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08.02.202314:48 Forex Analysis & Reviews: US premarket on February 8: investors again did not believe Jerome Powell

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Following yesterday's spike in volatility, which made many traders nervous, futures on US market indices are currently trading slightly lower. Investors remain optimistic about what is happening and think that inflation will return to normal in the near future and that the need for strict laws will go away on its own, despite the chairman of the Federal Reserve System's assertions to the contrary.

Exchange Rates 08.02.2023 analysis

Futures for the Nasdaq 100 and S&P 500 are currently down 0.3% and 0.2%, respectively, while the Dow Jones industrial average has dropped roughly 0.2%. While oil and gas company Equinor ASA and lender ABN Amro NV reported quite strong profits in their quarterly reports, the European Stoxx Europe 600 index increased. Despite the seriousness of the US labor market figures, Fed Chairman Jerome Powell indicated merely that before the Federal Reserve adopts a wait-and-see approach, borrowing costs may likely hit a higher maximum than traders anticipate. Powell responded to questions from the audience at the Economic Club of Washington by saying, "We think we may need to hike rates further." "The labor market is remarkably strong. If the situation there remains tight, we may have to take additional action beyond what was originally anticipated," he said. However, as you can see on the chart when the S&P 500 index had a strong decline, the entire movement was bought out because Powell made no specific statements regarding the required policy change.

Today's gains in Australia and South Korea more than made up for China's stock lag in the Asian indices, which also increased. The dollar index and Treasury bond yields both modestly decreased.

Some people think Powell's last hawkish speech went unheard, and there is some truth to this. Investors are now focusing on the less expensive assets, as well as the fact that the Fed is no longer acting as aggressively as it once did. Powell broke his December commitment to increase rates by 50 basis points, and the committee will maintain its dovish stance.

Adani Enterprises, which has endured much, saw its shares increase for a second day after collapsing as a result of the harsh critique of Hindenburg Research that was released two weeks ago.

Oil prices rose in other markets after experiencing their greatest one-day increase since November, supported by a rebound in Chinese demand.

Exchange Rates 08.02.2023 analysis

Regarding the S&P 500's technical picture, it is evident that there is still a demand for riskier assets. The index could increase further, but consolidation over $4,150 is required for this. The control of $4,180, which will enable the bullish trend to continue, will be no less of a priority for the bulls. After that, we can anticipate an upward movement that is more confident, to support the trading instrument at $4,208. The level of $4,229 is a little higher and will be challenging to surpass. Buyers only need to declare themselves in the area of $4,116 in the event of a downward movement and lack of demand. When it breaks down, the trading instrument will be immediately pushed to $4,090 and open the way to $4,064.

Desarrollado por un Jakub Novak
experto de análisis de InstaForex
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