Good morning and welcome to episode 803 of ‘Talking Bull’. Here are the latest headlines today, US Jobless claims increase, Wall Street equities slide, US yields decline, Lower yields sap dollar support, Bank of Japan on hold, UK GDP better than expected, Key US jobs report Friday & Canadian jobs data also due.
We take a technical look at key markets that are likely to be impacted by today’s events. Also, we participate in a ‘Gun to the head’ challenge where each of us calls a live trade. These will expire at 9pm tonight and we will keep track of the progress over time.
We hope you enjoy it!
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Joe was stopped out on EURNZD. Steve was onside 1.09R on EU50.
We have included an illustration based on a £1000 account. This will follow the combined return of our morning trades by risking 1% of the trading capital per trade. The 1% risk is a variable monetary amount and will rise and fall based on the success of the calls.
We are currently up 191 .18% collectively since we began recording Talking Bull on the 30th October 2019.
US Jobless claims increase
US initial jobless claims increased to 211,000 in the latest week from 190,000 previously which was above consensus forecasts of 195,000 and the highest reading since late 2022. Continuing claims also increased to 1.72mn from a revised 1.65mn and equalled the highest figure since early 2022.
Challenger job cuts declined to just below 78,000 for February from just below 103,000 the previous month, but this was still a substantial increase from the level near 15,000 last year. For the first two months of 2023, the number of layoffs was the highest since 2009.
Wall Street equities slide
Wall Street equities posted gains in early trading, but there was a rapid change in mood later in the session.
The Silvergate collapse and fears over wider losses in the loan portfolios triggered a slide in the banking sector.
Contagion fears led to a 1.85% decline in the S&P 500 index.
US yields decline
The slide in equities triggered defensive bond buying and there was also evidence of stop-loss buying.
The 2-year yield dipped below 5.00% and the 10-year yield dipped sharply to near 3.80%.
Lower yields sap dollar support
Lower bond yields tended to undermine the dollar despite potential demand on defensive grounds.
There was notable demand for the Swiss franc during the day.
Bank of Japan on hold
The Bank of Japan held monetary policy unchanged at the latest policy meeting with yields at -0.1% and a 1.0% cap for the 10-year bond yield.
This was the final meeting for Governor Kuroda which had led to some speculation over a change.
The yen posted sharp losses after the decision.
UK GDP better than expected
UK data recorded a 0.3% GDP increase for January compared with expectations of a 0.1% increase with a rebound n services offset by a dip in manufacturing and construction output.
Key US jobs report Friday
The latest US employment report will be very important for Federal Reserve expectations and dollar moves on Friday.
After last month’s surge in non-farm payrolls of over 500,000, consensus forecasts are for an increase of around 220,000 with the unemployment rate holding at 3.4% and an increase in average hourly earnings of 0.3%.
Canadian jobs data also due
The latest Canadian labour-market report is also due on Friday.
Consensus forecasts are for an employment increase of 10,000 after the 150,000 surge the previous month with unemployment edging higher to 5.1% from 5.0%.
13.30: US employment report
13.30: Canada employment report
Key events over the next week
March 14th: US consumer prices
March 15th: UK budget statement
March 16th: ECB policy decision
Gun to head challenge – Update
Today’s trade idea
Have a great week everyone.
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