At the resistance level, the instrument has formed a Shooting Star reversal pattern. Currently, the pair may go by the signal in a yet another correction wave. The goal of the pullback will be 1745.00. After a test of the support level, gold may bounce off it and continue the uptrend. However, the quotes may grow to 1795.50 skipping the reversal signal altogether.
NZDUSD, “New Zealand Dollar vs US Dollar”
On H4, at the resistance level, the pair has formed a reversal pattern Shooting Star. Currently, the pair may go by the signal in a descending wave. The goal of the correction will be 0.6010. After a bounce off the support level, the quotes will get a chance to continue the uptrend. However, they may grow to 0.6180 without any pullback.
GBPUSD, “Great Britain Pound vs US Dollar”
On H4, at the resistance level, the pair has formed a Shooting Star reversal pattern. Currently, the pair will go by the signal in a descending wave. The goal of the correction might be the support level of 1.1690. In case the price bounced off it, it will get a chance to continue the uptrend. However, the price may grow to 1.1935 without any correction to the support.
Attention! Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.
With late-stage drug candidates and major near-term catalysts, undervalued Aldeyra Therapeutics warrants a Buy to Outperform rating and consideration by potential investors, according to various analysts.
For a biopharma with one new drug candidate on the verge of potential approval in the U.S. and a second close behind, Aldeyra Therapeutics Inc.(ALDX:NASDAQ) is currently undervalued and represents an attractive, derisked investment opportunity, experts said.
The Massachusetts-based firm develops treatments for immune-mediated diseases, which regulate entire immunological systems rather than alter a single protein. The therapeutic candidates are designed to optimize numerous pathways while limiting toxicity, and the biopharma is currently advancing three such products.
A Trio of Potential New Therapies
1) Reproxalap: This RASP, or reactive aldehyde species, inhibiting 0.25% ophthalmic solution for dry eye disease is Aldeyra’s lead drug candidate, for which the company is on schedule to file a new drug application (NDA) with the U.S. Food and Drug Administration (FDA) by year-end.
Approval “could lead to a meaningful lift for the shares,” purported Oppenheimer analyst Justin Kim.
In clinical trials, reproxalap was shown to be efficacious and safe. It “demonstrated robust and consistent dry eye disease benefit,” wrote H.C. Wainwright & Co. analyst Matthew Caufield in a July 13 research note. “We view RASP inhibition as presenting a viable novel pathway in addressing current dry eye disease therapeutic limitations.”
Caulfield noted that approved dry eye disease treatments on the market could take months to have an appreciable effect, have inconsistent responses among patients, and can be uncomfortable, often causing patients to stop using them. RASP is different as it is said to provide immediate relief, unlike previous therapies.
“From an FDA perspective, reproxalap is very safe, passes the Schirmer test with high significance, and has a novel mechanism of action in a field with underserved patients. We think that will be enough for approval,” said BTIG’s Thomas Shrader.
Laidlaw & Co. analyst Dr. Yale Jen stated, “Although ALDX could launch reproxalap by themselves, we believe this is a highly desirable product for large pharma companies, especially those that could leverage their existing or start an ophthalmology sales force.”
BTIG’s Thomas Shrader is one of several analysts who remain bullish on reproxalap’s chances of approval for dry eye disease. In a June 8, 2022 research report, he wrote, “From an FDA perspective, reproxalap is very safe, passes the Schirmer test with high significance, and has a novel mechanism of action in a field with underserved patients. We think that will be enough for approval.”
Newsletter writer Clive Maund said, in a November 1st posting, “Action since this candle looks like a tiny bull Flag suggesting renewed advance soon. Buyers here should place a stop below US$5.00.”
Reproxalap is also being evaluated for allergic conjunctivitis and is now in Phase 3.
2) ADX-2191: This intravitreal methotrexate injection is a Phase 2 developmental treatment for retinitis pigmentosa and primary vitreoretinal lymphoma. For the latter, Aldeyra has a pre-NDA meeting scheduled with the FDA this quarter.
Aldeyra intends for ADX-2191 to also prevent proliferative vitreoretinopathy (in Phase 3). Topline Phase 3 GUARD trial results suggest ADX-2191 treatment could be safer and more effective in this indication than compounded methotrexate, wrote Dr. Yale Jen, a Laidlaw & Co. analyst, in an Oct. 6, 2022 research note.
