US Government Bonds 10 YR YieldHello everyone,
A quick look at the rate at 10 US.
Republican effect with its program?
Make your opinion, before placing an order.
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Economy
S&P 500 Daily Chart Analysis For Week of Nov 1, 2024Technical Analysis and Outlook:
During the current trading session, the S&P 500 index exhibited considerable weakness by completing the Inner Index Dip at 5733, in conjunction with the Mean Support level of 5798, while leaving the gap by not reaching the secondary Mean Support level of 5700. This development of fulfilling the gap will likely stimulate a significant rebound toward the Mean Resistance level of 5775, with the possibility of further extension. The 5700 support level is critical for facilitating a primary recovery and advancing into the subsequent phase of the bullish trend. However, it is imperative to acknowledge that achieving and penetrating the 5700 level could instigate a downward spiral in price action to Mean Sup 5620.
Bitcoin(BTC/USD) Daily Chart Analysis For Week of Nov 1, 2024Technical Analysis and Outlook:
According to the analysis of the Bitcoin Daily Chart for October 25, the "Interim Rebound" in Bitcoin has successfully concluded the Main Inner Coin Rally at 73300. It has subsequently retraced to the support level of 69400. This level represents the inverse of the previously completed Inner Coin Rally at 69400. We anticipate initiating a primary rebound, which is expected to support a recovery that will retest the Key Resistance at 73200. This movement will align with the completion of the Main Inner Coin Rally at 73300 and may lead to further progression into the next phase of the bullish trend, designated as the Next Inner Coin Rally at 78500 and beyond. Conversely, we project a potential additional pullback to satisfy the criteria of the newly established Inner Coin Dip at 66200.
SPX in monthly (log)Hello community,
A quick review of the month on the SPX index.
A red candle for this month of October.
I have indicated in orange the simple 12-period average (monthly)
The price is in the upper part of the channel, I don't see anything alarming on the chart.
The trend is still bullish, I prefer to invest my money in the American market, than on the old continent which is very sick!
Whether it is Harris against Trump, the new president will have a country in working order to face the future. I have confidence in the USA.
Make your opinion, before placing an order.
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$EUIRYY -Europe's Inflation Rate (October/2024)ECONOMICS:EUINTR 2%
(October/2024)
+0.3%
source: EUROSTAT
-Annual inflation in the Euro Area accelerated to 2% in October 2024, up from 1.7% in September which was the lowest level since April 2021, and slightly above forecasts of 1.9%, according to preliminary estimates.
This year-end increase was largely expected due to base effects, as last year’s sharp declines in energy prices are no longer factored into annual rates.
Inflation has now reached the European Central Bank’s target.
In October, energy cost fell at a slower pace (-4.6% vs -6.1%) and prices rose faster for food, alcohol and tobacco (2.9% vs 2.4%) and non-energy industrial goods (0.5% vs 0.4%).
On the other hand, services inflation steadied at 3.9%.
Meanwhile, annual core inflation rate which excludes prices for energy, food, alcohol and tobacco was unchanged at 2.7%, the lowest since February 2022 but above forecasts of 2.6%. Compared to the previous month, the CPI rose 0.3%, following a 0.1% fall in September.
$JPINTR -Japan's Interest Rates (October/2024)ECONOMICS:JPINTR 0.25%
October/2024
source: Bank of Japan
- The Bank of Japan (BoJ) unanimously maintained its key short-term interest rate at around 0.25% during its October meeting, keeping it at the highest level since 2008 and matching market estimates.
Thursday's decision came amid shifting political lansdscape following Japan's election and ahead of the US presidential election.
In a quarterly outlook, the BoJ held its forecast that core inflation to reach 2.5% in FY 2024, with inflation expected to be around 1.9% for both FY 2025 and FY 2026.
Regarding the GDP, the central bank retained its 2024 growth forecast at 0.6%.
Additionally, it forecasts growth of 1.1% for FY 2025 and 1.0% for FY 2026.
