First Citizens bank buys a stake in SVB

BY Janne Muta

|March 28, 2023

The DJ continued to edge higher yesterday. The bullish move was supported by a deal in which First Citizens bank agreed to buy a stake in Silicon Valley Bank. Equities moved higher with the energy (+2.13%) and banking stocks (+1.39%) leading the pack.

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T-Bonds traded lower which meant the yields rose taking some of the gold’s shine off. The only S&P 500 sectors losing yesterday were real estate, communication, and technology. Their declines were between 0.34% and 0.77%. Today’s main risk events are the CB Consumer Confidence and the Richmond Manufacturing Index releases. Heads up also for the ECB President Lagarde’s speech.

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FTSE remains bullish

UK 100 remains bullish above 7330 in the daily chart. The nearest key support level in the 2h chart is at 7423. The FTSE is probably going to test the last week’s high (7590) and while the market (based on the current technicals) could very well trade beyond the level it’s possible that we’ll see profit taking around it. Alternatively, if the 7330 level doesn’t hold FTSE probably trades down to 7250 or so.

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DAX trends higher above 14 800

DAX trades higher in the 8h chart and is bullish above 14 800. The market is trading near a level that caused it to sell off a couple of times. Now, however, there’s a higher low in place (14 800) which indicates to me that the bulls are getting stronger. Therefore, it’s more likely we’ll see the market pushing through the resistance than to see the 14 800 level broken decisively. A strong push above 15 300 opens the way to 15 450 or so. Alternatively, a break below 14 800 could take the market to 14 650.

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Gold remains in a range

Gold remains in a sideways range below Friday’s high. After a top-heavy weekly candle and a lower swing high risks of a deeper correction have increased. Lower highs are quite often followed by more downside. Now the 1966 support is broken and it’s likely the 1934 level also gets tested. If it holds, a rally to 1980 or so wouldn’t surprise. Below 1934 we might well see a move to 1920.

The Next Main Risk Events

  • GBP BOE Gov Bailey Speaks
  • GBP BOE Gov Bailey Speaks
  • USD CB Consumer Confidence
  • USD Richmond Manufacturing Index
  • AUD CPI y/y
  • USD Pending Home Sales m/m
  • EUR German Prelim CPI m/m
  • EUR Spanish Flash CPI y/y
  • USD Final GDP q/q
  • USD Unemployment Claims
  • USD Final GDP Price Index q/q
  • CHF Gov Board Member Maechler Speaks
  • USD Treasury Sec Yellen Speaks
  • JPY Tokyo Core CPI y/y
  • CNY Manufacturing PMI
  • CNY Non-Manufacturing PMI
  • EUR ECB President Lagarde Speaks
  • EUR CPI Flash Estimate y/y
  • EUR Core CPI Flash Estimate y/y
  • CAD GDP m/m
  • USD Core PCE Price Index m/m
  • USD Chicago PMI
  • USD Revised UoM Consumer Sentiment

For more information and details see the TIOmarkets economic calendar.

Trade Safe!

Janne Muta
Chief Market Analyst

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Janne Muta

Janne Muta holds an M.Sc in finance and has over 20 years experience in analysing and trading the financial markets.

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