Trading Central--MORNING MARKET UPDATE

Market Wrap: Stocks, Bonds, Commodities.

On Thursday, all the three major U.S. stock indexes closed at record levels again, with the Dow Jones Industrial Average rising 242 points (+0.64%) to 38,049, the S&P 500 up 25 points (+0.53%) to 4,894, and the Nasdaq 100 up 17 points (+0.10%) to 17,516.

Energy (+2.23%), telecom services (+2.16%), and household & personal products (+2.09%) stock sectors were the top performers, while automobiles & components (-9.66%), health care equipment & services (-0.56%), and insurance (-0.33%) sectors lost the most.

Alphabet (GOOGL) advanced 2.13% to $151.87, a record close.

Microsoft (MSFT, +0.57%) and Nvidia (NVDA, +0.42%) also closed at record levels.

Tesla (TSLA) plunged 12.13% to $182.63, the lowest level since last May. The electric-vehicle maker posted lower-than-expected fourth-quarter results, and warned of lower vehicle volume growth in 2024. 

Boeing (BA) fell 5.72% after U.S. aviation authorities did not allow the plane-maker to expand production of its 737 MAX jet.

Humana (HUM) dropped 11.69%, as the health-insurance provider's 2024 earnings forecast missed expectations 

On the other hand, IBM (IBM) jumped 9.49% after giving an upbeat full-year revenue growth forecast and announced plans to cut jobs.

In after-market hours, Intel (INTC) sank 8% as the chip maker's first-quarter result guidance significantly fell short of market expectations. 

Meanwhile, the U.S. 10-year Treasury yield retreated 5.8 basis points to 4.120%. 

Regarding U.S. economic data, the gross domestic product grew at an impressive annualized rate of 3.3% on quarter in the fourth quarter (vs +2.3% expected). Durable goods orders showed no growth in December (vs +0.1% expected).

The latest number of initial jobless claims increased to 214,000 (vs 192,000 expected). New home sales climbed 8.0% on month in December (as expected).

European stocks closed higher, with the DAX 40 adding 0.10%, the CAC 40 up 0.11%, and the FTSE 100 up 0.03%.

U.S. WTI crude-oil rose $2.09 (+2.78%) to $77.18 a barrel. Oil prices were boosted by faster-than-expected U.S. economic growth and persistent tensions in the Red Sea.

Gold price gained $7 to $2,019 an ounce. 

Market Wrap: Forex

The U.S. dollar was firm against other major currencies, as upbeat U.S. economy growth suggested the Federal Reserve would not cut interest rates very soon. The dollar index climbed to 103.51.

EUR/USD fell 40 pips to 1.0843. As expected, the European Central Bank (ECB) decided to keep its key interest rates unchanged at 4.00%. ECB President Christine Lagarde said it was premature to discuss rate cuts.

Germany's Ifo business climate index declined to 85.2 in January (vs 87.1 expected). France's business confidence index remained stable at 99 in January (as expected).

USD/JPY gained 18 pips to 147.68. This morning, Japan's data showed that Tokyo's core inflation rate slowed to 1.6% on year in January (vs 1.9% expected).

GBP/USD slipped 14 pips to 1.2709, while AUD/USD added 7 pips to 0.6583.

USD/CHF rose 45 pips to 0.8672.

USD/CAD dropped 53 pips to 1.3469. Canada's data showed that manufacturing sales dropped 0.6% on month in December (vs +0.4% expected).

Bitcoin continued to dance around the key level of $40,000. 

GBP/USD Intraday: expect 1.2660.

Pivot:

1.2735

Our preference:

Short positions below 1.2735 with targets at 1.2680 & 1.2660 in extension.

Alternative scenario:

Above 1.2735 look for further upside with 1.2755 & 1.2775 as targets.

Comment:

A break below 1.2680 would trigger a drop towards 1.2660.

USD/JPY Intraday: bullish bias above 147.15.

Pivot:

147.15

Our preference:

Long positions above 147.15 with targets at 147.90 & 148.25 in extension.

Alternative scenario:

Below 147.15 look for further downside with 146.90 & 146.65 as targets.

Comment:

Even though a continuation of the consolidation cannot be ruled out, its extent should be limited.

EUR/USD Intraday: the downside prevails.

Pivot:

1.0870

Our preference:

Short positions below 1.0870 with targets at 1.0820 & 1.0800 in extension.

Alternative scenario:

Above 1.0870 look for further upside with 1.0885 & 1.0900 as targets.

Comment:

The RSI advocates for further downside.

Crude Oil (WTI)‎ (H4)‎ Intraday: the bias remains bullish.

Pivot:

76.30

Our preference:

Long positions above 76.30 with targets at 77.50 & 78.10 in extension.

Alternative scenario:

Below 76.30 look for further downside with 75.75 & 74.85 as targets.

Comment:

The RSI is mixed with a bullish bias.

Gold Intraday: intraday support around 2011.00.

Pivot:

2011.00

Our preference:

Long positions above 2011.00 with targets at 2029.00 & 2037.00 in extension.

Alternative scenario:

Below 2011.00 look for further downside with 2004.00 & 1998.00 as targets.

Comment:

Technically the RSI is above its neutrality area at 50.

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