SWEDEN: CPIF ex-energy Inflation Soft, But No Details Available
- MNI: SWEDEN FLASH NOV CPIF +2.27% Y/Y (vs 3.07% prior, 2.09% Riksbank, 2.5% cons)
- SWEDEN FLASH NOV CPIF EX-ENERGY +2.36% Y/Y (vs 2.76% prior, 2.45% Riksbank, 2.6% cons)
November flash CPIF ex-energy inflation was two tenths below consensus on a rounded basis and one-tenth below the Riksbank’s September MPR forecasts. That’s notable given underlying inflation was tracking two tenths above the September projections in October. The “low” unrounded reading adds to the downward surprise.
- That said, there’s little net impact in SEK FX – the inflation reading doesn’t change the near-term Riksbank outlook. The policy rate is likely to be kept on hold at 1.75% for “some time”.
- After a string of stronger-than-expected growth data since September, today’s inflation reading will provide some offset in terms of expected December MPR rate path revisions. On net, we still expect an upward revision.
- We will be most focused on whether such a revision is seen in the first three quarters of the December path (i.e. the part of the curve that is “owned” by the Executive Board, and the primary policy signal).
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GILT TECHS: (Z5) Trading Above Support
- RES 4: 94.60 1.764proj of the Sep 3 - 11 - 26 price swing
- RES 3: 94.24 1.618 proj of the Sep 3 - 11 - 26 price swing
- RES 2: 94.00 Round number resistance
- RES 1: 93.96 High Oct 28
- PRICE: 93.37 @ Close Nov 3
- SUP 1: 93.15 Low Oct 27
- SUP 2: 92.81 20-day EMA
- SUP 3: 92.38 Low Oct 20
- SUP 4: 92.07 50-day EMA
The trend structure in Gilt futures remains bullish. Moving average studies are in a bull-mode position, highlighting a dominant uptrend. The next upside objective is 94.00. Clearance of this level would open 94.24, a Fibonacci projection. Note that the contract is overbought, a short-term pullback would allow this trend condition to unwind. Initial firm support to watch 92.81, the 20-day EMA.
USDJPY TECHS: Trend Structure Remains Bullish
- RES 4: 155.89 High Feb 3
- RES 3: 155.53 2.00% retracement of the Jan 10 - Apr 22 bear leg
- RES 2: 154.80 High Feb 12
- RES 1: 154.48 Intraday high
- PRICE: 153.64 @ 06:58 GMT Nov 4
- SUP 1: 153.27 High Oct 10
- SUP 2: 152.06 20-day EMA
- SUP 3: 150.28 50-day EMA
- SUP 4: 149.38 Low Oct 17
The trend condition in USDJPY remains bullish and the pair is trading closer to its recent trend highs. The break higher last week confirmed a resumption of the uptrend and note too that moving average studies are in a bull-mode position, highlighting a dominant uptrend.Sights are on 154.80, the Feb 12 high. First important support to watch lies at 152.06, the 20-day EMA. A pullback would be considered corrective.
EQUITY TECHS: E-MINI S&P: (Z5) Approaching Support
- RES 4: 7000.00 Psychological round number
- RES 3: 6993.12 3.500 proj of the Aug 20 - 28 - Sep 2 price swing
- RES 2: 6974.04 3.382 proj of the Aug 20 - 28 - Sep 2 price swing
- RES 1: 6953.75 High Oct 30 and the bull trigger
- PRICE: 6818.75 @ 06:42 GMT Nov 4
- SUP 1: 6804.03 20-day EMA
- SUP 2: 6698.11 50-day EMA
- SUP 3: 6571.25 Low Oct 17
- SUP 4: 6540.25 Low Oct 10 and a key short-term support
The trend condition in S&P E-Minis is unchanged, it remains bullish and the latest pullback appears corrective. Attention is on support at the 20-day EMA, at 6804.03. A clear break of this level average would signal scope for a deeper retracement and expose the 50-day EMA at 6698.11 - a key pivot support. The bull trigger has been defined at 6953.75, the Oct 30 high. Clearance of this hurdle would confirm a resumption of the uptrend.