Jen also noted the current clinical package for ADX-2191 in proliferative vitreoretinopathy is “strong” and likely to support an NDA. To delineate the regulatory pathway forward for this, Aldeyra is scheduling a Type C meeting with the FDA for H1/23.
3) ADX-629. This orally administered RASP modulator is in Phase 2 clinical testing for the treatment of four immune-mediated diseases: ethanol toxicity, chronic cough, Sjögren-Larsson Syndrome, and minimal change disease.
Implications of Near-Term Catalysts
Because dry eye disease is a large, currently underserved market, FDA approval of reproxalap as a treatment for it would be a significant development for Aldeyra, BTIG analyst Shrader wrote.
Approval “could lead to a meaningful lift for the shares,” purported analyst Justin Kim in a Sept. 15 research report. His firm Oppenheimer rates Aldeyra Outperform.
Were reproxalap approved, Aldeyra could reach commercialization in 2023.
As for Aldeyra’s shares, they are currently “underexposed and undervalued,” according to Laidlaw‘s Dr. Yale Jen.
With respect to ADX-2191, positive GUARD trial results, and the pre-NDA meeting on primary vitreoretinal lymphoma, Kim noted, “could catalyze a nontrivial revenue opportunity relative to current share levels.”
As for Aldeyra’s shares, they are currently “underexposed and undervalued,” according to analyst Jen. Today Aldeyra’s share price is US$5.32, and it has been trading in the US$5 range since Sept. 20, 2022.
In comparison, Jen’s firm, Laidlaw & Co., has a US$30 per share target price on the biopharma; this represents a significant jump and return on investment from its share price today.
While Aldeyra’s cash position declined in the latest quarter, Jen noted in a November 11 research note that “ALDX ended 3Q22 with ~US$185M cash, enough to support its operations throughout 2023.” In the report, Laidlaw & Co. reiterated its Buy rating and said, “ALDX shares remain underexposed and under-valued.”
Institutions Dominate Ownership
Institutions held 68.43% of Aldeyra’s shares, the Top 3 being Perceptive Advisors LLC (16.98%), The Vanguard Group Inc. (4.18%), and Citadel Advisors LLC (3.97%). The No. 1 mutual fund holder was the Vanguard Total Stock Market Index Fund at 2.74%.
Aldeyra insiders, including Chief Executive Officer Dr. Todd Brady, Chief Development Officer Dr. Stephen Machatha, Chairman of the Board Dr. Richard Douglas, and several directors, together owned 2.36% of the company’s shares.
The Aldeyra investment opportunity is one that numerous biotech research analysts view favorably. As of them, Kim wrote, “Aldeyra’s late-stage ophthalmology pipeline in allergic conjunctivitis and dry eye diseases offers a favorable risk-reward to current share levels, coupled with long-term pipeline optionality from ADX-2191 in proliferative vitreoretinopathy and systemic RASP applications.”
Coverage and Share Structure
Aldeyra is followed by numerous analysts, including Wainwright & Co. analyst Matthew Caufield, BTIG’s Thomas Shrader, Dr. Yale Jen of Laidlaw & Co., and Justin Kim of Oppenheimer. Newsletter writer Clive Maund also follows the stock. Click “See More Live Data” in the data box above to read their reports.
Aldeyra Therapeutics’ market cap is US$320.78M. The company has 58.32 million shares outstanding, and it trades in a 52-week range of US$2.36 and US$9.06.
Disclosures: 1) Doresa Banning compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an independent contractor. She or members of her household own securities of the following companies mentioned in the article: None. She or members of her household are paid by the following companies mentioned in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: None. Click here for important disclosures about sponsor fees. As of the date of this article, an affiliate of Streetwise Reports has a consulting relationship with None. Please click here for more information.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
4) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Aldeyra Therapeutics Inc., a company mentioned in this article.
6) This article does not constitute medical advice. Officers, employees and contributors to Streetwise Reports are not licensed medical professionals. Readers should always contact their healthcare professionals for medical advice.
On Monday, the BTC is balancing near 16,746 USD. The morning session was much more complicated than expected, with a noticeable decline and sales.
