Gold Rises Ahead of Trump’s first Joint Address to Congress

Gold inched higher on Tuesday, increasing the price of yellow metal to more than $1250.00 an ounce ahead of the President Trump’s speech. The technical bias remains bullish because of a higher low in the recent downside move.

Technical Analysis

As of this writing, the precious metal is being traded near $1253 an ounce. A support may be noted around $1245, the trendline support area as marked with pink color in the given below daily chart. A break and daily closing below the $1245 support shall incite renewed selling interest, opening door for a move towards $1180, the low of 27th January.

On the upside, the precious metal is likely to face a hurdle near $1260, an immediate resistance ahead of $1278, the upper trendline resistance area as demonstrated with red color in the above chart. The technical bias shall remain bullish as long as the $1180 support area is intact.

President Trump’s Speech

Trump’s Speech Starts at 2:00 a.m. GMT. The US President is scheduled to speak at a joint session of the U.S. Congress on Tuesday, where investors hope for more details on the administration’s plans for tax reform, monetary policy and deregulation. We expect high volatility in the gold price amid Trump’s speech.

How Gold Reacted in Past on Trump Speeches

Gold rallied after the Donald Trump’s press conference last month. Before the press conference started, the US dollar was trading higher. However, after that, it receded giving a short boost to the precious metal. Investors kept looking for specific details about fiscal policies and tax reforms, but Trump didn’t address them. Instead, he focused on bashing China and Mexico. The incomplete and complicated nature of the information Trump provided raised concerns and pulled gold higher.

We saw a similar rally in gold after Donald Trump became the new President of America last year. The rally was however short-lived and the precious metal plunged sharply in next couple of days amid Trump’s stance on tax reforms and monetary policy.

How to Trade Gold after Trump’s Speech

It is recommended to buy call options in gold if the President avoids hinting at any major tax reforms or change in monetary policy stance.

Alternatively, buying put options may be a good strategy if the president signals tax reforms or change in the country’s monetary policy stance.

Trading EUR/USD Options amid CPI News Release

The Euro (EUR) inched lower against the US Dollar (USD) on Wednesday, dragging the price of EUR/USD to less than 1.0600 ahead of the Eurozone Consumer Price Index (CPI) news release. The technical bias remains bearish because of a lower high in the recent upside rally.

Technical Analysis

As of this writing, the pair is being traded around 1.0543. A support may be seen near 1.0484, the trendline support area as demonstrated in the given below daily chart with pink color. A break and daily closing below the 1.0484 trendline support shall incite renewed selling interest, validating a move towards the 1.0400 support zone which is a psychological number.

On the upside, the pair is expected to face a hurdle near 1.0552, the trendline resistance area ahead of 1.0700, the cluster of many resistance levels such as 38.2% fib level, upper trendline as well as psychological number. The technical bias shall remain bearish as long as the 1.0828 resistance zone is intact.

Eurozone Consumer Price Index

Eurostat is due to release the Consumer Price Index (CPI) data on Wednesday. It is considered to be a key gauge for inflation. According to the average forecast of different economists, the CPI remained 1.8% in January as compared to the same reading in January 2016. Generally speaking, higher CPI is considered good for the economy and vice versa.

How EUR/USD Reacted to Past CPI Releases?

Last time when CPI data was released by the EuroStat, the actual reading came out to be 1.8% as compared to the forecast of 1.3%, up beating the average forecast of economists. As per expectations, the Euro rallied 60 pips soon after the release.

In December, the actual data came out to be 1.1% as compared to 1.1% forecast of economists, hence meeting the average projection of economists. The EUR/USD pair didn’t show any notable volatility after the December’s CPI release.

How to Trade today’s CPI Data?

• Today if the CPI data comes more than 1.8%, then buying call options near resistance zone can be a good strategy.

• Alternatively, if the actual figure remains less than 1.8%, then buying put options below the trendline support can be a good strategy.
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USD/JPY Holds Range Ahead of US Inflation News

The US Dollar (USD) inched higher against the Japanese Yen (JPY) on Wednesday, increasing the price of USDJPY to more than 114.25 ahead of several high profile fundamental events. The technical bias remains bullish as the price continues trading in an upward slope channel.

Technical Analysis

As of this writing, the pair is being traded around 114.36. A hurdle may be noted near 114.48, the immediate trendline resistance area ahead of 115.37, the high of January 27th, 2017 as demonstrated in the given below chart. A break and four-hour closing above the 115.37 resistance shall incite increased buying pressure, validating a rally towards the 117.00 resistance zone in short to medium term.

On the downside, the pair is likely to find a support around 114.00, the psychological number as well as trendline support ahead of 113.46, the 50% fib level and then 111.59, the low of 6thFebruary 2017. The technical bias shall remain bullish as long as the 111.59 support area is intact.

CPI report – Today at 13:30 GMT

The US Bureau of Labor Statistics is due to release the Consumer Price Index report today. The report is considered a key gauge for inflation. According to the average forecast of different economists, the CPI remained 2.5% in January as compared to 2.1% in the same month of 2016. Generally speaking, higher CPI figure is considered positive for the US Dollar and vice versa.

Retail Sales

The Census Bureau of the US is also due to release the retail sales data today. According to the average forecast of different economists, retail sales registered a gain of 0.1% in January as compared to 0.6% in the month before. Generally speaking, higher retail sales figure is considered good for the US economy and vice versa.

How to Trade USD/JPY amid US Economic Releases

• The price of USD/JPY is expected to test 115.30 and 117.00 resistance levels in short to medium term if the CPI data comes better than expectations.

The CPI release is extremely important as the Federal Reserve’s interest rate decision heavily relies on CPI and unemployment figures.

• If the CPI misses average projections, then we can expect at least 200-300 pips fall in the USD/JPY price by the end of this week.

6 Facts to Learn About General Motors Right Now

On a lookout for a solid investment opportunity? You should consider General Motors options.
Here’s why:

1) Follow the leader

General Motors is a US automobile market leader with a 16.9% share, which has been steadily growing for 13 out of 14 past months.

GM YoY Revenues

2) In with the trends

In January 2016, General Motors and Lyft (a popular on-demand car service) announced “a long-term strategic alliance”. Lyft drivers will be driving a portfolio of GM cars, exposing General Motors to a broader clientele in more diverse locations.

GM invested $500 million in Lyft in Jan 2016

3) Defying expectations

GM’s average transaction price in January increased 4.4% during January 2017 – a new record for the month usually characterized by a slowdown of sales in the industry.

Chevrolet cars are seen at a GM dealership in Miami, Florida.

4) Strategic ventures

Having realized that the population of their vehicles is growing and more customers will soon be pushed into the aftermarket, GM ventured into the spare parts, accessories and components market. Company revenue quickly proved this to be a smart idea.

GM Middle East technicians

5) Not slowing down

In a recent press-release “General Motors” management said that the company is forecasting year-over-year growth in both sales and market share.

Chevrolet Corvette Grand Sport Collector’s Edition

6) Looking smart

The company is planning several vehicle redesigns this year, including for some of its popular SUVs, such as the Chevy Equinox and Chevy Traverse, which could lift sales.

Chevrolet Traverse

General Motors Company will be releasing their Q4 earnings Feb 07, 2017 before markets open — a perfect opportunity to trade GM classic options.

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