Dollar, Gold Firmed As The War Goes On

STATE OF THE MARKETS

Dollar, gold firmed as the war goes on. US and European stocks sank further on Tuesday after Russian forces were reported to intensify attacks on Ukraine. FTSE (-1.72%), DAX (-3.85%) and Stoxx (-2.37%) were all in the red, followed by Dow (-1.76%), S&P (-1.55%), Nasdaq (-1.59%) and Russell (-1.93%).

Safe havens were the order of the day with Dollar piercing the 97.80 barrier while gold pierced the $1,950/oz minor handle. Bonds’ demand remains elevated, sending yields lower with the longer dated 10Y fell to 1.72% and the 30Y fell to 2.11%. The shorter 2Y fell to 1.33% and the 5Y to 1.57%.

In the commodities market, crude jumped past $105/bl after EIA issued an energy crisis warning on Russian sanctions. Following the lead, gold jumped to $1,945/oz as investors sought safe-haven safety after the Russian central bank retaliated by banning any sales in Russian assets. Elsewhere, iron ore found bids at $143.50/tn and managed to stabilize in the midst of the Russia-Ukraine conflict.

In the FX space, Aussie, Kiwi, Euro and Sterling were seen synching across all horizons signaling overbought in the commodity pairs as Europe and the UK rush to bids for more commodities in the event of energy and food crisis amid Russia-Ukraine conflict.

On Wednesday, markets look for earnings reports from Snowflakes (SNOW), Coupang (CPNG), Veeva System (VEEV), Abercrombie & Fitch (ANF), Dollar Tree (DLTR) and Splunk (SPLK) as well as the latest US ADP employment figures and mortgage applications index. The EIA petroleum status report will be in the spotlight for energy traders.

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OUR PICK – No New Pick

No new pick as we had three losses in a row. Losses are part of the game and we have to know when to stop. Given higher than usual volatility, maybe it’s a good time to stay on the sideline until after NFP Friday.

For high probability picks, please use our Trading Central services.

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This article is for general information purpose only. It is not an investment advice or a solicitation to buy or sell any securities/oz. Opinions expressed are of the authors and not necessarily of MFM Securities Limited or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.