Trade Idea (2020-12-17) USD selling after Powell’s press conference

Trade Idea

Good morning.

Yesterday’s US stocks were mixed, with the Dow Jones Industrial Average closing at -0.15%, the S & P 500 closing at + 0.18% and the Nasdaq Composite closing at + 0.50%. U.S. retail sales announced in the morning fell more than expected, selling ahead in the early stages, FOMC results announced in the afternoon show no change in asset purchase composition or pace, and member interest rate outlook will not raise interest rates until 2023 The reconfirmation, followed by Chair Powell’s meeting, emphasized his commitment to mitigation, which led to a repurchase. Nasdaq, which focuses on IT and high-tech, was strong, and Russell 2000, a small and medium-sized stock, was relatively weak.

The day of Tesla’s inclusion in the S & P 500 (Monday, December 21st) is approaching. It may be a turning point in the market, so be careful.

In the foreign exchange market, the yield on US Treasuries rose immediately after the announcement of the FOMC, leading to USD buying. EURUSD temporarily fell to 1.2125 and then recovered sharply to around 1.22.

EURUSD H1 (Please click the chart to enlarge.)

Market Environment

Yesterday’s currency strength

US market yesterday (last Friday)

DJI: 30,154.54 (-44.77, -0.15%)
S&P500: 3,701.17 (+6.55, +0.18%)
Nasdaq Composite: 12,658.19 (+63.13, +0.50%)
Nasdaq 100: 12,668.16 (+72.24, +0.57%)
Russel 2000: 1,952.72 (-7.04, -0.36%)
Gold Future: 1,868.30 (+9.2001)
Oil Future: 47.82 (UNCH)
US10Y: 0.921% (+0.001)
VIX: 22.50 (-0.39)

Asian market today

Nikkei: 26,778 (+21)
CME Dow future: 30,088~(-66 Dow)

Economic indicators in this week

21:45 (NZ) 3QGDP
00:30 (AU) Unemployment rate
12:00 (UK) BOE policy interest
12:00 (UK) BOE minutes
13:30 (US) New jobless claim
13:30 (US) Housing start