Ripples of 2023: FBS's Insight on the 2024 Global Financial Outlook

FBS financial market analysts point out that next year, financial markets will stand at the cusp of transformation under the influence of the US economy, global and local military conflicts, and the sprawl of AI.

As FBS experts further stress, the cautious stance of the Federal Reserve on monetary policy and the rising cycle in 2023 weakened the US dollar, impacting major currency pairs like EURUSD. The FOMC press conference speech by Jerome Powell on the possible easing of US monetary policy in 2024 pushed EURUSD to the resistance at 1.1000.

FBS anticipates that economic growth will slow down to 2-3% due to monetary tightening in 2023 and geopolitical tensions impacting international trade. In this context, traders should consider volatile events and focus on risk management to mitigate stop-outs and losses.

FBS analysts describe 2023 as a time when traders faced multiple liquidation risks amid media-covered geopolitical and economic events. Global military conflicts heated market uncertainty and provoked gaps in XAUUSD and oil prices. By the end of the year, oil prices went down due to the anticipated deterioration of economic conditions in 2024, and gold prices experienced an upswing due to USD weakness, emphasizing the need for prudence during unpredictable news periods. The turbulence will likely continue in 2024, with oil prices fluctuating between $70 and $100 per barrel and gold rallying to $2,300 as investors will await the next inflation spike.

2023 was marked by optimism for the cryptocurrency market, FBS analysts point out. BTCUSD demonstrated remarkable strength, gaining over 120%. Cooling US inflation, anticipation of Fed rate cuts, and the collapse of tech-focused banks earlier this year contributed to Bitcoin's resilience. Speaking about the potential 2024 dynamic, FBS experts underscore the high incidence of a bearish trend in the first half of the year. Over the past weeks, Bitcoin has been going up to the resistance of $47,000. In this context, FBS analysts anticipate the recurrence of the 2019 events, when the Fed cut the key rate due to a weakening economy, which sent risky assets, like Bitcoin, down – this time, the asset may fall to the supports between $36,000 and $25,000. Although the second half of 2024 is expected to be positive for Bitcoin, crypto movement will hinge on regulatory changes, institutional adoption pace, and blockchain technology advancements.

The rise of artificial intelligence (AI) was another driver of 2023 and significantly influenced the stocks of AI-related companies. This way, NVIDIA's stocks experienced a remarkable increase by 165%. However, FBS analysts highlight their overbought nature and advise traders to monitor performance – if the per-share price exceeds $500, it will likely go up to the $700 level.

Emerging markets are expected to play a more significant role in the global economy in 2024, where Asia will be especially attractive. According to FBS analysts, traders can consider India, some Southeast Asian countries, and Brazil when planning their trades. These geographies are poised for significant growth, offering new investment opportunities and influencing global trade dynamics.

FBS's outlook on 2024 underscores the need for vigilance and strategic planning to navigate uncertainties and opportunities in trading. Careful consideration of the ripple effects of 2023 and emerging events will be critical in making informed decisions.