Berita & analisis pasar

Nvidia has been the star of the US markets since the AI hype kicked off late 2022. The trillion-dollar chip manufacturer’s shares have almost tripled in 2023 alone, with the price increasing every month so far this year. In May, Nvidia surprised the markets by posting earnings and revenue figures well above analysts’ expectations.

This sent price rocketing and adding almost $184B USD to the market cap during the following daily session. Nvidia is set to release their Q2 results on Wednesday, so the markets will be watching to see if they have been able to maintain the strong momentum over the past quarter. Markets are estimating earnings of $2.076B and revenue of $11.14B.

Technically, the price has been ranging sideways between $400-$480 since around June 2023. There is a strong support level around $400 that held multiple times in the past few months, so this will be a key level to hold if the earnings on Wednesday are below expectations. If earnings beat expectations, the price could head back north towards the resistance zone at about $470.

Traders will be watching this level to see if there is enough momentum to break through to all- time highs again. With the AI hype cooling off slightly over the past few months, it will be interesting to see how Nvidia performed over the past quarter and if the momentum was sustainable.

In 2022, it was believed that the Bank of Japan (BoJ) intervened three times, in September when the USDJPY was at 145.80, and in October and November when the USDJPY was at the 151.50 and 146.50 price levels respectively. For each of the 3 interventions, the USDJPY reversed strongly by more than 500pips. With the recent steady climb in the USDJPY in August, rising from 138 to the high of 146.50, there have been increasing comments from members of the BoJ and Japanese government regarding the need for an intervention.

The BoJ has avoided interventions, possible for the interim, by announcing increased flexibility on its yield-curve control (YCC). However, the markets viewed the action as insufficient and the stronger DXY continued to take the USDJPY higher. Continued upside on the USDJPY cannot be ruled out, especially if the DXY continues to strengthen significantly.

However, if the USDJPY continues to trade between the 145 and 146.50 price range, the possibility for an intervention from the BoJ increases. For an impactful intervention, the scale and timing of the decision would not be scheduled. A signal would be based on price volatility, in this case, if the USDJPY breaks through the bullish Ichimoku cloud and down from the 145-round number support level, which aligns with the 23.6% Fibonacci retracement level.

A reversal of 500 pips, similar to previous interventions, could see the USDJPY retest the trendline, along the 140 price level, with interim support at the 61.8% Fibonacci retracement and 141.60 price level.

USDJPY briefly pushed above 145 in today’s session before a sharp pullback, with traders wary of recent jawboning from Japanese officials regarding the “one sided” trade in the Yen may be setting the Japanese MoF up for another round on FX intervention that we saw late in 2022. Some sharp moves in the Yen in the last day have had traders speculating the MoF may have already intervened on a small scale but there was no official confirmation of intervention, MoF officials said they have no comment on the matter, but “they are mindful of the one-sided moves”. Looking at a close up of last years price action in the USDJPY may give traders a clue as to what to expect, with minor interventions seeing USDJPY spike lower, only to rise again until a major intervention or surprise policy change sustains a move lower in the cross rate.

This is a fairly predictable scenario from my experience with JPY interventions over the years. Any USDJPY traders would be wise to be familiar with the price action from these previous intervention efforts.

The USD/CAD pair experienced a relatively uneventful session after Bank of Canada (BoC) decided to keep interest rates on hold. However, what caught the attention of traders was the hawkish tone in the central bank's language. Similar to many central banks globally, the BoC is cautious about raising rates further until they thoroughly assess the inflation landscape.

Still, they've left the door open for potential rate hikes in the future. Surprisingly, this hawkish stance from the BoC didn't have a significant impact on the Canadian dollar against the US. The strength of the US dollar remained dominant, keeping the USD/CAD pair relatively flat during the session.

Currently, the pair finds itself at a crucial resistance level, which it has unsuccessfully attempted to breach three times since April. The BoC's hawkish language appears to have halted the pair's upward momentum, preventing a breakout, but wasn’t enough to push the pair south. Since mid-July, the USD/CAD pair has experienced an impressive 4% surge, driven by a resilient US dollar and the US Federal Reserve's commitment to maintaining higher interest rates to combat inflation.

However, from the technical view, a slightly bearish divergence is forming on the daily RSI, indicating the move might be running out of steam and a potential correction could be on the cards. In this high inflation environment, the pair's direction will likely hinge on crucial upcoming data releases in the weeks ahead. In addition to the technical setups, traders should keep a close watch on the fundamentals to help navigate potential shifts in direction.

The US Dollar Index (DXY) has closed its fourth consecutive day in the red, reaching levels last seen in early May 2023. Despite the recent decline, the DXY is coming into support around the 100 level, which has proven to be a resilient bounce point multiple times. However, each bounce appears to be getting smaller, which might indicate growing downward pressure.

This support level adds an interesting dynamic to the market as traders watch for potential price reaction. Todays US CPI print may hold the key to determining the DXY's future trajectory. If the CPI data is reported higher than expected, it could potentially fuel speculation of tighter monetary policy by the Federal Reserve.

In such a scenario, we might see the DXY experiencing a short-term rebound, as higher interest rates tend to attract investors seeking stronger returns. On the other hand, if the CPI data comes in lower than expected, market participants might interpret it as a sign that the US Federal Reserve will maintain its current pause in interest rate hikes during their upcoming FOMC meetings. If that occurs, it could potentially exert downward pressure on the US Dollar.

A more accommodative monetary policy stance may reduce the attractiveness of the USD to investors seeking higher yields, leading to a potential decline in its value against other currencies and potentially sending the DXY below 100 for the first time since early 2022. US CPI will be released at 08:30 EDT, YoY is expected to come in at 3.1%, with MoM expected at 0.3%

The current market consensus is that the Reserve Bank of New Zealand (RBNZ) would likely keep interest rates at 5.50% at the upcoming meeting on 12th July. This is supported by the RBNZ’s monetary statement indicating that “ monetary policy is having a sufficiently moderating effect on demand and inflation, and that we are yet to see the full effects of past tightening on the economy. A pause would also allow more time to assess the impact of the significant tightening, and the timing of any further increase that might be needed.” However, while the Consumer Price Index (CPI) has turned down from its peak of 7.3%, the most recent data was released at 6.7%, this is still significantly higher than the RBNZ’s target level of 1-3%.

Therefore, another rate hike from the RBNZ cannot be ruled out. In May, the RBNZ released its decision to hike rates to 5.50% but also indicated that the official cash rate has reached its peak at 5.50% but would need to remain at the restrictive level until at least the middle of 2024. This led to the NZDUSD falling steadily from 0.6250 to reach the round number support level of 0.60.

As the NZDUSD climbs toward the 0.6250 price area, formed by the previous swing high and the downward trendline, look for a potential reversal if the RBNZ holds interest rates at 5.50% as forecasted. A reversal to the downside could reach the price level of 0.61, supported by the upward trendline, and beyond that, the 0.60 round number key support level.