$USGDPQQ -U.S GDP (Q3/2024)ECONOMICS:USGDPQQ 2.8%
Q3/2024
source: U.S. Bureau of Economic Analysis
-The US economy expanded an annualized 2.8% in Q3 2024,
below 3% in Q2 and forecasts of 3%, the advance estimate from the BEA showed.
Personal spending increased at the fastest pace since Q1 2023 (3.7% vs 2.8% in Q2),
boosted by a 6% surge in consumption of goods (6% vs 3%) and a robust spending on services (2.6% vs 2.7%), mostly prescription drugs, motor vehicles and parts, outpatient services and food services and accommodations.
Government consumption also rose more (5% vs 3.1%), led by defense spending.
In addition, the contribution from net trade was less negative (-0.56 pp vs -0.9 pp), with both exports (8.9% vs 1%) and imports (11.2% vs 7.6%) soaring, led by capital goods, excluding autos. On the other hand, private inventories dragged 0.17 pp from the growth, after adding 1.05 pp in Q2.
Also, fixed investment slowed (1.3% vs 2.3%), led by a decline in structures (-4% vs 0.2%) and residential investment (-5.1% vs -2.8%).
Investment in equipment however, soared (11.1% vs 9.8%).
$EUGDPQQ -Europe's GDP (Q3/2024) ECONOMICS:EUGDPQQ 0.4%
Q3/2024
source: EUROSTAT
- The Eurozone GDP expanded 0.4% on quarter in the three months to September 2024,
the strongest growth rate in two years, following a 0.2% rise in Q2 and above forecasts of 0.2%
The German economy expanded 0.2%, surprisingly avoiding a recession, after a downwardly revised 0.3% decline in Q2.
GDP growth also quickened in France (0.4% vs 0.2% in Q2) and the Spanish economy remained robust (0.8% vs 0.8%).
In addition, the Portuguese economy grew 0.2%, the same as in Q2 while the GDP in Ireland (2% vs -1%) and Austria (0.3% vs 0%) rebounded and grew faster in Lithuania (1.1% vs 0.3%).
On the other hand, the Italian economy stalled, following a 0.2% rise in Q2 and Latvia remained in contraction (-0.4% vs -0.3%). Year-on-year, the Eurozone GDP expanded 0.9%, the best performance since the Q1 2023, compared to a 0.6% rise in the previous quarter and higher than forecasts of 0.8%.
The ECB expects the GDP in the Eurozone to expand 0.8% this year.
ETF SPY weekly (log)Hello everyone,
Weekly chart in logarithmic scale.
The channel is bullish, we are in the upper part of the channel, but I do not see any bullish exaggeration.
The 200-period simple average is bullish in orange on the screen.
In any case, investing in the SPY is a very good investment.
Make your own opinion, before placing an order.
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What Is a Petrodollar and How Does It Affect the Global Economy?What Is a Petrodollar and How Does It Affect the Global Economy?
The concept of petrodollars is an insightful topic to study. The petrodollar isn’t a specific currency but a financial system that reflects economic and political forces that have shaped international relations for decades. This concept is critical to understanding global trade dynamics and geopolitical strategies.
Petrodollar: Definition and Origins
A petrodollar refers to the US dollars earned by oil-exporting countries through the sale of oil to other nations. The term gained fame in the 1970s, a period marked by significant changes in the global economic landscape, particularly concerning energy resources and currency stability.
Historical Context
The petrodollar system received a significant boost in development as a result of economic necessity and geopolitical strategy during the turbulent 1970s. Key historical events, such as the collapse of the Bretton Woods system, the 1973 oil crisis, and the US–Saudi agreement, set the stage for the creation of the term ‘petrodollar’. These events emphasised the importance of securing stable economic fundamentals in the face of global uncertainty.
Bretton Woods Agreement
The Bretton Woods Agreement, established in 1944, created a system of fixed exchange rates anchored by the US dollar, which was convertible to gold. This system fostered post-war economic stability. The Bretton Woods Agreement led to the formation of the World Bank and the International Monetary Fund. The system eventually collapsed in 1971 when President Richard M. Nixon ended the dollar’s convertibility to gold. This collapse left the global economy searching for a new anchor.
