EQUITY TECHS: E-MINI S&P: (U5) Bulls Remain In The Driver’s Seat
- RES 4: 6523.63 1.764 proj of the May 23 - Jun 11 - 23 price swing
- RES 3: 6500.00 Round number resistance
- RES 2: 6477.31 1.618 proj of the May 23 - Jun 11 - 23 price swing
- RES 1: 6468.50 Intraday high
- PRICE: 6449.75 @ 14:27 BST Jul 31
- SUP 1: 6366.75/6329.36 Low Jul 30 / 20-day EMA
- SUP 2: 6288.25 Low Jul 17
- SUP 3: 6241.00 Low Jul 16
- SUP 4: 6181.96 50-day EMA
The trend set-up in S&P E-Minis remains bullish. A fresh cycle high today confirms a resumption of the uptrend and maintains the price sequence of higher highs and higher lows. Note that moving average studies are in a bull-mode position highlighting a clear dominant uptrend. Sights are on 6477.31, a Fibonacci projection. Key support is at the 50-day EMA, at 6181.96. Support at the 20-day EMA is at 6329.36.
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EUROPEAN INFLATION: M/M SA Services Inflation Still Above Q1 Average
Eurozone core inflation rose 0.27% M/M on a seasonally adjusted basis according to ECB data, up from -0.07% prior. Services prices rose 0.41% M/M (vs -0.14% prior), while non-energy industrial goods prices rose 0.03% M/M (vs 0.04% prior).
- The June inflation data was seen as a cleaner month to gauge underlying services inflation pressures, with April and May readings influenced by the timing of Easter and seasonal adjustment methodologies struggling to account for such calendar effects.
- In this light, the 0.41% M/M sequential reading was above the Q1 average of 0.29% and the 2024 average of 0.33%. From this perspective, there appears to still be some stickiness lurking in services prices. The final June inflation data on July 17 will shed more light on whether this is the case.
- 3m/3m annualised services inflation momentum was 4.07%, up from 4.00% in May and 4.06% in April.
- 3m/3m core inflation momentum was 2.66% Y/Y (vs 2.68% prior), but remains above March’s 2.34% Y/Y reading.
- ECB speakers continue to express confidence in the broader inflation outlook though. This morning, Bundesbank President Nagel said that “in the current situation, we are in calm waters”, with a similar rhetoric coming from Vice President de Guindos.