Losses of the BTC over the week exceeded 20%. The crucial reason for the sales, as you remember, is the story with Binance and FXT.
At the market, they are actively discussing the version that the tweets and publications against FXT were not without a purpose. Binance washed off the rival virtually overnight. We will see what regulators will do. However, trust to crypto has dropped noticeably. The market swiftly recalled the story with Terra and Luna, which was a costly and painful experience.
The range of strong supports for the BTC has moved to 15,550-18,200 USD. Risks of falling to 12,000-12,500 USD are growing too fast.
Capitalisation of the crypto market is now estimated as 840.77 billion USD, the BTC taking up 38.3% and the ETH – 18.3%.
Withdrawal of the BTC was the largest – Glassnode
Glassnode watchers say that with all the volatility, withdrawal of the BTC from crypto exchanges turned out almost at the all-time peak of 106,000 BTC a month. The leading crypto has already faced a similar situations three times.
UAE schools will teach the basics of blockchain and the metaverse
Educational institutions at the UAE are introducing new lessons on blockchain, the metaverse, and cryptocurrencies. They say that the virtual reality is developing fast, so these new lessons will prepare schoolchildren for the labour market of the future.
Attention! Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.
Dollar weakness on Friday continued Thursday’s move after US Consumer Inflation fell to an annualized 7.7% in October, the lowest since the beginning of the year. This strengthens the argument that the Federal Reserve will reduce the pace of interest rate hikes. But reducing the rate of increase is not “easing,” with the difference in interest rates between the ECB and the US Fed remaining substantial. According to analysts, the technical correction is coming to an end, and the dollar will once again find a new buying interest soon.
Trading recommendations
Support levels: 1.0194, 1.0092, 1.0043, 0.9993, 0.9838, 0.9794, 0.9755
Resistance levels: 1.0363, 1.0411, 1.0504
From the technical point of view, the trend on the EUR/USD currency pair on the hourly time frame is bullish. The price is trading above the moving averages, and the MACD indicator is in the positive zone, but the price has deviated strongly from the averages. For buy deals, it is best to wait for a corrective movement to the support levels of 1.0194 or 1.0092, but with additional confirmation. Sell deals can be considered from the resistance level of 1.0363, but it’s better with confirmation in the form of a reverse initiative.
Alternative scenario: if the price breaks down through the support level of 0.9993 and fixes below it, the downtrend will likely resume.
News feed for 2022.11.14:
– Eurozone Industrial Production (m/m) at 12:00 (GMT+2);
– US FOMC Member Brainard Speaks at 18:30 (GMT+2).
The GBP/USD currency pair
Technical indicators of the currency pair:
Prev Open: 1.1704
Prev Close: 1.1832
% chg. over the last day: +1.01 %
UK GDP fell sharply by 0.6% in the third quarter (against expectations of 0.1%). Analysts predict that this is the beginning of a recession for the UK and expect GDP to fall 2% by summer 2023. However, much depends on how the government’s energy support develops during this period. As winter approaches, analysts expect tensions between the manufacturing, construction, and industrial sectors to increase. But much will depend on Thursday’s budget announcement this week. The focus will be on how the chancellor closes the projected budget deficit in 2026/27 and how the government will make its energy support more targeted to make policy less costly.
Trading recommendations
Support levels: 1.1684, 1.1476, 1.1418, 1.1231, 1.1172, 1.1093, 1.0915, 1.0817
Resistance levels: 1.1848, 1.1901
From the technical point of view, the GBP/USD currency pair trend on the hourly time frame is bullish. The price is trading above the moving averages. The MACD indicator is in the positive zone, but the first signs of divergence have appeared. Under such market conditions, it is better to look for buy deals after a slight correction to the support levels of 1.1684 or 1.1476. It is best to look for sell deals from the resistance level of 1.1848, but better with a confirmation in the form of a reverse initiative.
Alternative scenario: if the price breaks down from the 1.1418 support level and fixes below it, the downtrend will likely resume.
There is no news feed for today.
