Today’s Key Market Drivers: 29th January 2019
Euro rallies as US Dollar remains under pressure.
The Euro continued its move higher on Monday against the Greenback as traders continue to price in their expectation that the US Fed will keep rates on hold in 2019. Traders are expecting the Fed to say growing economic risks locally and internationally are the reason to keep rates on hold for the foreseeable future.
Trade talks between the US and China also remain a key focal point with both countries keen to come to a resolution but neither willing to look weak and give too much ground.
Markets are mostly risk off leading into Tuesday.
Global stock indexes were mostly lower on Monday with all the majors finishing in the red. European and US markets were between 0.5% and 1% lower with the tech-heavy Nasdaq leading the way declining by 1.1%. There was no rush to buy the safe haven currencies such as the Yen and Swiss Franc but they are higher leading into Tuesday and I would expect the trend to continue today.
One reason why stock markets were lower was due to the fact that two significant listed US companies with exposure to China issued weaker than expected company earnings. The two companies were Caterpillar and chip maker Nvidia. Tech stocks Apple, Facebook and Amazon were also sharply lower. I still hold the view Amazon and Apple are great long-term buys.
Brexit vote in UK Parliament will move the Pound today.
Politicians in the UK will vote today on Theresa May’s latest Brexit plan and this has the potential to move the Pound which has been shooting higher for close on a month. It continues to trade above its 200 Day EMA on the daily chart benefiting from a weaker US Dollar and expectations early last week that a Northern Ireland Unionist Party may agree to a compromise and vote for Theresa May’s new Brexit plan.
If an agreement can be reached on Brexit expect to see a rush of buyers for the Pound which I believe could trade as high as 1.40 in coming months. This is on the expectation the US Fed does not raise rates and the Bank of England does.
My ShareSmart portfolio holdings.
ShareSmart is an incredible stock picking program that LTG GoldRock purchased in 2018 and those traders who are subscribing to the ShareSmart program will this week begin to receive my stock purchases via the Trade Time App.
In January I bought the stock Aristocrat Leisure at $22.93 and it is now trading at $24.60. I also bought ANZ at $25.24 and it closed at $26.19 on Monday. This week I am aiming to add one more stock to the portfolio which also holds Resmed and Soul Patterson.
Each Monday a specific ShareSmart video update is sent to all ShareSmart subscribers updating them on any future stock purchases and the reasons why. If you have not yet downloaded the free book How To Buy Great Shares At the Right Price please click on this link now https://www.sharesmart.com.au/
Each week ShareSmart hosts free live training for all LTG GoldRock members on how to purchase CFD stock through your MT5 Eight Cap platform so please ensure you keep a look out for the link to join the live coaching.
Will we see US economic data this week?
Now the US Government shut down is over (for 3 weeks anyhow) I am keen to see if we get the Durable Goods, Trade Balance and CPI numbers the market is expecting today. The US economy is expected to grow at a slower pace in 2019 and 2020, however, economic data through January has been non-existent due to the US Government shut down which started on December 21st. The CPI number today, if released, will be closely eyed as the US Fed starts its first meeting for 2019 and will issue its January statement and press conference on Thursday morning at 5.00am AEST.
The market does not expect the Fed to lift rates this month but the market does want to hear confirmation the Fed is planning a wait and see approach on interest rates for the balance of 2019. If they hint at further rate increases in the first half of 2019 stock markets will again fall sharply and the safe haven currencies will rally.
You can achieve whatever you want in life so long as you take extreme ownership.
One year ago today I embarked on a challenge to get sober after reading a book called Extreme Ownership. As part of my daily challenge, I also decided I would get up every day and watch the sunrise. Never missing a single day, I have welcomed each morning with as much enthusiasm as I can muster and even on the days I didn’t feel like getting up, I still got up. From my local beach at home to outback Australia, Singapore, New Zealand, London, Portugal, Hawaii and many parts of the USA, watching the sunrise every day has made me realise how wonderful life really is.
I wanted to achieve something for myself that was not about money, not about anything material but it was for me and my health. I am not about to stop, I will keep going and I will do my very best every day to inspire as many people as I can to live a lifestyle that will lead you to health and happiness. Health and Happiness not just for you but for your family as well.
I do not need alcohol to have a good time. AB
About the Author: Andrew Barnett
Andrew is a professional trader and successful investor who has a strong focus on education. He is a regular Sky News Money Channel Guest and one of Australia’s most awarded and respected financial experts and is regularly contacted by the Australian Media for the latest on what is happening with the Australian Dollar. Director at LTG GoldRock, Andrew Barnett, guides thousands of traders around the world in the live market on a daily basis, advising them on buy and sell directions, as well as trading his own personal account. Andrew, a regular keynote speaker at trading and wealth-creation events throughout the Asia Pacific region, is an authorized representative registered with the Australian Securities and Investment Commission (ASIC).
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