Forex Today: Stocks Continue to New Record Highs Led By AI

Global stock markets are rising to new all-time highs led by tech, especially in the USA, South Korea, and Japan.

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1. The major story in the financial markets continues to be the steady advance of global stock markets to new all-time high prices led by technology stocks, notably the AI sector. The major indices in Japan (the Nikkei 225 Index) and South Korea (KOSPI Composite) rose firmly today to make new highs, while futures off-hours on US indices, notably the NASDAQ 100 Index, did the same. This is a great time to be long of stocks, especially tech and AI stocks, and trend traders will already be positioned this way. As it is the first day of a calendar month, rises later today could be especially strong. Stock markets are mostly filtering out noise over the USA / Iran standoff.
2. Crude Oil has gained today on the Iranian attack against Kuwait overnight, and US Centcom's statement that it attacked military facilities in Iran over the weekend. Despite the back-and-forth low-key strikes, the ceasefire holds, with President Trump talking up the prospect of a deal one minute while threatening to return to kinetic war if a deal is not concluded. Of course, Trump has been saying this for about two months now, so few truly believe he is seriously prepared to resume the war, which is why Iran will keep talking to run out the clock until Trump's position weakens even further. This is bad news for anyone who wants to see Iran prevented from obtaining a nuclear weapon, but good news for stock markets, inflation, and the global economy over the short-term.
3. In the Forex market, since today's Tokyo open, the strongest major currency has been the British Pound, while the weakest has been the New Zealand Dollar. The US Dollar is hardly moving.
4. Crypto is looking generally bearish, with Bitcoin showing bearish price action today and looking likely to test its 6-week low near $72k. The weakness of crypto while technology stocks are rising to record highs is very telling, and the tell is not good news for crypto investors. This is a sector I will be avoiding at this time.
5. There will be a release today of US ISM Manufacturing PMI data.

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