1973 Oil Crisis
In 1973, the Organisation of Arab Petroleum Exporting Countries (OAPEC) declared an oil embargo against the US and other Western countries that supported Israel during the Yom Kippur War. The embargo prohibited oil exports to target countries and led to a reduction in oil production. The immediate impact was a sharp increase in oil prices. This crisis underscored the strategic importance of oil and prompted economic shifts.
US–Saudi Agreement
On 8th June 1974, Saudi Arabia entered into an agreement with the United States to accept dollars as the sole payment currency for its oil in exchange for the countries’ bilateral cooperation and US military support to the Saudi regime. This so-called ‘petrodollar agreement’ virtually pegged the value of the US dollar to global oil demand and ensured its continued dominance as the world’s main reserve currency.
Mechanisms of the Petrodollar System
The petrodollar system refers to the practice of trading oil in US dollars, as well as the broader arrangements that support it. Let’s see how it is manifested.
Oil Purchases
Global oil sales are predominantly in US dollars, regardless of the buyer or seller’s country. This practice means that countries buying oil must hold dollar reserves, which creates a constant global demand for dollars. This supports the currency’s value and gives the US significant influence over global financial markets. As a benefit, uniformity reduces currency risk and transaction costs.
Oil Sales
The settlement of oil transactions involves the transfer of dollars through international banking systems, although US banks are the most predominant. The US can exert economic pressure by restricting access to the dollar financial system, effectively imposing sanctions on countries.
Recycling of Petrodollars
Petrodollar “recycling” refers to the way oil-exporting countries utilise their oil revenue. These countries spend part of their oil revenues on foreign goods and services and save another portion as foreign assets. These assets can include deposits in foreign banks, bonds, and private equity investments. Ultimately, the foreign exchange earned by oil exporters from increased oil exports flows back into the global economy, hence the term “recycled.”
Economic and Political Implications
The petrodollar system has profound implications for the global economy and geopolitics.
Global Trade and Geopolitics
The petrodollar system standardises oil pricing, simplifies transactions, and reduces exchange rate risks for oil-importing countries, thereby facilitating smoother international trade flows. The petrodollar system cemented the relationship between the United States and Saudi Arabia, along with other oil-producing nations, forming a strategic alliance that would influence global politics for decades.
Oil-Exporting Countries
Oil-exporting countries reinvest revenues into exploration, drilling, and infrastructure projects, boosting oil production and driving technological advancements. Additionally, petrodollars allow oil-exporting nations to invest in the domestic economy and stimulate domestic growth.
US Economic Influence
The petrodollar system increased global demand for the dollar, solidifying its status as the world’s primary reserve currency. Oil-exporting countries holding large reserves of US dollars invest them in US government securities, which support the US economy. The demand for US dollars maintains a favourable trade balance for the United States. Oil transactions increasing the global circulation of dollars support US exports.
High dollar demand ensures ample liquidity in the forex market, making it the most widely traded currency. If you are interested in trading currencies such as the US dollar, explore popular USD pairs on the TickTrader platform.
Criticisms and Challenges
While the petrodollar provides economic and geopolitical advantages, it also exposes countries to a number of risks and challenges.
Economic Disparities
Critics argue that the petrodollar exacerbates global economic inequality. By concentrating economic power and benefits in the hands of a limited group of oil-exporting countries, it perpetuates inequality and prevents more equitable economic development. This concentration of wealth and influence often puts poorer countries at a disadvantage, as they find it difficult to compete on a world stage dominated by petrodollar transactions.
Dependency and Vulnerability
The petrodollar system also creates dependencies:
1. Oil-importing countries must maintain dollar reserves, potentially exposing their economies to changes in the USD rate.
2. Oil-exporting countries invest heavily in the US economy and financial instruments, making them vulnerable to economic fluctuations and potential restrictions by the US, such as sanctions.
3. The US economy profits from the capital inflows, as they help finance the federal budget and support economic growth. Reduced inflows may negatively impact the US economy.
4. Changes in geopolitical alliances, regional conflicts, and economic policies can impact the stability and future of the petrodollar system. The collapse of the petrodollar could have serious consequences for the US and global economy.
