Stock market sentiment remains supported ahead of the US inflation report, with markets starting to look past the current wave of tightening moves and buying into hopes that final rates will be reached sooner rather than later this year. Yields have come down and stocks are benefiting. Australia and New Zealand bonds bounced today with yields stabilizing after being pushed up by stronger than expected local inflation data yesterday.
The USDIndex is tumbling between 102.60-103.20 for a 3rd consecutive day. EUR – rallied to 7-month low to 1.0777. JPY – got a boost today on speculation about BOJ stimulus tweak heading into next week’s policy meeting. Currently traded at 131.80 amid wider strength in the yen. GBP – reversed from 1.2170. Stocks – US indices are up since yesterday amid bets that a mitigation in the pace of U.S. consumer price gains will allow the Federal Reserve to dial back the pace of its rate hikes.The US100 spiked to 11489, breaking 50 DMA, US30 to 34134 and US500 to 3994. GER40 and UK100 futures are posting gains of 0.2% and 0.3% respectively.USOil – it’s been a rollercoaster for oil, having climbed over $77 on optimism on China’s reopening. Then fell to below $76 on the huge build in inventories, but then manage to extend gains above $78. That is the third largely weekly increase on record (dating back to 1982), and a big miss from analyst expectations for a small decline. Gold – steady below $1885.
Today – US Inflation release.
Biggest FX Mover @ (07:30 GMT) ETHUSD (+4.62%). Spiked to 1417.35, breaking W-pattern neckline at 1353. Fast MAs & RSI flattened but MACD histogram & signal lines remain positive. H1 ATR 13.75, Daily ATR 37.86.
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Andria Pichidi
Market Analyst
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