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‘Meme stocks’ plummet, Bezos steps down

EUR/USD – Daily Candlesticks
Source: GKFX / MT4 (February 3, 2021)

EUR/USD has dropped to a 2-month low, falling through recent support near 1.205 and down to 1.2011 the high from September 1. A long wick on the daily candle suggests some buying interest in the area. Should the decline continue, next support lies near 1.1915, the November 9 high.
 

TAKEAWAYS


•    GameStop plunges by 60% as the short-squeeze unwinds in biggest decline ever
•    Other ‘most-shorted’ and popular Reddit meme stocks including AMC drop sharply
•    Silver dives 10% as short-squeeze attempt implodes, but paper-physical gap remains
•    EUR/USD hits 2-month low
•    Wall Street jumps in best day for Dow since November
•    Amazon reports record revenue and announces Jeff Bezos will step down as CEO
•    Google-parent Alphabet hits record high, beats earnings expectations
•    WTI crude oil reaches $55 pb for first time post-pandemic
•    DAY AHEAD: Services PMIs, Eurozone CPI, ADP employment


 

GURU WISDOM


"Given a 10% chance of a 100 times payoff, you should take that bet every time." — Jeff Bezos
 

MARKETS


*Daily closing price
↘ EUR/USD    1.2043        (-0.13%)
↗ GBP/USD    1.3665        (+0.05%)
↗ USD/JPY    103.77        (+0.08%)
↗ S&P 500    3826.31    (+1.39%)
↗ Hang Seng    29.248.70    (+1.23%)
↘ Gold        1838.06    (-1.19%)
↗ Oil (Brent)    57.81        (+2.59%)
↗ Bitcoin    35,856        (+6.84%)
 

NEWS

Bezos out


Amazon founder Jeff Bezos will step down as CEO in the third quarter, transitioning to a new role as Executive Chairman. Andy Jassy will succeed him. Bezos will reportedly use his time to focus on his Day1 charitable fund, Blue Origin and other passions. Nice for him. The timing was well done in a big first $100 billion quarter for Amazon, meaning investors are celebrating the results rather than fretting his absence. Notably, Bezos is not leaving Amazon and will still have a big influence on the company’s future.
 

EUR/USD


The US dollar continues to gain traction, with DXY hitting a 2-month high, while EUR/USD is at 2-month lows. The dollar gains come as focus returns to the next US covid stimulus bill and the prospect of relatively higher yields in the US than in Europe. 
 

Silver crashes


XAG/USD has wiped out gains from the last two trading days and could soon be back to where it started on Thursday when WallStreetBets first pumped the idea of a short-squeeze. 
 

Meme stocks


The drop in GameStop, AMC, Nokia and other widely-watched ‘meme stocks’ seemed to match a rise in broader markets. As we noted yesterday, much of the short interest has already come out of the stocks, removing the basis for the trade. Still, with restrictions removed in some US online brokers, attempts to push the stock back could continue. 
 

DAY AHEAD 


*Times in GMT
01:45 – China Caixin Services PMI(Jan) [51.1 Exp vs. 56.3 Prev]
08:55 – Germany Markit Services PMI(Jan) [46.8 Exp vs. 46.8 Prev]
09:30 – UK Markit Services PMI(Jan) [38.8 Exp vs. 38.8 Prev]
10:00 – Eurozone Consumer Price Index (YoY)(Jan) Prel [0.5 % Exp vs. -0.3 % Prev] 
13:15 – US ADP Employment Change(Jan) [45 K Exp vs. -123 K Prev]
15:00 – US ISM Services PMI(Jan) [56.8 Exp vs. 57.7 Prev]