Future of the Petrodollar
The future of this system is uncertain, especially with the changing geopolitical landscape. Saudi Arabia has opted to terminate the 50-year petrodollar agreement with the US, and it expired on June 9, 2024, which was referred to as the end of the petrodollar in the news.
This agreement has been the cornerstone of the petrodollar system, and its expiration marks a significant shift. It means that oil will be traded in multiple currencies, including the Chinese yuan, euro, yen, and potentially digital currencies like Bitcoin. These efforts reflect a growing desire to reduce dependency on the dollar and diversify economic risks.
These changes may contribute to a more balanced global economic environment by weakening the influence of the dollar, creating a more multipolar currency system, and providing countries with greater financial autonomy.
Another threat to the oil-US dollar system is that countries seek sustainable energy alternatives and new economic alliances emerge. In particular, the shift to renewable energy could reduce the world’s dependence on oil, thereby decreasing the centrality of the traditional energy system and the US dollar, causing a reassessment of the existing order.
Final Thoughts
The petrodollar, born out of historical necessity and strategic agreements, may no longer be a cornerstone of economics and geopolitics. As global energy and financial systems evolve, the role of the petrodollar has become the subject of critical analysis and debate, and the recent termination of the US–Saudi agreement is a prime example of the changing economic and geopolitical landscape.
Changes may lead to revaluation of various currencies and market volatility. Those who are interested in catching market volatility and trading on news events, can open an FXOpen account and start trading various USD pairs.
FAQ
What Is the Petrodollar?
The petrodollar is the name of the system that reflects US dollars earned by a country through the sale of its petroleum to other countries. This term highlights the relationship between global oil sales and the US dollar.
When Was the Petrodollar Created?
The petrodollar concept was created in the mid-1970s. The turning point came in 1974 when the United States and Saudi Arabia reached an agreement that oil prices would be set exclusively in US dollars. This agreement followed the collapse of the Bretton Woods System and the 1973 oil crisis.
Why Is Oil Only Traded in Dollars?
Currently, oil is not only traded in dollars. Some oil-exporting countries use their national currencies, and the euro and Chinese yuan may be widely used for oil trading in the near future. Oil was traded in dollars mainly because of the 1974 US-Saudi agreement. It created a standard currency for oil transactions and reduced exchange rate risks. But since the agreement was terminated in June 2024, other currencies may become more common in oil transactions.
Is the US Dollar Backed by Oil?
No, the US dollar is not backed by oil. Since the end of the Bretton Woods System in 1971, no physical commodity has backed the dollar. However, the petrodollar system creates a close link between the dollar and the global oil trade, maintaining the value of the dollar through constant demand for it in international markets.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
When Do Breaking ATMs Signal More Than Just Technical Failure?In a fascinating twist of economic irony, Turkey's banking system faces a crisis not from a shortage of money, but from an overwhelming abundance of near-worthless banknotes. This peculiar situation, where ATMs physically break down from dispensing too many low-value bills, serves as a powerful metaphor for the broader economic challenges facing emerging markets in an era of hyperinflation.
The numbers tell an extraordinary tale: a 700% currency depreciation since 2018, 80% of circulating notes being the highest denomination available, and a stark disparity between official inflation rates of 49% and independent estimates of 89%. Yet perhaps most intriguing is the government's reluctance to print larger denominations – a psychological barrier rooted in the traumatic memory of million-lira notes from the 1990s. This resistance to adaptation, despite the obvious operational strain on the banking system, raises profound questions about the role of political psychology in economic policy-making.
What emerges is a complex narrative about the intersection of technological capacity, monetary policy, and human psychology. As Turkish banks spend entire days counting money for simple transactions and regulators continuously delay implementing hyperinflationary accounting standards, we witness a unique case study of how modern financial systems can be overwhelmed not by sophisticated cyber threats or market crashes, but by the sheer physical weight of devalued currency. This situation challenges our traditional understanding of banking crises and forces us to reconsider the practical limits of monetary policy in an increasingly digital age.
