Two Trades to Watch: FTSE, Gold

FTSE rises after upbeat Chinese services data

Chinese services PMI hit 55 from 52.9
UK composite to confirm 53, up from 48.6
FTSE extends rebound from 7850

The FTSE along with its European peers is pushing higher at the end of the week boosted by upbeat comments from Bank of England chief economist Huw Pill and by upbeat China services PMI data.

Chinese services PMI jumped shut up play in February I've consumer demand was revived amid the removal of tough covered restrictions. The Caixin services PMI rose to 55 in February, up from 52.9 in January, showing the sector expanded at the fastest pace in 6 months. The data comes after the manufacturing PMI showed activity expanded at the fastest pace in over a decade.

Meanwhile, the outlook in the UK is also improving slightly, according to BoE’s Huw Pill. He said that data suggests that the current momentum in economic activity may be stronger than anticipated.

Attention will now turn to UK composite PMI data, which is expected to confirm that business activity returned to growth in February to 53, up from 48.5.

Where next for the FTSE?

After falling to 7850 earlier in the week the FTSE has rebounded and is attempting to retake the multi-month rising trendline resistance. The RSI supports further upside while it remains above 50 but below 70 overbought level.

Buyers could look for a rise above 8000, the psychological level to extend the bullish run to 8046, the all-time high.

Gold rises ahead of US ISM services PMI

Gold rises across the week
US ISM services forecast at 54.5 from 55.2
Gold tests 20 DMA

Gold is heading higher on Friday and is set to book gains across this week even as the 10-year treasury yield pushed over 4%.

The latest leg higher comes after Atlanta Fed President Raphael Bostic said that the US central bank may need to raise interest rates higher but that they could be in a position to pause the tightening cycle in the summer.

Attention will now turn towards the US ISM services PMI which is expected to show that growth slowed slightly to 54.5 in February, down from 55.2 in January. Paid prices are forecast to drop sharply to 64.5 from 67.8.

Weaker data could help ease hawkish Fed jitters and send gold higher.

Where next for Gold?

Gold has broken out of the falling wedge, which, together with the bullish crossover on the MACD keeps buyers hopeful of further upside. Gold is testing resistance at 1845 the 20 sma a rise above here is needed to extend the runup towards the 50 sma at 1858.

Meanwhile, sellers could take note of the RSI which remains below 50. Should sellers successfully defend the 20 sma, bears could look for a break below 1830 yesterday’s low, before bringing 1820 the Friday 17^th low into play. Beyond here bears could target 1804, the 2023 low.

This report is intended for general circulation only. It should not be construed as a recommendation, or an offer (or solicitation of an offer) to buy or sell any financial products. The information provided does not take into account your specific investment objectives, financial situation or particular needs. Before you act on any recommendation that may be contained in this report, independent advice ought to be sought from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs.

StoneX Financial Pte. Ltd., may distribute reports produced by its respective foreign entities or affiliates within the StoneX group of companies or third parties pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the report is distributed to a person in Singapore who is not an accredited investor, expert investor or an institutional investor (as defined in the Securities Futures Act), StoneX Financial Pte. Ltd. accepts legal responsibility to such persons for the contents of the report only to the extent required by law. Singapore recipients should contact StoneX Financial Pte. Ltd. at 6826 9988 for matters arising from, or in connection with the report.

In the case of all other recipients of this report, to the extent permitted by applicable laws and regulations neither StoneX Financial Pte. Ltd. nor its associated companies will be responsible or liable for any loss or damage incurred arising out of, or in connection with, any use of the information contained in this report and all such liability is hereby expressly disclaimed. No representation or warranty is made, express or implied, that the content of this report is complete or accurate.

StoneX Financial Pte. Ltd. is not under any obligation to update this report.

Trading CFDs and FX on margin carries a high level of risk that may not be suitable for some investors. Consider your investment objectives, level of experience, financial resources, risk appetite and other relevant circumstances carefully. The possibility exists that you could lose some or all of your investments, including your initial deposits. If in doubt, please seek independent expert advice. Visit www.cityindex.com/en-sg/terms-and-policies for the complete Risk Disclosure Statement.

ALL TRADING INVOLVES RISKS. LOSSES CAN EXCEED DEPOSITS.

City Index is a trading name of StoneX Financial Pte. Ltd. (“SFP”) for the offering of dealing services in Contracts for Differences (“CFD”). SFP holds a Capital Markets Services Licence issued by the Monetary Authority of Singapore for Dealing in Exchange-Traded Derivatives Contracts, Over-the-Counter Derivatives Contracts, and Spot Foreign Exchange Contracts for the Purposes of Leveraged Foreign Exchange Trading. SFP is also both Derivatives Trading and Clearing member of the Singapore Exchange (“SGX”). SFP is a wholly-owned subsidiary of StoneX Group Inc.

The information provided herein is intended for general circulation. It does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should take into account your specific investment objectives, financial situation or particular needs before making a commitment to invest, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit. No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk.

The information does not represent an offer of, or solicitation for, a transaction in any investment product. Any views and opinions expressed may be changed without an update. To understand the risks and costs involved, please visit the section captioned “Important Information” and the “Risk Disclosure Statement”.

The information herein is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.

StoneX Financial Pte. Ltd. 1 Raffles Place, #18-61, One Raffles Place Tower 2, Singapore 048616. Tel: 6309 1000. Co. Reg. No.: 201130598R.

This advertisement has not been reviewed by the Monetary Authority of Singapore.