The USD/JPY currency pair
Technical indicators of the currency pair:
Prev Open: 140.96
Prev Close: 138.76
% chg. over the last day: -1.58 %
The Bank of Japan should revise its inflation target and gradually abandon negative rates and radical yield restriction policies to reduce the rising cost of prolonged monetary policy easing, said Yuri Okina, a key government commissioner and possible future BOJ governor. Mrs. Okina also added that the Bank of Japan should steer a course toward policy normalization over the long term. With Consumer Prices forecast to rise later this week, the Bank of Japan is getting closer to abandoning its soft monetary policy. But the situation will likely remain the same until the end of the year.
Trading recommendations
Support levels: 138.78, 137.65, 136.80
Resistance levels: 138.78, 137.65, 136.80
From the technical point of view, the medium-term trend on the currency pair USD/JPY is bearish. The price is trading below the moving averages. The MACD indicator is deeply negative, and there are signs of overselling and divergence, which shows the weakness of sellers. Under such market conditions, buy trades can be sought on intraday time frames from the support level of 138.78, but only with a confirmation in the form of a false breakdown. Sell deals can be searched from the resistance level of 140.55, but only with additional confirmation.
Alternative scenario: If the price fixes above 146.06, the uptrend will likely resume.
There is no news feed for today.
The USD/CAD currency pair
Technical indicators of the currency pair:
Prev Open: 1.3320
Prev Close: 1.3252
% chg. over the last day: -0.51 %
The Canadian dollar is a commodity currency and depends on factors such as the monetary policy of the Bank of Canada, the performance of the dollar index, and the oil price movement. Oil prices rose nearly 1% on Monday, continuing Friday’s gains as China eased some of its strict COVID-19 restrictions, raising hopes for a rebound in economic activity and demand from the world’s largest oil importer. Rising oil prices tend to strengthen the Canadian currency.
From the point of view of technical analysis, the trend on the USD/CAD currency pair is bearish. The MACD indicator is in the negative zone, but there is a divergence, and the price is in front of the support level. The best way to sell is to consider the resistance level of 1.3369. Still, there is a lot of space before this level, so buy trades are very appropriate and should be considered on the lower time frames from the support level of 1.3212, but with an additional confirmation in the form of a reverse initiative.
Alternative scenario: if the price breaks out and consolidates above the resistance level of 1.3607, the uptrend will likely resume.
This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.
Nova Scotia-based nanotech company Meta Materials Inc. reports a major revenue increase just as it signs an agreement to help reduce the cost and weight of batteries for electric vehicles, extend their range, and improve their safety.
Analyst MacMurray Whale of Cormark Securities maintained a Buy rating on the stock.
Total revenue grew YOY in Q3 by 329% to US$2.5 million and 388% to US$8.8 million over the first nine months versus the same period in 2021.
PLASMAfusion lab-scale tool. Source: Meta Materials Inc.
Analyst MacMurray Whale of Cormark Securities wrote in an updated note on Friday that the revenue increase was less than the US$3.4 million Cormark had predicted. However, he maintained a Buy rating on the stock, lowering the target to US$3.50 from US$5.
“We had expected indications of a more rapid ramp in volumes than we previously modeled but recognize the difficulty to model given the rapid changes in the EV space,” Whale wrote. “With the cash balance having declined to (US$31 million), the current quarterly spend gives a shorter runway than we had expected exiting the year.”
The company’s Q3 net loss increased to US$24.5 million, or 7 cents per share, on 362.2 million weighted average shares, compared to US$11.4 million, or 4 cents per share, on 280 million weighted average shares in Q3 2021.
But operating expenses also doubled YOY to US$23.9 million following several important acquisitions, the analyst pointed out.
“MMAT has many early-stage projects across a number of different verticals, most of which have not entered into commercial-scale production,” Whale stated.
The Catalyst
The largest part of the revenue increase was US$1.9 million from a deal with a confidential G10 central bank customer to develop anti-counterfeiting measures for currency, Whale said.
It’s part of an agreement with the bank for a maximum of US$41.5 million in development work over up to five years.
Metamaterials were first developed in the 1960s but only came into their own in the 2000s, when design and manufacturing capabilities caught up to the technology. The company is using them to develop nanotechnology products like self-deicing and defogging car and truck headlights and windows, see-through antennas, augmented reality glasses that look like regular glasses, and special eyewear that protects pilots’ eyes from laser strikes.
META is applying its futuristic technology to the communications, health and wellness, aerospace, automotive, and clean energy sectors.
The company has 472 active patent documents, of which 292 patents have been granted across all its technologies.
