September closed on a 6.9% profit, which is an excellent result given the small losses we had to take and the unpredictability of the market in the final week. I want to make this point to everyone: although we have a flawless track record showing every month of realised profit, we also take losses to protect the fund further and the trades we have open within it.
As we see the close of year two and the successful completion of September, let us all take a moment to reflect on what with your support what, we have achieved…
Novus Black is now 25 months old and has successfully produced continuous monthly profits. We have grown from a small private club with £150,000 of our own capital to a regulated investment fund with over $7m under management. We have navigated some of the most treacherous waters in financial history and have kept our flawless track record despite everything. On top of this, we have rolled out 2 new system updates, raised a lot of money for worthwhile causes, and expanded our valued client base. So, with this in mind, and on behalf of all of us at Novus Black, thank you to everyone, and we look forward to much more success in the future.
As we venture into year three, we are mindful that despite a fantastic track record, we still have to adapt and make changes to enhance the product further. With this in mind, I am pleased to announce that the new Novus Black app is in its final stage of testing and will be available to download imminently.
Steve Hill – CEO
September Overview
Last month, the markets exhibited significant trends and fluctuations across various asset classes. Here’s a summary of where the markets ended and our forecast for the month ahead:
Currency Markets
The US Dollar Index (DXY) demonstrated strength, closing the month at 106.18. This marked its eleventh consecutive week of gains. The primary influence on the dollar’s performance was quarter-end rebalancing flows, causing increased volatility.
Major currency pairs, including GBP/USD, EUR/USD, AUD/USD, and NZD/USD, experienced a notable decline. These pairs entered an oversold territory, historically considered a robust support zone for the British pound and other currencies.
The ECB raised interest rates to record highs on Thursday 14th but said this was likely the final increase and it now intends to maintain current levels in an extended pause. The EUR/USD dropped reaching 1.0490 a 9 month low level, following the European Central Bank’s decision to raise its policy rate by 25 basis points and its continued pessimistic outlook.
UK economic pointers have deteriorated in recent months, owing to high inflation, and rising borrowing costs. But wages have continued to rise sharply, as workers demand higher pay. Given both wage growth and services inflation – the two key metrics upon which the BoE is basing policy – are higher than forecasted back in August. The Bank kept its options open for November, but on September 21st meeting maintained on hold its interest rate at 5.25%.
Gold faced a challenging month, falling by 4% and closing at $1,848 per ounce. The decline in gold prices was driven by traders liquidating weak long positions in response to rising global bond yields.
October Forecast
Currency Markets
The decline in currency values against the USD can be attributed to short-term market dynamics, the dollar’s recent moves might be overextended. Despite widespread expectations of a potential U.S. recession this year, the economy has proven considerably more resilient than anticipated by many on Wall Street amid a solid labor market and robust consumer spending.
This continuous increase in the dollar index, the longest in the last nine years, is largely underpinned by the expectation that the Federal Reserve will maintain high interest rates through 2024. Additionally, the US economy exhibits more resilience compared to other economies, benefiting from positive trends in employment, inflation, and energy prices.
The oversold condition of major currency pairs like GBP/USD, EUR/USD, AUD/USD, and NZD/USD may lead to short-term rebounds. However, this should be seen as a correction within a broader trend of USD strength.
Gold prices may remain under pressure as long as global bond yields continue to rise. Investors should closely monitor yield movements and their impact on precious metals.
As we head into the month of October, there are several key events and economic indicators that will be closely monitored in the developed markets. These events have the potential to impact financial markets and investor sentiment. Let’s take a closer look at the major events to watch out for:
- The Reserve Bank of Australia (RBA) interest rate decision
- The Reserve Bank of New Zealand (RBNZ) interest rate decision
- The European Central Bank (ECB) interest rate decision
- The Bank of Canada (BOC) interest rate decision
- The Bank of Japan (BOJ) interest rate decision
In summary, the past month saw the US dollar strengthening while various markets experienced fluctuations. As we step into October, the forecast indicates the possibility of short-term rebounds in major currency pairs.
AUM Increase
We have been working hard on building and nurturing new partnerships and relationships and, as a result of our efforts, now have an AUM of over $7m. Thanks to a series of successful business trips and deals within them coming to fruition, we expect significant advances with this figure over the coming weeks and months. We will keep everybody updated throughout our journey.
Mini CEO
I wanted to thank everybody for the support and kind messages for the birth of my new son. Henry is now just over one month old, and everybody is doing exceptionally well; however, missing out on a bit of much-needed sleep.