Bitcoin Buy Signal (1H)MEXC:BTCUSDT
As we knew before that when IDMs got grabbed,
after getting a SCOB on our structure time frame,
or wait for a ChoCh on the lower time frame (which now the LTF is 5 mins chart),
we can get into the position (which here is a Buy Position).
And now we had a ChoCh on the 5 mins time frame on Bitcoin which allows us to open a Buy Position.
P.S: Money & Risk Management is Crucial, Because nothing's certain in the market. :)
I will update Bitcoin regularly,
Follow me on TradingView for more.
Happy trading..
Cheers,
Aurio
S&P 500 Daily Chart Analysis For Week of Oct 25, 2024Technical Analysis and Outlook:
During this week's trading session, the S&P 500 index exhibited notable weakness by falling below the Mean Support level of 5818 and subsequently establishing a new Mean Support at 5798. This development will likely prompt a decline toward the Inner Index Dip at 5733, with a potential extension to Mean Support at 5700. This support level is critical for enabling a primary recovery and advancing into the next phase of the bullish trend. Furthermore, it is essential to recognize that achieving levels of 5833 and 5700 may result in a rapid upward price reaction.
EUR/USD Daily Chart Analysis For Week of Oct 25, 2024Technical Analysis and Outlook:
The Eurodollar has experienced persistent bearish sentiment during this week's trading session, demonstrating insufficient strength to initiate any interim rebound. The prevailing selling pressure has lowered the Eurodollar to our Mean Support level of 1.079. A temporary rebound led to the reversal of the previously established Inner Currency Dip at 1.083, which currently stands as Mean Res 1.083 and might serve as the Interim Rebound's first stage. The Euro appears poised for further decline, potentially reaching the inner currency dip of 1.075, which remains notably significant and triggers second stage Interin Rebound to Mean Sup 1.078.
Bitcoin(BTC/USD) Daily Chart Analysis For Week of Oct 25, 2024Technical Analysis and Outlook:
As stated in the Bitcoin Daily Chart Analysis For the Week of Oct 18, the Bitcoin ''Interim Rebound'' completed our Inner Coin Rally of 69300 and retreated to the Mean Support level of 66800 and interim squeeze extension of the Mean Support of 65300 in this week's trading session. Currently, we anticipate the onset of a primary rebound, which is expected to facilitate recovery and further advancement into the subsequent phase of the bullish trend.
US Government Bonds 10 YR YieldDaily chart on 10-year rates, be careful, we have just crossed the line above the 200-period simple moving average.
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S&P 500 Daily Chart Analysis For Week of Oct 18, 2024Technical Analysis and Outlook:
During this week’s trading session, the index demonstrated substantial strength by exceeding the Outer Index Rally level of 5840 and achieving the subsequent milestone at 5861. This accomplishment will likely precipitate a squeeze toward the Mean Support level 5818. This support is crucial for facilitating the primary recovery and advancing into the next phase of the bullish trend.
EUR/USD Daily Chart Analysis For Week of Oct 18, 2024Technical Analysis and Outlook:
The Eurodollar experienced sustained bearish sentiment again during this week's trading session, with the prevailing selling pressure completing our Inner Currency Dip of 1.083. A transient rebound is in progress to the Mean Res 1.090. However, considering the current bearish price action, the probability of further declines to the support level of 1.079 and the next Inner Currency Dip of 1.075 remains substantial.
Bitcoin(BTC/USD) Daily Chart Analysis For Week of Oct 18, 2024Technical Analysis and Outlook:
The Bitcoin ''Interim Rebound'' rammed through our Mean Res 66300 and Inner Coin Rally 67000 and rested at our Mean Res 68500 in this week's trading session, and it is currently poised to hit Inner Coin Rally 69300. A breach of this critical price level will catalyze a movement towards the all-time prices marked as Key Res 73200 and the completed Main Inner Coin Rally 73300. However, on the downside, the interim bearish sentiment may lead to a decline in the coin's price value to the Mean Support level of 66800 and possibly the Mean Support of 65300. Only then will the primary recovery and advancement into the subsequent phase of the bullish movement be realized.
