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Economic Indicators Released Overnight
Initial Jobless Claims kept markets up despite CPI and ECB hold. Everything's converging on Powell needing to cut 50bps.
Anything less will disappoint.
US Equities
Mexico Plans 50% Tariff on Chinese Cars Before US, Canada Talks [Bloomberg]
Neckline is broken to the upside. Needs to confirm of course. 117.5k and above breaks the current market structure and looks to bring into play the inverse head and shoulders formation targeting 150k.
A pause was definitely needed after such an epic run. A move back to 3,500 is where we need to go to get the energy for the next big move, up to 4,000. Both look a long way away but I’m sure Comrade Powell has something up his sleeve.
DXY can’t sustain any sort of rally, and the grim reaper beckons. 15 year uptrend could get broken on Wednesday. Or not.
More downside in yield but wick suggests that’s all for now. A rapid 30bps move down on top of FED easing suggests 50bps cut now baked into the price.
US 10 Year Government Bond Yield Daily
Maybe a pause in the amazing Chinese equity rally. Don’t bet on it as flows leaving the US accelerate.
SHANGHAI COMPOSITE Daily
Trump’s ‘legendary’ MAGA youth influencer shot dead [AFR]