Details Cookies
Important margin product information
CFDs and forex spot transactions are complex instruments and come with a high risk of losing money rapidly due to leverage. 76% of retail investor lose money when trading CFDs and/or forex spot with this provider. 0.42% of retail clients trading in leveraged products experience a negative account balance after a stop out occurred. You should consider whether you understand how CFDs, forex spot transactions or any of our other products work and whether you can afford to take high risk of losing your money.
Cookie policy

This website uses cookies to offer you a better browsing experience by enabling, optimising and analysing site operations, as well as to provide personalised ad content and allow you to connect to social media. By choosing “Accept all” you consent to the use of cookies and the related processing of personal data. Select “Manage consent” to manage your consent preferences. You can change your preferences or retract your consent at any time via the cookie policy page. Please view our cookie policy here and our privacy policy here

Market Quick Take - March 25, 2021 Market Quick Take - March 25, 2021 Market Quick Take - March 25, 2021

Market Quick Take - March 25, 2021

Macro 4 minutes to read
Saxo Strategy Team

Summary:  The US equity market posted a weak session across the board, with the major averages eyeing important local support and elsewhere, small-cap stocks are in a nosedive. The mood stabilised overnight. US treasury yields were stable after an indifferent 5-year treasury auction and the US dollar remained firm after EURUSD broke to a new four-month low.

What is our trading focus?

Nasdaq 100 (USNAS100.I) and S&P 500 (US500.I) – US equities turned sharply lower and across the board yesterday (contrasting with the divergences noted yesterday) led lower by e-commerce, bubble stock and biotechnology. This took the Nasdaq 100 Index close to the local pivot low of12,681 that could open for a test of 12,200 if broken, while the tactical downside focus for the S&P 500 of 3,875 (also a recent low as well as the 21-day moving average) a break there could lead to a test of the last important Fibo retracement (61.8% at 3,813)

Bitcoin (BITCOIN_XBTE:xome) and Ethereum (ETHEREUM_XBTE:xome) - It has been a volatile 24 hours for Bitcoin, which rallied sharply yesterday to above 57k, possibly on the news that Tesla announced that customers could pay for cars in Bitcoin, before falling again overnight as far as almost 51.5k. The 50k area on the chart looks important technically and likely also psychologically. Ethereum price action mimicked that of Bitcoin – with the next key chart area lower 1300-1400.

USDJPY – the consolidation in USDJPY has been very shallow and has largely tracked the consolidation lower in US treasury yields. The yield-sensitive JPY bears watching over US data today (weekly claims) and the 7-year US treasury auction as a new rise in US yields could see USDJPY popping the top on new highs and making a run at the critical chart (and psychological) level of 110.

EURUSD – the big USD pair has now broken lower below the prior 1.1835 low and thus has traded to four-month lows, with the chart area toward 1.1600 now opened up. The market brushed off the strongest ever Manufacturing PMI reading out of Germany yesterday, and the USD may continue to outperform as long as growth expectations continue to stretch in favour of the US.

Gold (XAUUSD) continues to trade sideways while silver (XAGUSD) remains at risks of a deeper sell-off on a break below $25/oz as HG Copper (COPPERMAY21) fundamentals weaken with exchange-monitored inventories up 80% from last month’s more-than  decade-low. The metals have struggled all week with the tightest (inverse) correlation being that against the dollar which has broken higher (see above). Yields meanwhile have behaved favorably with 10-year real yields trading at –0.70%, but not enough to halt the outflows from ETF’s which for gold has been ongoing for the past 27 days. We remain short-term neutral below $1765 with the risk of additional weakness below $1720.

Crude oil (OILUKMAY21 & OILUSMAY21) bounced strongly yesterday before running into fresh selling overnight in Asia. The Suez blockage, now in its second day, is currently disrupting flows of oil and products, estimated to be around 2 million barrels/day. The bounce from Tuesday’s low near $60/b also a reflection of a growing unease that OPEC+ may add further measures to support prices when they meet on April 1. Friday’s COT data from the CFTC will show how much money managers cut longs during the latest correction. For now, the market remains on the defensive with a break above $65 needed to improve the short-term outlook.

What is going on?

UK Bank of England Chief Economist suggests UK could see “rip-roaring” recovery as he pointed to the savings UK consumers put away during the pandemic as the government rolled out an unprecedented fiscal response. This is the key question for this economy and the US economy, the two large economies that were both the most aggressive with fiscal stimulus and that lead the race to vaccinate their populations.

SEC opens inquiry into SPAC frenzy. SPACs have become a popular method to list new companies in the US. A SPAC is a shell company listed on the stock exchange with only cash on the balance sheet and intentions to do an acquisition within some defined industry. Read the entire SEC inquiry here.