Big Strides in EV Battery Tech
Earlier this month, META announced it had entered a memo of understanding with DuPont Teijin Films and Mitsubishi Electric Europe to use Meta’s PLASMAfusion to scale a high-volume manufacturing system for film-based, coated copper current collectors.
The process reduces the amount of the red metal needed for EV batteries at a time when an upcoming copper shortage is threatening the transition to green energy, the company said.
“There has to be a better way,” META President, Chief Executive Officer, and founder George Palikaras said. “What we’re proposing here, and that’s part of the disruption, is that we have not only invented a way to make current collectors more efficient by reducing the copper content, but we have made an actual machine which we call PLASMAfusion.”
The agreement is focused on developing battery materials, such as coated copper current collectors and solid-state battery electrodes, META said. It will start with a pilot program and evolve into an industrial-scale mass production line.
META will provide the PLASMAfusion technology, DuPont Teijin Films will develop and supply polyester substrates, and Mitsubishi Electric Europe will contribute automation technology, expertise, and interface with machine builders.
“What’s very important here (is that) PLASMAfusion is very versatile,” Palikaras said. “It’s a platform technology with which we expect to increase productivity not only for batteries but also for nanoweb and other applications.”
Security Tech Set to Launch
The award from the G10 bank is part of an ongoing contract; META could not identify the bank for security reasons. But the company did say it was to work on the currency.
In addition to the US$4.3 million just announced, the bank already awarded the company a total of US$9.2 million.
The company said it is currently testing its anti-counterfeiting technology KolourOptik® Stripe and expects to launch it as early as the first quarter of 2023.
A blog on META’s site describes some of the security measures available through the technology, including images with omnidirectional movement, 3D depth, or holographic security patterns.
Those effects are “the exact visual triggers that millions of years of evolution have optimized human visual receptors to detect and respond to,” the company said. “Our toolkit of innovative nano-optic based visual effects to combat counterfeiting is available to brands and designers that are looking to build . . . extremely secure, custom solutions that (work) well with their brand.”
META also offers the technology for use on documents, smart packaging, and gift cards. The technology can also help prevent loss of life due to counterfeit medication.
Ownership, Coverage, and Share Structure
META had cash and cash equivalents of US$32.2 million in the third quarter and a burn rate of about US$6.5 million per month.
Major shareholders include Thomas Gordon Welch, with 6.64% or 24 million shares; Anne Barber Lambert, with 6.39% or 23.14 million shares; Lamda Guard Technologies Ltd., with 6.35% or 22.98 million shares; and State Street Global Advisors, with 3.54% or 12.82 million shares, according to Reuters. About 14% of META is held institutionally held.
The stock is covered by numerous analysts, including SingularResearch’s Christopher J. Sakai, ROTH Capital Partners’ Gerry Sweeney, as well as Cormark Securities’MacMurray Whale, and newsletter writer Clive Maund of Clivemaund.com. Click “See More Live Data” in the data box above to review more.
The company has a market cap of $473.6 million with 361.9 million shares outstanding, 267 million of them free-floating. It trades in a 52-week range of US$5.42 and US$0.63.
Disclosures: 1) Steve Sobek wrote this article for Streetwise Reports LLC. He or members of his household own securities of the following companies mentioned in the article: None. He or members of his household are paid by the following companies mentioned in this article: None. His/her company has a financial relationship with the following companies referred to in this article: None.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: Meta Materials Inc. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
4) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the decision to publish an article until three business days after the publication of the article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of Meta Materials Inc., a company mentioned in this article.
At the closing of the stock market on Friday, Dow Jones (US30) gained 0.09% (+3.99% for the week), and S&P 500 (US500) added 0.92% (+5.61% for the week). Technology Index NASDAQ (US100) increased by 1.88% on Friday (+7.67% for the week). However, despite the indices’ growth, analysts keep decreasing the forecasts of the US companies’ financial results and now expect negative growth of the “blue chips” total earnings in the 4th quarter. So far, 91% of the S&P 500 companies have already reported. 69% reported higher-than-expected actual earnings per share, below the average of 77%.
The US Federal Reserve may consider slowing the rate hikes at its next meeting. Still, Federal Reserve Chairman Christopher Waller said Sunday that it should not be seen as “easing” its commitment to lower inflation. According to analysts, markets should now pay attention to the end point of rate hikes rather than the pace of each move.
