Daily Market Outlook – Tuesday, July 23


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 On Tuesday, Asian stock markets are mostly trading higher, taking cues from positive global markets. Traders are taking advantage of the recent market slump to buy stocks at a discount, especially in the technology sector. However, they are cautious about making big moves before the release of key US inflation data later in the week. The upcoming inflation data could have a significant impact on interest rate expectations, with the US Fed widely anticipated to lower rates by a quarter point in September. In a surprise move, China’s central bank also reduced its one-year benchmark loan prime rate in an effort to support its slowing economy.Asian currencies also strengthened against a weakening dollar. Following a significant tech selloff due to high valuations and sectoral rotation, markets are now pausing for breath. While the US election remains a major focus, Kamala Harris has secured enough pledged delegates to win the Democratic presidential nomination, bringing clarity to that aspect of the political landscape.The U.S. is expected to see a rate cut in September, while a 25 basis-point cut is anticipated in October for Europe. Despite upcoming Eurozone consumer confidence figures and U.S. existing home sales, the market outlook is unlikely to change. Traders are expected to focus on earnings reports after the market closes for Tesla and Alphabet, the first of the “Magnificent Seven” stocks to report. Tesla’s profit margins are predicted to decrease, while Alphabet is expected to report a fourth consecutive quarter of double-digit revenue growth due to an increase in the advertising market. Google reversed its decision to remove user-tracking cookies from its Chrome browser, yielding to pressure from advertisers who rely on cookie data for targeted advertisements. In Europe, Louis Vuitton’s earnings after the market close will provide insight into Chinese demand. Luxury stocks saw gains after surprise rate cuts in China on Monday, but the sector has been impacted by reduced spending in the world’s second-largest economy. Profit warnings from Burberry and Hugo Boss, along with a 27% decline in quarterly sales in greater China at Richemont last week, have dampened hopes for a stronger second half.
 Overnight Newswire Updates of Note

  • Citi Warns Of Euro-Yen Intervention Risk If Pair ‘Threatens’ 180
  • Large Deficits To Keep U.S. Debt Burden Rising After November’s Elections
  • Harris Campaign Secures Enough Delegates To Clinch Presidential Nomination
  • Biden and Harris Meeting With Israeli PM Netanyahu At White House This Week
  • Biden’s Withdrawal From US Presidential Race Spells New Uncertainty For Ukraine
  • Aussie, Kiwi Dollars Struggle On China’s Rate Cuts; Dollar Adrift
  • Oil Steadies, Weighed Down By Predicted Surplus Amid Weak Demand
  • Google Abandons Plan To Remove Cookies From Chrome Browser
  • WIZ Walks Away From $23 Billion Deal With Google, Will Pursue IPO
  • Buffett’s Berkshire Hathaway Drops BYD Stake To Less Than 5%
  • China Misses Plenum Chance To Steady Economy Before US Election
  • China Human Resources Ministry: China Added 6.98 Mln Urban New Jobs In H1
  • Japan And China Resume Strategic Dialogue After 4 Years
  • Japan’s Liberal Democratic Party Leader: BoJ Policies Should Be Made Clearer
  • Japan To Impose First Sanctions On Israeli Settlers In West Bank
  • SEC Approves Ether ETFs As Crypto Moves Closer To The Mainstream
  • (Sourced from Bloomberg, Reuters and other reliable financial news outlets)
     FX Options Expiries For 10am New York Cut (1BLN+ represent larger expiries, more magnetic when trading within daily ATR)

  • EUR/USD:1.0825-30(530M), 1.0875-85 (1.1BLN), 1.0900 (331M), 1.0955-60 (406M)
  • USD/CHF: 0.8900 (285M), 0.8955-60 (219M). EUR/CHF: 0.9650 (320M)
  • GBP/USD: 1.2950 (290M)
  • AUD/USD: 0.6750-60 (752M) . AUD/NZD: 10.75 (659M)
  • USD/CAD: 1.3695-1.3700 (385M), 1.3720-25 (356M), 1.3750 (219M)
  • USD/JPY: 155.85 (787M), 156.00 (236M), 157.00 (244M), 157.20-35 (1.6BLN)
     
  • CFTC Data As Of 16/7/24

  • Equity fund managers raise S&P 500 CME net long position by 19,908 contracts to 997,340
  • Equity fund speculators increase S&P 500 CME net short position by 28,517 contracts to 370,142
  • Japanese yen net short position is 151,072 contracts
  • British pound net long position is 132,902 contracts
  • Euro net long position is 24,749 contracts
  • Swiss franc posts net short position of -49,793 contracts
  • Bitcoin net short position is -579 contracts
     
  • Technical & Trade ViewsSP500 Bullish Above Bearish Below 5480

  • Daily VWAP bearish
  • Weekly VWAP bullish 
  • Below 5475 opens 5450
  • Primary support 5400
  • Primary objective is 5700
  • EURUSD Bullish Above Bearish Below 1.09

  • Daily VWAP bearish
  • Weekly VWAP bullish 
  • Above 1.880 opens 1.0940
  • Primary resistance 1.0981
  • Primary objective is 1.0750
  • GBPUSD Bullish Above Bearish Below 1.29

  • Daily VWAP bearish
  • Weekly VWAP bullish 
  • Below 1.2670 opens 1.2450
  • Primary support is 1.2690
  • Primary objective 1.3137/60
  • USDJPY Bullish Above Bearish Below 156

  • Daily VWAP bearish
  • Weekly VWAP bearish 
  • Below 156 opens 153
  • Primary support 152
  • Primary objective is 164
  • XAUUSD Bullish Above Bearish Below 2345

  • Daily VWAP bearish
  • Weekly VWAP bullish
  • Below 2400 opens 2330
  • Primary support 2300
  • Primary objective is 2598
  • BTCUSD Bullish Above Bearish below 62000

  • Daily VWAP bearish
  • Weekly VWAP bullish 
  • Above 67000 opens 70000
  • Primary support is 50000
  • Primary objective is 70000
  • More By This Author:FTSE Rebounds From Friday’s Lows As Rentokil Surges On Buyout Chatter
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    FTSE Closing The Week In The Red Amidst Global Tech Outage

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