Daily Market Outlook, November 21, 2024 

Munnelly’s Macro Minute...

"Nvidia Dips As Bitcoin Rips”

Markets continue to express caution, with participants reluctant to take on significant risk. Asian markets are trading with a mix of gains and losses on Thursday, mirroring the mixed performance on Wall Street overnight. Traders are also keeping a close eye on the growing tensions between Russia and Ukraine, with wires reporting that Russia launched an intercontinental ballistic missile attack against Ukraine, targeting the city of Dnipro, early Thursday. The cautious market sentiment has also been influenced by the People's Bank of China's decision to maintain interest rates at their current level and the uncertainty surrounding the US Federal Reserve's future interest rate moves. The Japanese market is trading lower on Thursday, continuing the losses from the previous session. The Nikkei 225 is below the 38,100 level, with advances in banking firms offsetting declines in technology and index heavyweights.

Investors are also cautious due to the possibility of slower sales growth at AI powerhouse Nvidia. As investors process Nvidia's forecast of its slowest sales increase in seven quarters, the figures disappointed investors used to the AI darling surpassing all projections. Given Nvidia's pivotal role in the AI environment, which has fuelled the majority of the market gains in recent months, the forecast is expected to have an impact on suppliers as well as the larger markets. 

With the dollar index lingering around a one-year high reached last week, the dollar continues to lead the currency markets. Since Donald Trump's resounding victory earlier this month, the dollar has been rising as investors anticipate that his proposed tariffs will cause inflation and keep U.S. interest rates higher for an extended period of time. Bitcoin, which has increased by almost 40% in the two weeks since the election, is still the market outlier, as investors anticipate that the Trump administration will enact more lenient rules for the cryptocurrency industry. During Asian hours, the largest cryptocurrency reached a record high of $97,798 with $100,000 the principal near-term objective. For the day ahead, the macro slate is once again scant; events to monitor include the US Jobless Claims, Philly Fed Index, US Existing Home Sales, speeches by the Fed, SNB, ECB, RBA Governor, and BoE's Mann.

Overnight Newswire Updates of Note

  • Resurgent Inflationary Pressures Threaten BoE Dec Cut

  • Bitcoin Crosses $97K, Continuing Wild ‘Trump Trade’ Rally

  • Trump Seeks To Create New Crypto Position In White House

  • Chinese Managers Limited Flows To US Funds After Trump Victory

  • NHK: Japan’s PM Ishiba Set To Announce $140B Stimulus

  • NZ Treasury Sees Deeper Economic Downturn Pressuring Tax Take

  • Fed Governors Stake Out Competing Views Of Inflation Risk

  • Nvidia's AI Chip Demand Strong; Slowing Growth Worries

  • BofA Targets Regional Banks To Expand Risk Transfer Market

  • Boeing Gives Lay Off Notices To Nearly 700 In Missouri

  • Volkswagen Nears Walkouts As Union Talks Stall

          (Sourced from reliable financial news outlets)

FX Options Expiries For 10am New York Cut 

(1BLN+ represents larger expiries, more magnetic when trading within daily ATR)

  • EUR/USD: 1.0500 (2.8BLN), 1.0515 (1.9BLN), 1.0535-40 (1.6BLN)

  • 1.0550 (1.4BLN), 1.0600-10 (2.6BLN), 1.0650 (1.7BLN)

  • USD/CHF: 0.8850 (497M). EUR/CHF: 0.9350 (637M)

  • EUR/GBP: 0.8345-55 (493M), 0.8375-85 (693M)

  • GBP/USD: 1.2550 (360M), 1.2655 (281M), 1.2735-45 (683M)

  • AUD/USD: 0.6450 (2BLN), 0.6500 (591M).

  • NZD/USD: 0.5830 (347M), 0.5875 (528M). EUR/AUD: 1.6270 (400M)

  • USD/CAD: 1.4000 (1.3BLN), 1.4010 (380M), 1.4025 (824M), 1.4040 (358M)

  • USD/JPY: 153.50 (827M), 154.25 (420M), 155.80-85 (1.5BLN)

  • EUR/JPY: 162.85 (388M), 163.75 (305M)

  • AUD/JPY: 99.25 (780M), 100.40 (600M), 103.00 (1BLN)

CFTC Data As Of 15/11/24

  • Bitcoin net short position is -1,798 contracts

  • Swiss franc posts net short position of -32,694 contracts

  • British pound net long position is 56,050 contracts

  • Euro net short position is -7,437 contracts

  • Japanese yen net short position is -64,902 contracts

  • Equity fund managers raise S&P 500 CME net long position by 86,527 contracts to 1,079,480

  • Equity fund speculators increase S&P 500 CME net short position by 94,124 contracts to 288,809

  • Speculators trim CBOT US 2-year Treasury futures net short position by 62,488 contracts to 1,423,871

  • Speculators trim CBOT US 10-year Treasury futures net short position by 2,469 contracts to 815,801

Technical & Trade Views

SP500 Bullish Above Bearish Below 5960

  • Daily VWAP bullish

  • Weekly VWAP bullish

  • Below 5790 opens 5700

  • Primary support 5795

  • Primary objective 6100

EURUSD Bullish Above Bearish Below 1.0650

  • Daily VWAP bearish

  • Weekly VWAP bearish

  • Above 1.07 opens 1.08

  • Primary resistance 1.0950

  • Primary objective 1.0380

GBPUSD Bullish Above Bearish Below 1.2750

  • Daily VWAP bearish

  • Weekly VWAP bearish

  • Above 1.28 opens 1.30

  • Primary resistance 1.3050

  • Primary objective 1.25

USDJPY Bullish Above Bearish Below 154

  • Daily VWAP bullish

  • Weekly VWAP bullish

  • Below 154 opens 152

  • Primary support 148

  • Primary objective is 157.50

XAUUSD Bullish Above Bearish Below 2600

  • Daily VWAP bullish

  • Weekly VWAP bearish

  • Below 2590 opens 2530

  • Primary support 2530

  • Primary objective is 2800

BTCUSD Bullish Above Bearish Below 93000

  • Daily VWAP bullish

  • Weekly VWAP bullish

  • Below 92000 opens 87500

  • Primary support is 85000

  • Primary objective is 100,000