The midterm elections in the US indicate that the Democrats retain control of the Senate. They now have 50 seats against 49 for Republicans. Democratic leaders in Congress on Sunday promised to tackle the national debt ceiling in the coming weeks, saying their party’s election victory gives them leverage. The US House Speaker Nancy Pelosi and US Senate Majority Leader Chuck Schumer said they would act as long as Democrats control both houses.
Stock markets in Europe traded mixed last week. German DAX (DE30) gained 0.56% (+6.17% for the week), French CAC 40 (FR40) added 0.58% (+3.37% for the week), Spanish IBEX 35 (ES35) decreased by 0.43% (+2.34% for the week), British FTSE 100 (UK100) closed on Friday down by 0.78% (-0.23% for the week).
Germany’s inflation rate rose from 10% to 10.4% year-over-year, the highest since Germany’s reunification. Huge increases in energy prices continue to be the main cause of high inflation. In addition to rising prices for all types of energy due to the war in Ukraine and the energy crisis in Europe, supply disruptions and significant price increases in the preceding stages of the economic process are also affecting the inflation rate.
UK GDP fell sharply by 0.6% in the third quarter (with expectations of -0.1%). Analysts predict that this is the beginning of a recession for the UK and expect GDP to fall 2% by summer. However, much depends on how the government’s energy support develops during this period. As winter approaches, analysts expect more problems in manufacturing, construction, and industrial issues. But much will depend on Thursday’s budget announcement this week.
The EU Commission predicts that Eurozone quarterly GDP will contract in the fourth quarter of 2022 and the first quarter of 2023. As for consumer prices, the European Commission believes that inflation in the Eurozone will begin to decline next year, reaching an annualized rate of 7.0%.
Oil prices rose nearly 1% on Monday, continuing Friday’s gains as China eased some of its strict COVID-19 restrictions, raising hopes for a rebound in economic activity and demand from the world’s largest oil importer.
Asian markets mostly rose last week. Japan’s Nikkei 225 (JP225) gained 3.25% over the week, Hong Kong’s Hang Seng (HK50) jumped by 8.07%, and Australia’s S&P/ASX 200 (AU200) was up by 3.85%.
Annual Core Consumer Inflation surpassed the Bank of Japan’s target of 2% for the sixth straight month as the weak yen, partly driven by the central bank’s low-interest rate policy, pushed up import prices and household living costs. Bank of Japan Governor Haruhiko Kuroda has repeatedly said that the central bank should refrain from adjusting the YCC until its 2% inflation target is sustainably achieved and accompanied by wage increases. According to a key government commission spokesman, the Bank of Japan should steer a course toward policy normalization over the long term.
In the commodities market, futures on palladium (+11.28%), cocoa (+9.38%), platinum (+8.66%), copper (+6.77%), gold (+5.82%), silver (+4.86%), and sugar (+4.7%) showed the biggest gains by the end of the week. Futures on natural gas (-7.78%), orange juice (-5.42%), WTI oil (-4.05%), wheat (-4.01%), coffee (-3.98%), gasoline (-3.86%), corn (-3.45%), and Brent oil (-2.85%) showed the biggest drop.
S&P 500 (F) (US500) 3,992.93 +36.56 (+0.92%)
Dow Jones (US30) 33,747.86 +32.49 (+0.096%)
DAX (DE40) 14,224.86 +78.77 (+0.56%)
FTSE 100 (UK100) 7,318.04 −57.30 (−0.78%)
USD Index 106.42 −1.79 (−1.65%)
Important events for today:
– Eurozone Industrial Production (m/m) at 12:00 (GMT+2);
– Switzerland SNB Chairman Thomas Jordan speaks at 18:30 (GMT+2);
– US FOMC Member Brainard Speaks at 18:30 (GMT+2).
This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.
As the prices of oil stocks are running ahead of oil prices, expert Clive Maund reviews the 7-month, 3-year, and 20-year charts of the oil index to tell you where he believes the commodity is headed.