Container ship still blocking Suez Canal – halting close to $10 billion a worth of ship traffic daily and currently a total 185 ships are waiting to transit. While the oil and fuel market has received most of the attention, the bulk and container markets are likely to see the biggest impact. Container freight rates from Shanghai to Rotterdam surged during Q4-20 and has stayed elevated at 4 times the normal rate, and it could go even higher in the short term.

What are we watching next?

U.S. growers may plant their largest area since 2014 this coming summer. During the past year the Bloomberg Grains index has jumped by more than one-third with soybeans (+58%) and corn (+45%) trading at their highest levels in seven years. While it may take 5-10 years for mining companies to raise production in response to higher prices, farmers can respond from one year to the next. The U.S. Department of Agriculture will release its plantings outlook on March 31, and weather permitting, a bumper crop is expected with surveys pointing to increased acreage allocation for soybeans and especially corn. Speculators hold a near record long so expect increased volatility before and after the release.

US Treasury Yields and 7-year US Treasury auction today. Yields were almost unchanged yesterday after the 5-year Treasury auction proved rather indifferent, with a slight pick up in the rather low bid-to-cover ratio of the prior auction of this maturity, while there was little change in foreign interest. The 7-year auction up today could receive even more focus as it was a disorderly market around the last 7-year auction result that sparked a significant rise in US yields. Quarter-end portfolio rebalancing is seen by some as a possible support for fixed income through March 31.

EM currencies after Russia cancels bond auction, South African auction sees weak demand - some are tempted to draw a line of association to Turkey, where President Erdogan’s firing and replacement of the central bank head has triggered a meltdown in the lira, but there are no signs of strain in EM credit spreads in general here. The Ruble move lower does look quite large and could be linked to concerns of eventual US sanctions. The South African rand is only slightly lower after weak demand at a sovereign bond auction yesterday, and the Reserve Bank of South Africa meets today.

Earnings to watch - another batch of earnings announcements out of China today and tomorrow as we watch whether mainland Chinese equities and the Hang Seng Index can find more support after their recent significant correction.

  • Today: China Mobile, China Life Insurance, China Evergrande New Energy, Nongfu Spring, CNOOC, Anhui Conch Cement, China CITIC Bank, Country Garden
  • Friday: China Construction Bank, China Petroleum & Chemical, China Shenhua Energy, Bank of Communications, Longfor Group, Meituan

Economic Calendar Highlights for today (times GMT)

South Africa Central Bank Rate Announcement (no time given)
0830 – Switzerland SNB Deposit Rate Announcement
0830 – Sweden Feb. Household Lending
0900 – ECB President Lagarde, other ECB officials speak at BIS conference
0930 – UK BoE Governor Bailey to Spek at BIS Conference
1230 – US Weekly Initial Jobless Claims
1410 – US Fed Vice Chair Clarida (Voter) to speak on Economy and Monetary Policy
1430 – US Weekly Natural Gas Storage Change
1500 – US Mar. Kansas City Fed Manufacturing
1700 – US 7-year Treasury Auction
1900 – Mexico Central Bank Rate Announcement
2300 – US Fed’s Daly (Voter) to speak


Follow SaxoStrats on the daily Saxo Markets Call on your favorite podcast app:

Apple Sportify Soundcloud Stitcher


The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (
Full disclaimer (
Full disclaimer (

Saxo Bank (Schweiz) AG
Beethovenstrasse 33

Contact Saxo

Select region


All trading carries risk. Losses can exceed deposits on margin products. You should consider whether you understand how our products work and whether you can afford to take the high risk of losing your money. To help you understand the risks involved we have put together a general Risk Warning series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. The KIDs can be accessed within the trading platform. Please note that the full prospectus can be obtained free of charge from Saxo Bank (Switzerland) ltd. or the issuer.

This website can be accessed worldwide however the information on the website is related to Saxo Bank (Switzerland) Ltd. All clients will directly engage with Saxo Bank (Switzerland) Ltd. and all client agreements will be entered into with Saxo Bank (Switzerland) Ltd. and thus governed by Swiss Law.

The content of this website represents marketing material and has not been notified or submitted to any supervisory authority.

If you contact Saxo Bank (Switzerland) Ltd. or visit this website, you acknowledge and agree that any data that you transmit to Saxo Bank (Switzerland) Ltd., either through this website, by telephone or by any other means of communication (e.g. e-mail), may be collected or recorded and transferred to other Saxo Bank Group companies or third parties in Switzerland or abroad and may be stored or otherwise processed by them or Saxo Bank (Switzerland) Ltd. You release Saxo Bank (Switzerland) Ltd. from its obligations under Swiss banking and securities dealer secrecies and, to the extent permitted by law, data protection laws as well as other laws and obligations to protect privacy. Saxo Bank (Switzerland) Ltd. has implemented appropriate technical and organizational measures to protect data from unauthorized processing and disclosure and applies appropriate safeguards to guarantee adequate protection of such data.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.