The XJO is expected to edge higher this morning following a small intraday bounce in the U.S overnight which saw their market finish practically flat. Their futures are in the green.
The U.S seems to be hanging around their key support, as they await the CPI decision tonight. Our market seems to be aware as well. Yesterday we managed to retake some of the previous session’s overshoot, but rebounded off 8,250 key resistance and gave up about a third of the morning’s gains. This morning we should retest 8,250, but it would be hard to expect much else heading into tonight.
It is hard to say where the market is heading to from here, as it will largely come down to how the U.S trades, and what their data looks like. Furthermore, Trump’s inauguration is next Tuesday so we should expect volatility to remain for the rest of the month.
US Markets
The U.S was mixed to flat overnight. The SP500 opened higher but sold off in their early session. They managed to claw back to finish marginally in the green, showing that they are not willing to give up just yet despite the bearish pressure.
PPI came in unexpectedly lower than the previous reading, adding to the tally of team “no rate-cut-pause”, and likely helping the index retake the intraday losses. Of course, the battle isn’t over. CPI is due tonight. The U.S is hanging on by the skin of its teeth and the reading tonight seems likely to tip them either way.
Utilities, Financials, Materials, Industrials, and Energy all rallied about 1% or more. Tech and Consumer Disc. was quiet. Health Care and Comm. Services fared the worst, dropping about 1%.
Technically the U.S has continued its short-term downtrend, having now either just created a lower trough, or in the process of doing so. It broke below the key support yesterday, and last night it seems they almost retested it as resistance. Regardless, the battle is being fought around these levels, with the decider likely coming from the CPI release tonight.
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