A key point to bear in mind with respect to the outlook for oil prices going forward is that the powers that be intend to bankrupt the population at large and reduce them to a state of dependency in order to force them into the Universal Basic Income (UBI) and have already said so (“You will own nothing and be happy”) and a key plank to achieving this will be making the prices of the basics of life exorbitantly expensive.
A high oil price makes everything more expensive since oil is generally used to create and distribute food and products. Even if demand collapses, it will be possible to maintain high oil prices by engineering supply chain problems that may include sabotage and the effects of war.
The entire commodity sector looks set to rally, not least oil, in which case, emboldened by having just made new highs, it may simply continue to advance and may even accelerate. Its moving averages are in strongly bullish alignment, which helps.
Anticipation of higher oil prices may explain why the prices of oil stocks are running ahead of oil prices as we will now proceed to see as we review the charts.
In the last Oil Market update posted toward the end of August, we were prematurely bullish on oil, as it went on to drop further to hit bottom a month later towards the end of September, the decline being largely due to the strong dollar as was the case with many other commodities.
What was taken to be a breakout from a downtrend turned out to be the right side of the Left Shoulder of the now completed Head-and-Shoulders bottom that is shown on the latest 7-month chart for Light Crude below.
At the time, I was fooled by the strong Accumulation line, but as it turns out, it was just starting the basing process. In any event, oil’s chart now looks most promising, especially as other commodities such as copper, palladium, and Precious Metals appear to be breaking out at this time as the dollar looks increasingly vulnerable to a severe decline.
On the 3-year chart for Light Crude, it is immediately clear why the oil price corrected through the Summer – it had gotten ahead of itself with a dramatic spike to become extremely overbought early in the year.
Whilst the pattern that formed from March through June could mark a final high, a Double Top, that is not thought likely because of the way most commodities appear to be setting up for a major rally in the facing of rapidly mounting inflation, and also, as mentioned at the outset, because the powers that be want a high price to further their nefarious purposes, which they also happen to benefit from as they are the major stakeholders in the oil sector.
Overall this chart still looks positive, with oil having reacted back to a key support level where it appears to be turning up with momentum (MACD) swinging positive, suggesting renewed advance, and the oil stocks index, shown at the top of this chart, already starting to make new highs which is a sign that they are expecting higher oil prices. If we do see renewed advance soon, the moving averages will quickly swing back into strongly bullish alignment.
The moves shown on the long-term 20-year chart for Light Crude, at first sight, look random and chaotic, and they can only be understood in the context of the fundamental situations that generated them.
Commodities are looking set to take off higher as the dollar drops.
Thus, the plunge in 2008 – 2009 was directly attributable to the general market crash at that time, while the absurd lows of Spring 2020 were the result of Covid, and oil spiked early this year around the time of the Russian invasion of Ukraine.
The recent reaction has brought it back to the zone of significant support shown above the 2019 highs, which is turning it higher again.
As mentioned above, the positive divergence of oil stocks, whose index is shown at the top of this chart, strongly suggests a rising oil price going forward as oil stocks tend to lead oil itself and the position of the MACD indicator, which is closet to neutrality, shows that there is plenty of scope for a rally.
Turning now to the oil stocks, we see on the 7-month chart for the XOI oil index that it has been gyrating around rather wildly this year and has advanced strongly over the past six weeks or so, way outperforming oil itself, so that it is now overbought on its MACD indicator.
However, this may not stop it because the entire commodity sector looks set to rally, not least oil, in which case, emboldened by having just made new highs, it may simply continue to advance and may even accelerate. Its moving averages are in strongly bullish alignment, which helps.
On the 3-year chart for the XOI index, we can see that the oil sector has way outperformed the broad stock market this year — the S&P500 index is shown at the top of this chart — with the broad market putting in a dismal performance while oil stocks are now nudging new highs.
Whilst the oil index is now overbought, and thus in some danger of forming a Double Top with its June highs, this is not considered likely to the reasons already given, namely that commodities are looking set to take off higher as the dollar drops.
Instead, it looks set to advance to clear new highs and then continue to ascend for a while before a correction perhaps sets in.
The long-term 20-year chart for the XOI oil index is interesting as it shows that it has this year broken above a line of tops extending back to 2008.
