Moderna vaccination news that brought the price gold down yesterday supported commodity currencies and stocks as well as the price of oil in yesterday’s trading. As US stock indices are trading near recent highs their gains remained subdued but the shares in vaccine maker Moderna rose by 9.58%. Moderna shares have gained 45.2% this month. Pfizer, the other company reporting of successful vaccination tests has seen its stock slide since the initial euphoria. Today’s macroeconomic risk events include monetary policy meeting minutes from the RBA and retail sales numbers from the US. By reading further you agree with our disclaimer at the bottom of this page and acknowledge that we do not provide investment advice.

Pfizer (PFE) shares have declined 11.5% since the publication of the vaccination news. Moderna reports that their vaccine doesn’t need the ultracold storage temperatures the Pfizer vaccine needs, but can be stored in a refrigerator. This makes the latter product much more viable for global distribution. Pfizer, however, has large pre-orders from big entities such as the European Union and the recent slide in the share price might be overdone. It’s worth remembering that PFE  is also a big blue-chip and a DJIA component with strong institutional support. Shares are getting oversold in the daily timeframe as per Stochastics Oscillator (5.3.3) and are nearing the lower end of the gap which means that PFE is trading near the pre-vaccination news levels. This could result in a short-term trading opportunity on the long side. The two-hour chart reveals a bullish wedge and projection based on the wedge suggests the price could provide a sizeable (>5%) move if the price breaks out of the channel. The risks in this trade idea include other major companies reporting their vaccines that don’t require ultracold storage and the indices being near their recent highs. We believe PFE has upside potential and is a buy candidate above the $36.08 support. As the stock is gappy (increased risk of slippage with stops) we are looking to adjust position sizing to reflect the additional risk. If we get a buy signal above 36.08 our T1 zone is at 38.95 – 39.50  and T2 at 41.08 – 41.90. For more analysis on this and many other markets, you may want to subscribe to TIOmarkets YouTube channel.

Recent macroeconomic data releases

  • New Zealand Official Cash Rate 0.25%, 0.25 expected
  • US CPI 0.0%, 0.1% expected
  • US Core CPI 0.0%, 0.2% expected
  • US Unemployment Claims 709K, 730K expected
  • US Core PPI 0.1%, 0.2% expected
  • US PPI 0.3%, 0.2% expected
  • Prelim UoM Consumer Sentiment 77.0, 82.1 expected
  • ECB Financial Stability Review

Macroeconomic data releases today

  • RBA Monetary Policy Meeting Minutes
  • OPEC-JMMC Meetings
  • US Core Retail Sales 0.6% expected
  • US Retail Sales 0.5% expected
  • BOE Gov Bailey Speaks
  • Fed Chair Powell Speaks

You may access the times and dates in the economic calendar here.

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Janne Muta
Chief Market Analyst
TIOmarkets.com

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