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AUD/USD, EUR/USD, and GBP/USD have sharply declined following hawkish comments from the Fed. AUD/USD has reached a 13-month low of $0.62, with support at $0.6171. EUR/USD has dropped to a November low, while GBP/USD slid to a three-week low of $1.2562, facing resistance at $1.2608 to $1.2617.
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Market participants anticipate minimal surprises from the central bank, expecting rates to remain steady while hinting at gradual hikes in 2025. The Fed's recent 25 basis point cut has shifted projections, now favoring two cuts in 2025 and two in 2026, amid rising inflation and growth forecasts.The hawkish tone from the FOMC meeting led to a sell-off on Wall Street, with Treasury yields surging and the US dollar reaching its highest level since November 2022. Asian markets followed suit, with the Nikkei 225 testing key support levels as traders await the Bank of Japan's upcoming meeting.
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Cathie Wood, founder of ARK Invest, predicts Bitcoin could reach $1.5 million by 2030, highlighting its potential to rival gold's $15 trillion market cap. With a current valuation of $2 trillion, she emphasizes Bitcoin's resilience, decentralized nature, and growing institutional adoption as key factors driving this forecast. As institutional momentum strengthens, Wood's vision reflects a broader belief in Bitcoin's transformative role in global finance.
Federal Reserve Chair Jerome Powell has firmly stated that the Fed cannot hold bitcoin due to legal restrictions outlined in the Federal Reserve Act, which limits its assets to U.S. government bonds. He reiterated his cautious stance on cryptocurrencies, labeling them as speculative and volatile, while distinguishing them from central bank digital currencies (CBDCs). Meanwhile, President-elect Donald Trump has proposed establishing a national bitcoin reserve, aiming to enhance the U.S.'s position in the cryptocurrency market, which has led to a surge in bitcoin's value.
European stocks fell 1.2% following a hawkish shift from the Federal Reserve, which reduced its forecast for interest rate cuts in 2025. The yen weakened past 156 against the dollar as the Bank of Japan maintained its borrowing costs, while US stock futures indicated a potential recovery amid a resilient economy. European government bonds also saw significant losses, with UK 10-year yields reaching their highest since October 2023 ahead of the Bank of England's policy decision.
The Federal Reserve has cut its benchmark interest rate by 25 basis points to a target range of 4.25%-4.5%, reflecting mixed economic signals. This decision comes as the crypto market faces declines, with Bitcoin down 4% and Ethereum and Solana experiencing larger losses.Economic projections indicate a GDP growth of 2.5% for 2024, with a slight rise in the unemployment rate to 4.3% by 2025. Analysts are cautious about future rate cuts, anticipating only two reductions in 2025, while uncertainty surrounding President-elect Donald Trump's policies adds to market volatility.
Bitcoin hovered around $104,710 as traders anticipated a Federal Reserve interest rate decision, with expectations leaning towards a 0.25% cut. Despite a dip-buying sentiment, pre-FOMC selling pressure was evident, and some analysts noted a potential gap in Bitcoin futures at $102,000 that could be filled during the announcement. Concerns about future rate hikes in 2025 due to rising inflation were also highlighted.
Major indexes showed mild gains as investors awaited the Federal Reserve's interest rate decision. Jabil surged 10% after strong earnings, while Heico fell over 5% despite good results, triggering a sell signal. Meanwhile, Birkenstock rallied on solid revenue growth, and Netgear spiked over 14% amid potential U.S. government actions against Chinese competitors.
Shares dipped slightly on Wednesday morning, with Nvidia rebounding 2.5% in premarket trading after a four-day losing streak. The Dow Jones Industrial Average rose 0.3% ahead of a Federal Reserve interest rate decision, while notable stocks like Amazon and Apple reached new highs. IBM and BlackRock are nearing key buy points, while Tesla faced a decline after recent gains.
Investors are anticipating a quarter-percentage point interest-rate cut from the Federal Reserve, with U.S. stock futures rising after the Dow's nine-session losing streak. Honda and Nissan are in merger talks, while Micron Technology's stock is up ahead of its earnings report, and Nvidia shares are rebounding after a recent decline.
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