Whilst the break to new highs is still not yet by a convincing margin, which means that it could slump back into the larger pattern, the outlook for the commodities sector here and the associated outlook for the dollar and for inflation implies that the sector could soon break higher and advance away from all those previous tops, which is not so surprising when you take into account that if you factor in inflation even if only up to now, it would have to rise quite a long way above its 2008 highs to attain the same inflation-adjusted value.
CliveMaund.com Disclosures
The above represents the opinion and analysis of Mr. Maund, based on data available to him, at the time of writing. Mr. Maund’s opinions are his own, and are not a recommendation or an offer to buy or sell securities. Mr. Maund is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations mentioned in his reports. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund’s opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction.
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EUR/USD has grown to 1.0310. This is the high since 4 July 2022.
The euro is supported by the market interest to risk and strong confidence that the US Federal Reserve System on its December meeting will take a pause and increase the interest rate by fewer base points than before. For now, expectations concerning the rate and the speed of the tightening of the US monetary policy are the crucial factors.
As for the drivers for the euro itself, they are ridiculously few. The economy of the Euro zone is expected to have grown by 3.2% in 2022. Yet in 2023 it is forecast to slow down by 0.4%.
On H4, EUR/USD has completed a wave of growth to 1.0360. Today the market is forming a consolidation range under this level. With an escape downwards, a wave of decline to 1.0173 is expected to start. After this level is reached, a link of growth to 1.0250 is expected to start, followed by a decline to 1.0000. Technically, this scenario is confirmed by the MACD: its signal line is at the highs, preparing to begin a decline to zero.
On H1, the pair has completed a wave of growth to 1.0360. At the moment, it is forming a consolidation range beneath it. An escaped downwards to 1.0255 is 3xpected. After this level is reached, a link of growth to 1.0320 is not excluded, followed by a decline to 1.0141, from where the wave may continue to 1.0000. Technically, the scenario is confirmed by the Stochastic oscillator. Its signal line is near 20, preparing to grow to 50. A bounce off it downwards and a return to 20 are expected.
Disclaimer
Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.
The BTC has returned to 17,360 USD, but the week has been unbelievably volatile and tough. The turmoil might be not over yet: cryptocurrencies have proved fragile again, and this might be a turning point for the market trust to digital assets.
Over the week, the BTC lost 15.6%. Today the capitalisation of the crypto sector is estimated as 877.48 million USD, the BTC taking up 38.1% and the ETH – 17.9%.
The BTC and other cryptocurrencies got an unexpected foothold in the US inflation statistics for October, which provoked flourishing of the US stock market. This driver managed to reverse everything going on with the Binance exchange and the FXT. It will take long for the investor trust to exchanges and markets to recover, yet the catastrophe in the crypto segment has been stopped.
The US inflation report gave some optimism to market players regarding future actions of the Federal Reserve System. Also, they had a good influence on the demand for risky assets.
At the same time, it must be admitted that the FXT problem is still around, and the market will keep on suffering from it as before, as soon as support from stock exchanges comes to an end.
To get a chance for stabilising, the BTC needs to secure above 18,500 USD. More forecasts will be later.
Coinbase goes on with redundancies
The Coinbase crypto exchange has fired 60 more employees by its programme of optimising staff. Employees were fired chiefly from the recruiting department and the institutional segment.
Attention! Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.
On H4, Brent quotes have broken through the 200-day Moving Average and are now below it, which signifies possible development of a downtrend. The RSI is testing the resistance line. In such circumstances, we should expect a downward breakaway of 6/8 (93.75) and subsequent falling to the support level of 5/8 (90.62). The scenario can be cancelled if the quotes rise over the resistance level of 7/8 (96.88), in which case they may rise to 8/8 (100.00).
On M15, further falling of the price may be supported by a breakaway of the lower line of VoltyChannel.
S&P 500
On H4, the quotes of the stock index are under the 200-day Moving Average, which signifies possible development of a downtrend. The RSI is testing the resistance line. In such circumstances, we should expect a downward breakaway of the support level of 1/8 (3906.2) and subsequent falling to 0/8 (3750.0). The scenario can be cancelled if the quotes rise over the resistance level of 2/8 (4062.5), which might lead to a trend reversal and growth of S&P 500 to 3/8 (4218.8).
On M15, a breakaway of the lower line of VoltyChannel will increase the probability of the price falling to 0/8 (3750.0) on H4.
Attention! Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.
