US equities rally set to continue

US Equities Rally Set to Continue – The US stock market is expected to open higher today after closing lower yesterday. The S&P500 and Dow Jones were down, but the Nasdaq managed to rise by 0.15%. After the market closed, AI-related earnings boosted the positive momentum.

Micron Technology Inc., the largest US maker of computer memory chips, provided a strong revenue forecast for the current period, citing demand for artificial intelligence technology. The company stated that first-quarter sales are expected to be around $8.7 billion, surpassing the average analyst estimate of $8.32 billion. Profit is projected to be approximately $1.74 per share, excluding certain items, compared to a forecast of $1.52.

US data ahead

During the upcoming US session, we can expect the release of important economic data that is likely to have a significant impact on the markets. The biggest impact is expected to come tomorrow after the release of the Core PCE data, especially if it falls below expectations.

Today, all eyes are on the Jobless Claims following last week’s significant decline. We are looking to see if the data will be revised higher or remain unchanged. A substantial revision with another disappointing reading (higher) would reignite concerns about the labor market.

DXY remains solid above 100.65

The US Dollar Index has risen above the 100.65 level after stabilizing below that support for only one day. Reclaiming this support suggests the possibility of further gains ahead. However, a weekly close above that support is still needed to confirm a potential short-term retracement to the upside.

The Fed Funds Futures are currently pricing in a 75-basis-point rate cut between the next two meetings of the Federal Reserve. As long as these expectations remain steady, any upward movement in the Dollar Index is likely to be short-lived. The next resistance area is currently at 101.0, followed by 101.40. A break of the 100.65 level would open the way to retest this week’s low around 100.25.

Euro rejected at 1.12 Again

The EURUSD spiked above 1.12 during yesterday’s trading, reaching the highest level since July 2023 at 1.1215. However, the pair failed to stabilize and gave away all the daily gains, declining to as low as 1.1120 by the end of the US session.

This move comes after remarks from some ECB members who hinted that the ECB might need to continue with 25bps rate cuts in the coming meetings. However, the technical indicators remain bullish on most timeframes, and a weekly close remains crucial as we await another round of key economic releases from the US.

A weekly close above 1.12 would be a new bullish technical factor, paving the way for another leg higher, possibly towards 1.1275 later next week. Otherwise, the risk of another leg lower towards 1.1090 would be higher.

Silver steady above $32

Silver has made significant gains over the past few days, with an increase of over 5% since the beginning of the week. It has broken through multiple key resistance areas, leading to a more positive outlook on the daily chart.

Currently, Silver is holding steady above $32, which could potentially trigger another upward rally towards $32.30 and then $32.50, the highest level reached this year. If it breaks above this resistance, it could lead to further gains, reaching the highest level since 2013.

Crude oil not showing bullish signs yet

Brent Crude has been gradually rising, reaching $75.85 during yesterday’s trading. However, it lost all of yesterday’s gains during today’s European session, dropping as low as $73. The technical indicators do not yet show enough bullish momentum for a trend change. A weekly close above $75.85 is necessary to confirm such a change.

For now, the next support area is around $72.45. A break below that support could lead to further declines towards the $71.40 level.

Prepared by Nour Hammoury, Chief Market Analyst at SquaredFinancial
Nour is an investor, independent market strategist, and financial advisor. He holds a BA in Finance and Banking Science from Al-Ahliyya Amman University and a CFTe in Economics from the International Federation of Technical Analysts. He has more than 15 years of experience in forex, stocks, and global economic developments, as well as central bank policies and intermarket analysis. He appears regularly on major international TV networks, such as BBC, Al-Jazeera, Al Hurra, CNBC, and Bloomberg, holding open discussions and sharing insights and readings of the markets and trends.

Disclaimer
This is a marketing communication and does not contain, and should not be construed as containing, investment advice or an investment recommendation or, an offer of or solicitation for any transactions in financial instruments. Past performance is not a guarantee of or prediction of future performance. The information contained herein does not constitute a personal recommendation and does not consider your personal investment objectives, investment strategies, financial situation or needs. Squared Financial makes no representation and assumes no liability as to the accuracy or completeness of the information provided, or any loss arising from any investment based on a recommendation, forecast, or other information supplied by Squared Financial.

The information on this site is not intended for any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.