFP surprise as well as give an idea of what is happening with services sector inflation in the US. Strong reading, especially driven by prices and hiring components will likely to push USD index higher with potential test of 91.55 resistance level, however further upside is under question and will require more reflation optimism, i.e., strong NFP surprise.



Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

US data may drive EURUSD lower, providing good buying opportunity


Another leg of USD rally took place yesterday amid sell-off in US equities. The bout of risk aversion was fueled by the comment of the US Treasury Secretary Janet Yellen that a rate hike may be needed to prevent economy from overheating. The caused market turbulence in various asset classes, including stocks and USD, revealed lack of trust of investors to the Fed comments, showing that the Fed pledge to keep rates low and the stance on inflation (“we see inflation as temporary factor”) are taken with a grain of salt. Yellen later clarified that her comment was not a recommendation or a forecast for an interest rate hike, which is not surprising, because just a week ago we saw very cautious Fed rhetoric regarding rate hikes. Fed Speaker Charles Evans' speech today is likely to address market rumors sparked by the Yellen remark.

The last three upside swings in USD were distinguished with length of the waves getting progressively shorter, while meeting resistance at the two-week high of 91.40:



Such a price action, together with the stabilization of ATR and RSI near their averages, often precedes a breakout move. Taking into account the pressure of buyers its vector will likely be positive. The breakdown catalyst is expected to be the Non-Farm Payrolls report on Friday.

Two other reports to look out for are the ADP US Job Growth Data and the ISM Service Sector Index. They will play an important role in shaping expectations for the NFP. The ADP is expected to point to an increase in jobs of 850,000 in April, while the ISM index is expected to rise from 63.7 to 64.3 points. Particular attention should be paid to the hiring component of the ISM index, as its predictive power in relation to the NFP report is quite significant. The two strong reports also once again could cast doubt on the Fed's ability to maintain current degree of monetary easing, which, in particular, may result in faster growth in long-dated bond yields. As I wrote on Monday, news and data flow this week favors tactical strengthening of USD as the reports on the US economy take central place in the economic calendar this week and risks are shifted towards positive surprises in the data.

For EURUSD, the breakdown of lower border of the trend channel disabled it for some time, but there was no particular rush to sell near the critical 1.20 level as seen from little pressure in RSI:






In this regard, the level can equally act as a foothold for growth after completion of the correction. The 1.1950 test on the release of US statistics looks like a logical scenario, but let’s not forget what drove the recent strengthening of EURUSD - progress in vaccinations, European fiscal stimulus and economic data. Next week, the news background is expected to be more favorable for the growth of the European currency.



Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

US data disappoints, laying the groundwork for weaker NFP expectations


Brent price failed to break above the $70 level on Wednesday, as buyers' appetite is still constrained by some demand risks. Concerns about demand in India as well as expectations that OPEC will soon begin to lift output restrictions weigh on prices. Recovery of Iranian supply also makes growth more cautious. Although it now seems that the market will be able to absorb new supply, there are risks that the outlook for demand will become less optimistic, which will lead to a more fragile balance in the market.
Saudi Arabia has announced its June OSP prices and, given OPEC's concerns about demand and upcoming production increases, prices for Asia have been cut an additional 10 cents. The Saudis have also lowered prices for other regions, for example for Europe the over-benchmark premium has been reduced in all grades. However, US prices have been raised. The multidirectional movement of price discounts for different regions suggests that OPEC evaluates the prospects for a recovery in demand in different ways, and also takes into account different levels of risks.
The EIA report showed that oil stockpiles in the United States fell by 7.99 million barrels in the reporting week, which significantly exceeded the forecast of -2 million barrels. This strong decline was driven by several factors, in particular increased capacity utilization rates of refineries. Now it is at its highest level since March last year. Oil exports increased by 1.58 mln bpd to 4.12 mln bpd. Only four times in history US oil exports topped 4 million bpd what looks like an indication of a really strong near-term oil demand picture, especially for US supply.
Technically, the corrective rally in oil after breakout of the key trend line took place in a narrowing channel, which indicates a keen buying pressure. The price approached the March high however potential breakout of the main resistance line is likely to be short-lived (false breakout), since risks in the news background are shifted towards neutral and negative events (growth in Iranian output, US shale oil recovery, planned increase in production OPEC, etc.). Most of the positive on the demand side has already been priced in by the market in one way or another:



Yesterday data on ADP and ISM in the US were not as strong as expected which became a major disappointment. The growth of jobs according to ADP was 742K (forecast 800K), the ISM index did not live up to expectations:



With this data in mind, optimism about Friday's NFP declined. This eased pressure on long-term yields and the dollar. The yield on 10-year US Treasuries retreated as less strong labor market growth would mean less acceleration in inflation – the biggest threat of real bond returns currently:



It is clear that the risk of a weaker NFP report has risen, so the markets could start to brace for a negative surprise on Friday. If the report does turn out to be so, the bearish trend in the dollar is likely to resume, as more inconsistencies will appear in the story with higher inflation in the US.


Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Real rates story unfolds not in favor of USD

A number of central banks held monetary policy meetings this week. They clearly showed a tendency to speak or take decisions related to the tightening of monetary policy. Brazil, following the Russian Federation, raised its key rate from 2.75% to 3.5%. Overall, emerging market economies are shifting from talk to action and lift interest rates in response to rising inflationary pressures. The G10 countries have progressed much less in this sense, but those of them that at least talk about raising rates or reducing QE have successfully drawn attention of foreign investors. Among them are Canada and Norway, which were relatively open about their plans to curtail credit stimulus, which sent their currencies higher against USD.
Yet in the US, we have a radically new Fed approach to stimulating growth and employment. It implies low rates even though there is clear progress in inflation. If other central banks are not going to play this melody, and apparently, they are less inclined to do that, their real interest rates will likely rise faster compared with the real rates in the US. Of course, this dynamic will gradually put pressure on the dollar, as investors will follow the Central Banks that tighten policy, thus pushing higher real returns on local assets.
That is why this week we saw emotional market reaction to the awkward remark of the US Treasury Secretary Janet Yellen, that economy overheating may require interest rate hikes to tame it. To avoid confusion with the Fed guidance, she was quick to clarify that she does not predict and does not recommend a rate hike. Yesterday, Fed representative Robert Kaplan said that it is equally important not to be late with policy tightening, as asset market bubbles and excessive risk-taking fueled by low interest rate environment increases vulnerability to actual Fed tightening.
Focus today on April NFP report. The market expects job growth by 1 million. A positive surprise could in theory mean that the Fed is moving faster towards the employment target, and therefore may begin to phase out monetary stimulus earlier. Therefore, a positive surprise in the data is likely to trigger a new sell-off in long bonds and hit the dollar, as from the discussion above, the situation with real rates in the US will change to the worse for the dollar. In addition, in other large economies, data continues to improve, which changes the forecast for local real rates in a positive direction. This includes data on PMI in China, as well as European statistics released this week. A strong NFP report is likely to allow the dollar index to touch the 90.50 level:



Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Weak April NFP: What does it mean for Dollar and US stocks?


April Non-Farm Payrolls report was a huge blow to expectations of an early Fed policy tightening. Despite generally strong economic background in April, jobs count printed three times less than the forecast of ~1M. Of the more than 50 surveyed economists by Bloomberg, only two of them forecasted jobs growth below 800K. Unemployment rate surprisingly trended higher as well. The Fed's status quo with regard to low rates and QE has gotten a solid excuse, which together with strong commodity inflation outlook ensures further focus of the debt market on inflation risks. What this means for stocks and greenback is discussed below.

The 10-year Treasury yields, after initial downward spike on fears of slower growth in the US, trimmed decline quickly and closed near the opening on Friday:





What could it mean? Bond investors might not perceive weak job growth as an alarming symptom for the economy: such nuances as a shortage of labor supply due to generous government benefits, significant seasonal adjustments suggested to focus on the trend in US jobs growth, rather than on a single month’s print.

The report removed one of the key hurdles to USD downtrend - the risk of early tightening of the Fed's monetary policy. Risk assets got the welcomed mix of moderate growth prospects and stronger guarantees of cheap liquidity that’s why we saw confident rally on Friday. SPX rallied to new ATH, closing close to a record high, while index futures pulled back only marginally on Monday.

Iron ore futures, one of the benchmarks for commodity inflation, jumped 8% on Monday, which is likely to slowly but surely fuel worries in bonds:





Also on Friday, we saw a new record in inflation expectations in the US following the release of the report:





Given the dynamics of commodity prices, this trend is likely to continue, that is, more downward pressure is coming for real rates in the US. This will also add pressure on USD and spur search for the yield, both in alternative asset classes (stocks) and bonds outside the United States, where the prospects for tightening Central Bank policy are better and inflation risks are less severe than in the US. In terms of the FX implications for the major currency pairs, EURUSD and GBPUSD, we are likely to see continued gains this week with targets at 1.2250-1.23 and 1.42-1.4250 respectively.


Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

High inflation concerns could be the reason for more stock market pain


US tech sector saw onslaught of selling orders on Monday, pulling down the universe of risk assets. Nasdaq market cap erased 2.5%, which was the deepest pullback in several months. The rest of equity indices saw less severe declines, however, gloomy sentiment stretched on Tuesday – US equity futures extended decline, strong weakness is also felt in European markets.

Correction in risk assets once again helped greenback to dodge a sell-off. The dollar index bounced off 90 level, however the rebound has fizzled out near 90.35 mark.

Long-term interest rates in the US renewed rally, rising to their weekly high (1.62%).

It’s hard to pin down exact causes of the pullback, however consensus in the media is that anxiety about inflation outlook gained critical mass, provoking sell-off. In fact, in addition to the official data indicating revival of US inflation to the level not seen in a decade, there are some alternative gauges suggesting that inflation rate in the near future may indeed cause economic discomfort. Here is, for example, a comparison of inflation rates and mentions of the word "inflation" in earnings calls of US companies:





The number of mentions soared 800% and considering the correlation of this indicator with inflation rate, the United States can indeed expect a period of relatively high rates of price growth in the near future as firms will likely pass increased costs to consumers.

Inflation has also started to appear more frequently in Google searches:





The number of searches of “inflation” is at all-time high signaling that consumers could become more concerned about inflation outlook. This indirectly indicates that consumer inflation expectations are set to increase further, making it even harder for the Fed to call inflation a transitory phenomenon.

If inflation is really a concern for the markets, Wednesday CPI report may become a new catalyst for equities decline if price growth accelerates considerably above forecasts. So, it could make sense to wait and see April inflation print before trying to buy the dip in equities or enter USD shorts.

Key events for the rest of the week:

-Speeches by representatives of the Fed, in particular, FOMC member Lael Brainard on Tuesday.

-OPEC's monthly report, which will include crucial production and demand forecasts for Q3.

-The US CPI report on Wednesday, which could heighten market concerns about high inflation in the near future.

-Bank of England Governor Bailey is scheduled to speak Wednesday at which the UK's QE reduction will be likely discussed.


Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

The risk of commodity markets correction creates buying opportunity in USDCAD


On Wednesday we see first signs of easing bearish grip on equities after the two-day violent selling. European markets are trading in positive area, US equity futures show some signs of distress ahead of the April US CPI release.

The foreign exchange market looks calm today, the slump in US equities offered temporary reprieve to USD. However, greenback fundamentals continue evolve towards more bearish pressure on the currency. One of the key reasons to sell is deteriorating real interest rate outlook in the US. The Fed’s policy tightening hopes were shattered after dismal April NFP release, while the fears of high inflation in the US, even temporary one, continue to mount. The sources of inflationary pressures are rising wages and the strong uptrend in raw materials. Recall that MoM US wage growth in April surged to 0.7% (0% expected), which is a really strong print, likely pointing to some labor shortage issues, while the Bloomberg commodity price index began to grow in early April at worrying pace:





Most likely, a correction in commodity markets will soon follow, which will primarily catch on significantly strengthened commodity currencies, such as AUD and CAD. Therefore, it is reasonable to expect their growth peaking in the near future. Particularly interesting in terms of the prospects for a rebound is the USDCAD pair, which is now at its lowest level since September 2017, which also coincides with the psychologically important area of 1.20:





US inflation is expected to accelerate to 3.6% y/y in April, but given stock markets reaction to inflation fears this week, some upside surprise, like 4% print can be already priced in. Inflation growth above forecasts is likely to keep the pressure on USD, given Fed’s Vice Chair Clarida speech today confirms the commitment to keep rates low despite inflation threat. Nevertheless, the dynamics in the stock market and geopolitics (exacerbating conflict in the Gaza Strip) should be the primary drivers of USD till the end of the week.

The move in USD in the Wednesday morning has barely affected low-yielding currencies, including the euro. Despite a significant improvement in the EU’s virus situation and progress in vaccinations, which creates a strong support in EUR, short-term dynamics will depend on USD moves. The same can be said for GBPUSD, where the recent rally requires both a profit-taking pullback and more data on the British economy. The signal from the Bank of England that policy tightening may start earlier than planned has been priced in by the GBPUSD during the recent strengthening to 1.42. Nevertheless, both the pound and the euro retain prospects for further strengthening against USD, in particular after there are signs that equity markets correction is done and risk-on dominates again.


Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Commodity market rally hits pause putting commdollars under pressure



Risk assets and oil remain under pressure on Monday while gold and other safe heavens are marginally higher. Among numerous market developments we would note stabilization of commodity prices after the rapid growth in April - early March:





The Bloomberg commodity index posted a local top on May 12 and then started to retreat. At the same time, we saw a pullback in a number of market bets associated with expectations of accelerated consumer inflation. First, the yield on long-dated US Treasury bonds started to ease last week:





As it can be seen on the chart, the yield jumped last week on US CPI report release, however it couldn’t sustain gains - having climbed to 1.70%, the yield steadily declined in the second half of the week. Material pro-inflationary surprise in US retail sales on Friday was apparently discounted by the Treasury market as the yield continued to slide on Friday.

Second, commodity currencies, which uptrend were fueled by the rise in commodity prices, embarked on a downtrend: at the time of writing, AUDUSD is down 0.41%, NZDUSD is 0.66%, USDCAD is up 0.23%. At the same time, their weakness could not be attributed to the broad strengthening of the dollar, as the US currency declined against the EUR and GBP.

The commodity market could be under pressure due to the increase in the incidence of Covid-19 in the Asian region last week and related new restrictions. In addition, PPI and the component of input prices in manufacturing PMIs in the US, Europe, and some Asian economies rose strongly in April. For example, in deflationary Japan, wholesale prices rose at their fastest pace in six and a half years, data showed on Monday. High prices for production factors could become an inhibiting factor for activity in the sector, as a result, the demand for raw materials could find a local high. Also, worth noting is the weak data on the Chinese economy, released on Monday. Growth in retail sales has lagged well behind forecasts, dampening risk appetite.

Earlier I wrote that overheated by historical standards commodity market is poised to cool down, which can hit primarily commodity currencies. Taking into account synchronized developments in commodity and Treasury market, commodity dollars, correction could be already under way, which creates selling opportunities. Particularly vulnerable in this regard are CAD, AUD and NZD, which advanced by an average of 9% against the USD since the start of “commodity supercycle” in November 2020.

Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Oil’s retest of key resistance levels leaves USD vulnerable to attack


The rally in Asian equity markets, positive news flow regarding the virus as well as oil move towards key levels, sparking momentum in the rest of commodity complex, put USD under great pressure on Tuesday. The FOMC Minutes release today may secure the breakout below 90 points in the DXY as the Fed will most likely reiterate its uber-dovish stance that they remain committed to easing. In Europe, the progress in easing of social restrictions lifted bullish sentiment in the Euro.

The next target in USD index is the area of 89.72-89.50, where a medium-term low was formed in the end of February:





In terms of momentum, the move was clearly excessive as seen from the RSI dropping to extreme levels (<20 points). This fact increases chances for a technical pullback from the support area towards 90 level before we could resumption of the medium-term downside.

Brent crude oil benchmark pierced through $70/bbl resistance for the first time since mid-March amid signs of declining global inventories as reopening of economies fuels a boom in demand, including demand for basic commodities like oil. An important signal that sets the stage for bullish oil move is a welcomed decrease in daily cases growth in India which is one of the largest oil consumers in the world. The virus situation in Asia is improving despite a spate of negative headlines hitting the wires in the second half of the past week, as governments managed to avoid worst-case scenario - continued increase in positivity rates and harsher social distancing measures.

Last week, the IEA reported that the oil glut accumulated during the pandemic had been cleared thanks to fast recovery in demand. The news fueled rumors that the market can face deficit in supplies in which lifted prices of near-term contracts compared to longer ones. Futures spreads in the oil market widened signaling that backwardation state intensified.

On the technical front, oil keeps developing a bullish picture. This week we saw a retest of the previous resistance level at $70 while the uptrend remained intact. If quotes manage to close above $70 per barrel, the next target is the level of 71.22 which is the intersection of the upper bound of current uptrend and the prices peak in 2021:






Disclaimer: The material provided is for information purposes only and should not be considered as investment advice. The views, information, or opinions expressed in the text belong solely to the author, and not to the author’s employer, organization, committee or other group or individual or company.

High Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% and 72% of retail investor accounts lose money when trading CFDs with Tickmill UK Ltd and Tickmill Europe Ltd respectively. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.