The tech giant is expected to report strong growth on top and bottom lines for the third quarter. GOOGL stock rose 2% on the day ahead of its upcoming earnings. 

WHAT SHOULD TRADERS BE FOCUSED ON? 

With Alphabet Inc.’s earnings approaching, traders should zero in on core areas to evaluate the company’s momentum and future outlook. Here’s what you need to know heading into Alphabet’s earnings. 

• Revenue growth: Alphabet achieved revenue of $84.74 billion in the latest quarter, a 14% year-over-year increase driven by Google Search, YouTube Ads, and Google Cloud. 

• Profit margins: Alphabet’s operating margin improved to 32.36%, reflecting effective cost management and operational efficiency. 

• Advertising revenue: Google Search and YouTube both saw growth, with AI enhancements boosting search engagement, and YouTube seeing gains in watch time, Connected TV viewership, and Shorts monetization. 

• Cloud business performance: Google Cloud exceeded $10 billion in quarterly revenue and reached $1 billion in operating profit, growing 28.84% due to rising demand for AI and generative AI infrastructure. 

• Guidance and outlook: Alphabet is focusing on cost efficiency and prioritizing investments in high-growth areas, particularly AI, to drive future growth. 

• Regulatory and legal issues: Alphabet faces various global regulatory challenges, including investigations and lawsuits related to AI competition, free speech concerns, and partnerships with rival firms. 

MARKET EXPECTATIONS 

Earnings Per Share (EPS): $1.84 

Revenue: $86.23 bn 

Despite a cooling AI market, investors remain keen on Alphabet’s progress in integrating AI across its platforms, especially following the merger of Google Research and Google DeepMind to drive AI innovation.  

While Alphabet exceeded Q2 earnings expectations, its stock dipped by 5% on July 24 due to cautious guidance, sparking concerns over returns on its growing AI investments, with R&D expenses reaching $23.8 bn as of June 30. 

Like a lot of growth stocks in the last three months, GOOGL has underperformed as multiple worries loom over growth stocks and the broader stock market in general, which has tempered expectations coming into Q3 earnings results. 

GOOGL stock is prone to strong volatility in response to earnings. Alphabet’s long-term outlook should be carefully considered by traders and investors, and they should be ready for sudden movements during the earnings announcement.  

TECHNICAL ANALYSIS 

Since August 6, GOOGL has been trading in a range, reaching a low of $148 before rebounding and stabilizing near $160. Traders are eyeing key levels as earnings approach. Positive results could lift the stock toward the next resistance around $172, while weaker-than-expected figures may increase selling pressure, potentially moving the stock toward support near $153.4. Observing how the stock reacts around these levels can provide insights into market sentiment following the earnings release. 

The post Alphabet Q3 Earnings: What to Expect  appeared first on Daman Markets.

The USD has been outperforming the markets this week, bolstered by solid economic data that has boosted demand for the dollar against other major currencies.  

Despite the strong data, the USD remains close to its intraday low. 

Mixed Signals from PMI Data 

The latest flash S&P Global PMI report for October delivered mixed signals. The Services PMI, which measures activity in the services sector, came in at 55.3—a surprising jump, as economists had expected a slight dip from 55.2 in September to 55.0.  

This rise indicates a stronger-than-anticipated growth in the U.S. service sector, which could signal increased economic resilience. 

In contrast, the Manufacturing PMI contracted for the fourth month in a row, though the pace of decline was slower than expected. The index registered at 47.8, below the 50-point threshold, which separates expansion from contraction. 

Decline in Jobless Claims Supports USD 

In the labor markets, Initial Jobless Claims rose to 227K, down from the previous week’s 242K, reinforcing the USD’s strength.  

Fewer jobless claims typically reflect a healthier labor market, which can support the dollar by raising expectations for continued economic stability. 

Election Impact 

The USD has also benefited from rising market expectations around the U.S. presidential election. Growing speculation of a potential victory for Republican candidate and former president Donald Trump has fuelled demand, as his policies are anticipated to be inflationary, such as tariffs that could impact trade and prices. 

Meanwhile, ongoing uncertainty surrounding the election has bolstered the dollar’s role as a safe-haven asset. Traders and investors often turn to the USD during periods of political or economic uncertainty, further supporting its value. 

Japan and Eurozone Developments 

In Japan, markets doubt whether the Bank of Japan (BoJ) will hike interest rates again after slightly dovish guidance from Governor Kazuo Ueda. 

Ueda indicated that the BoJ needed more time to gain confidence on inflation going down below 2%. 

In Europe, stronger-than-expected German PMI data provided a temporary boost to the euro, pausing its recent decline against the USD.  

Markets are watching to see if this could lead to a corrective bounce for EUR/USD following its downward trend since late September.  

However, the gains are unlikely to alter the European Central Bank’s dovish stance, as active rate cuts are still anticipated in the near term. 

Technical Analysis 

The DXY pulled back on Thursday after forming new highs and breaching resistance. The DXY has broken above 104.00 and is in an empty area that could quickly see 105.00 emerge as the first cap on the upside. In case prices turn bearish, support around 103.4 could come into effect. If buyers fail to take control and price breaks below 104, then we might see a shift in the trend. Price also formed a double top with the August 2 high, a potentially bearish indicator. 

The post USD Outperforms as Strong Data Drives Demand  appeared first on Daman Markets.

Despite the hype around self-driving taxis, most of Tesla’s revenue and profits still come from car sales, prompting analysts to watch for signs of growth in this area. 

What should traders and investors focus on? 

• Recent price reductions’ effects on profit margins 
• Developments in the Robotaxi project 
• Information on regulatory approvals and advancements in full-self-driving technology 
• Forecast for deliveries in Q4 2024 and the entire year of 2025 

Expectations 

Revenue: $25.54 billion 

Earnings per share (EPS): $0.60 

Historical data shows that Tesla’s stock tends to surge after positive earnings announcements. However, if earnings miss, this could cause the stock to take a hit. 

One thing’s for sure. TSLA stock is highly volatile around earnings. While short-term gains are possible, so are significant drops. Traders and investors should carefully consider Tesla’s long-term outlook and be prepared for sharp moves during the earnings periods. 

Technical analysis 

Since the Robotaxi event, Tesla’s stock price has been struggling. It breached support which has now turned into resistance at $225.82.  

A miss in Tesla’s earnings report could place its stock under more pressure. 

However, if the earnings report beats estimates, could this be enough to see Telsa’s share price rebound? 

The post Can Tesla’s Earnings Fuel a Rebound for the Stock?  appeared first on Daman Markets.

With the U.S. elections just around the corner and ongoing tensions in the Middle East, investors are flocking to gold—considered the ultimate safe-haven asset. 

Adding to this, a supportive monetary policy environment is helping offset rising U.S. bond yields, further fueling the precious metal’s surge. 

Yesterday, gold pulled back slightly from its new high of $2,740, but the bulls look to be back in control, driving prices upward despite overbought signals in the RSI.  

The next key milestone? $2,750 potentially. However, if gold struggles to hold its momentum, we could see a retracement to the major support level at $2,695. 

The U.S. Dollar, meanwhile, eased during the Asian session, along with Treasury Yields. 

This retreat opened the door for gold to rally, as market caution grows ahead of major U.S. earnings reports and the uncertainty surrounding the upcoming U.S. presidential

The post Gold Eyes New Highs as U.S. Dollar Pauses  appeared first on Daman Markets.