Trading Insights: Positive economic data bringing in “green shoots”
Market Talk
China PMI data blows past expectations in a positive signal for a change within the manufacturing sector
The Purchasing Managers' Index (PMI) is an index of the current direction of economic trends in manufacturing and service sectors of the economy
- Values above 50 indicate expansion, which is considered bullish for the respective economy
Source: National Bureau of Statistics of China
Cross-asset reaction
Risk on trade triggered as investors shift out of the safety of the USD and into risk assets such as the S&P Index
China A50 Index jumped higher after the positive PMI signal
USD/ZAR fell sharply
- The USD/ZAR is an emerging market FX pair
- When the USD falls against emerging market FX it is viewed as a signal that investors are feeling more confident about economic conditions and willing to take on more investment risk
Today’s Economic Events
US Crude Oil inventories expected to fall by 6,297 million barrels
- WTI crude oil has advanced +3.61% during the last 5 days. Price remains below the $77.90 resistance, a move above could trigger a further push higher
| Time: GMT+0 | Country/Region | Economic Indicator | Previous | Forecast | Actual | Units |
|---|---|---|---|---|---|---|
| 1:30:00 AM | China | Manufacturing PMI | 50.1 | 50.8 | 52.6 | - |
| 12:30:00 AM | Australia | GDP q/q | 0.6 | 0.7 | 0.5 | % |
| 9:30:00 AM | United Kingdom | Net Consumer Credit (BOE) | 0.8 | 0.5 | - | GBP |
| 1:00:00 PM | Germany | HICP (p) y/y (inflation) | 9.2 | 8.6 | - | % |
| 3:00:00 PM | US | Construction Spending m/m | -0.4 | 0.3 | - | % |
| 3:00:00 PM | US | ISM Manufacturing Index | 47.4 | 47.8 | - | - |
| 3:30:00 PM | US | Crude Oil Stocks ex. SPR w/w | 7.647 | 1.35 | - | bbl |
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Technical commentary
WTI Crude Oil price remains below its 50 day moving average (bearish); short term support is spotted near $73.80 (February 22 2023) low; resistance at $77.9 intersecting near the 50 day moving average suggests the $77.9 area is a key resistance zone, a break above could increase the prospects for a sharp upward price advance towards the $82.9 zone, however, current moving average analyst suggest that price remains bearish in the medium term (26-50 days)
Not investment advice. Past performance does not guarantee or predict future performance.
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