$CNGDPYY - China's GDP (Q3/2024)ECONOMICS:CNGDPYY Q3/2024
source: National Bureau of Statistics of China
-The Chinese economy expanded 4.6% YoY in Q3 of 2024,
compared with market forecasts of 4.5% and a 4.7% rise in Q2.
It marked the slowest annual growth rate since Q1 2023, amid persistent property weakness, shaky domestic demand, deflation risks, and trade frictions with the West.
The latest figures came as Beijing had intensified stimulus measures to boost economic recovery and rebuild confidence.
In September alone, there were some positive signs:
industrial output and retail sales both saw their largest increases in four months, and the urban jobless rate fell to a three-month low of 5.1%.
On the trade front, however, exports rose the least in five months while imports were sluggish. In the first three quarters of the year, the economy grew by 4.8%, compared with China’s full-year target of around 5%.
During the period, fixed investment rose by 3.4% yoy, topping consensus of 3.3%.
$JPIRYY -Japan's CPI (September/2024)ECONOMICS:JPIRYY 2.5%
(September/2024)
source: Ministry of Internal Affairs & Communications
- The annual inflation rate in Japan fell to 2.5% in September 2024 from 3.0% in the prior month, marking the lowest reading since April.
Electricity prices increased the least in three months as the impact of energy subsidy removal in May waned (15.2% vs. 26.2% in August), and the cost of gas rose much more slowly (7.7% vs. 11.1%).
Moreover, costs moderated for food (3.4% vs. 3.6%), furniture & household utensils (4.8% vs. 5.2%), transport (0.1% vs. 0.2%), and culture (4.3% vs. 4.8%).
Additionally, prices fell further for communication (-2.6% vs. -2.4%) and education (-1.0% vs. -1.0%).
On the other hand, inflation remained unchanged for housing (0.7%) and healthcare (1.5%), while edging higher for clothes (2.4% vs. 2.3%) and miscellaneous (0.9% vs. 0.8%).
Meanwhile, the core inflation rate hit a five-month low of 2.4%, down from August's 2.8%, compared with the consensus of 2.3%.
On a monthly basis, the CPI declined by 0.3%, pointing to the first drop since February 2023.
$EUINTR -Europe Interest Rates ECONOMICS:EUINTR (October/2024)
source: European Central Bank
- The ECB lowered its three key interest rates by 25 bps in October 2024, as expected, following similar moves in September and June.
The deposit facility, main refinancing operations, and marginal lending facility rates will now be 3.25%, 3.40%, and 3.65%, respectively.
This decision stems from an updated assessment of inflation, which shows disinflation progressing well.
In September, inflation in the Eurozone fell below the ECB’s target of 2% for the first time in more than three years.
While inflation is expected to rise in the short term, it should decline toward the 2% target in 2025.
Wage growth remains high, but pressures are easing.
The ECB remains committed to restrictive rates to ensure inflation reaches its medium-term goal, using a data-driven, flexible approach without committing to a specific rate path.
$GBIRYY -U.K CPI (September/2024)ECONOMICS:GBIRYY 1.7%
source: Office for National Statistics
-Annual inflation rate in the UK fell to 1.7% in September 2024, the lowest since April 2021, compared to 2.2% in each of the previous two months and forecasts of 1.9%.
The largest downward contribution came from transport (-2.2% vs 1.3%), namely air fares and motor fuels.
Fares usually reduce in price between August and September, but this year this was the fifth largest fall since monthly data began in 2001.
Also, the average price of petrol fell to 136.8 pence per litre compared to 153.6 pence per litre in September 2023.
In addition, prices continued to fall for housing and utilities (-1.7% vs -1.6%) and furniture and household equipment (-1% vs -1.3%) and cost rose less for recreation and culture (3.8% vs 4%) and restaurants and hotels (4.1% vs 4.3%).
Meanwhile, services inflation slowed to 4.9%, the lowest since May 2022, from 5.6% in August. On the other hand, the largest offsetting upward contribution came from food and non-alcoholic beverages (1.9% vs 1.3%).
