Dear Trader,

1st of January 2022 onwards, Vantage will be using the new domain vantagemarkets.com.

While vantagefx.com is still live, we encourage you to update your bookmarked URL, email address book, marketing hyperlinks, and visit vantagemarkets.com for the most up-to-date notifications, contents, promotions and queries support.

Do take note that as of 1st of February 2022, vantagefx.com will no longer be online.

Should you have any questions or require assistance from our team, feel free to reach out to us at [email protected]

Market news

Daily finance news update

OPEN LIVE ACCOUNT

Sterling enjoys the surprise Xmas hike

December 17,2021 05:10:43

Overnight Headlines

*Bank of Japan scales back emergency funding as pandemic strains ease

*Nasdaq closes sharpy lower as investors dump growth stocks

*Dollar falls as markets digest raft of diverging central bank decisions

USD fell on Thursday as investors’ focus turned to other central bank meetings. The DXY dropped to lows of 95.85 before closing around 96.04. GBP surged to a high of 1.3374 but eased to close at 1.3323. EUR/GBP fell to a low of 0.8453 after the surprise BoE hike and then recovered above 0.85. EUR/USD reached a high of 1.1360 and then fell back to 1.13. USD/JPY traded back below the pre-Fed levels. The spike earlier in the week in USD/CAD to 1.2937 saw prices move back towards 1.28.

US equities retreated led by weakness in big-tech names. The Nasdaq had its worst day since September falling 2.47% while the S&P500 shed 0.87% as heavyweight growth stocks underperformed. The Dow lost 0.08% after being up more than 200 points, with financials rallying. Asian stocks are mixed with US futures in the red.

Market Thoughts – ECB tapers cautiously

It has been a hectic few days of central bank meetings and trying to decipher their long-term impact. The ECB tried to dish out something for both the hawks and the doves. It tapered its emergency bond buying programme (PEPP) before the scheme ends in March next year. But it will purchase more bonds in its older scheme (APP) which remains open-ended and is a big victory for the doves.

However notably, inflation forecasts were moved sharply higher, as was the risk assessment. This added an element of hawkishness. So, the idea of trying to predict what the ECB might do in one- or two-years’ time is tough, especially when President Lagarde mentioned “flexibility” repeatedly. The bank has started tapering, but any rate hike chatter from policymakers is likely to be put off for as long as possible.

Chart of the Day – GBP/USD base built

Upside surprises to inflation convinced the BoE to tighten pre-emptively yesterday, despite mounting Omicron uncertainty. Perhaps the biggest surprise was how many MPC members voted for a hike, after the disappointment of not raising rates at its last meeting. The key question now is the path of the rate hike cycle and the timing of the next move.  

Cable had shown signs of stabilising around 1.32 before the meeting. A “rounding bottom” is often found at the end of extended downward trends and signifies a reversal in the long-term trend. Wednesday had a bullish outside reversal day and prices pushed up above 1.33 beyond the 50-day SMA after the BoE. Major resistance is 1.3411 and 1.3571/79.

Jamie DuttaAnalyst / Trader

"With extensive experience as a full time trader and financial market commentator, I have worked as a trader in top tier investment banks and trading houses, including Morgan Stanley and GAIN Capital trading Forex, Index derivatives. and Bonds. I combine technical analysis with a deep fundamental knowledge to identify trade set-ups. My real life experience allows me to break down the complexities of financial jargon and trading. This means everyone can better understand the compelling forces of greed and fear which are realised every day in countless ways across markets."

Vantage does not represent or warrant that the material provided here is accurate, current, or complete, and therefore should not be relied upon as such. The information provided here, whether from a third party or not, is not to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any financial instruments; or to participate in any specific trading strategy. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. We advise any readers of this content to seek their own advice. Without the approval of Vantage, reproduction or redistribution of this information is not permitted.

Fast & easy account opening

  • Register

    Choose an account type and submit your application

  • Fund

    Fund your account using a wide range of funding methods.

  • Trade

    Access 300+ CFD instruments across all asset classes on MT4 / MT5

That's it, it's that easy to open a Forex and CFD trading account.
Welcome to the world of trading!
open live account