Treasuries were more unidirectional while Yields have crept higher led by the long end. The curve has bear steepened to -65.6 bps from -68 bps Monday and -74 bps before Friday’s data. Wall Street was very choppy, trading either side of unchanged, after a positive opening. Chair Powell did not comment on policy matters in his Riksbank remarks. But Governor Bowman echoed hawkish comments from others of late. Gains had been shed as the market is pushed and pulled by crosscurrents of Fed policy dynamics, recession uncertainties, and upcoming earnings reports. Stock markets moved higher in Japan and Australia, the latter helped by stronger-than- expected retail sales numbers, which helped to balance the uptick in inflation that sparked fresh rate hike bets.
- The USDIndex bounced to 103.35 from a low of 103.03, adding to some of the volatility in stocks.
- EUR – ranging between 1.0700 – 1.0760.
- JPY – neutral, hovering around 132.30
- GBP – holds Friday’s gains. Range at 1.2110 – 1.2210.
- Stocks – The US100, US30 and US500 are fractionally higher with +1.01%, +0.56% and +0.7% respectively. US100 remains stuck in the 10800-11400 range. Note the fact we are getting tighter and tighter inside the triangle like formation. The 100-day SMA and the negative trend line are the big resistance levels to watch, while 10800 is the “must hold” level.
- USOil – fell by -0.48% to $74.66 per barrel and down from the $80.26 to end 2022.
- Gold – up at $1884.60.
Today – Crude Oil Inventories & New Zealand Building Permits.
Biggest FX Mover @ (07:30 GMT) XAGUSD (+1.46%). Spiked to R2: 23.93. MAs slightly higher, MACD histogram & signal line are close to zero. RSI 63 but flattened, H1 ATR 0.094, Daily ATR 0.589.
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Andria Pichidi
Market Analyst
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