STIR: Fed Seen Cutting Next Week But Following Cut Not Until May
Dec-11 11:19
- Fed Funds implied rates are little changed overnight for Dec and Jan FOMC decisions although sit as much as 2.3bps higher for mid-2025 ahead of today’s CPI report.
- Cumulative cuts from 4.58% effective: 21.5bp Dec, 27bp Jan, 42bp Mar, 51bp May and 62bp Jun.
- Aside from an anticipated 25bp cut next week, the next fully priced 25bp cut is only just seen coming in May.
- The SOFR-implied terminal has also ticked another 2bps higher today. At 3.65%, it points to only a little over 90bp of cuts for the cycle (including next week’s decision).
- MNI US CPI Preview: https://media.marketnews.com/USCPI_Prev_Dec2024_b72e14af0a.pdf
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OPTIONS: Expiries for Nov11 NY cut 1000ET (Source DTCC)
Nov-11 11:14
- EUR/USD: $1.0700(E530mln), $1.0780-00(E1.1bln), $1.0850-70(E1.2bln), $1.1050-70(E1.7bln), $1.1100(E1.6bln)
- AUD/USD: $0.6650(A$608mln)
- USD/CAD: C$1.3740($1.3bln), C$1.4065($1.4bln)
USD: Testing broader highs
Nov-11 11:11
- The Dollar sees further upside continuation, at a fresh high against the EUR, GBP, ZAR, CHF, CNH, CAD, NOK, and SEK.
- EURUSD is through the noted support of 1.0666, and next immediate downside level is now at 1.0650 Low May 1.
- Next support in Cable is seen at 1.2834 Low Nov 06 and the bear trigger.
OUTLOOK: Price Signal Summary - S&P E-Minis Bull Cycle Extends
Nov-11 11:04
- In the equity space, bullish conditions in S&P E-Minis remain intact and last week’s gains reinforce current conditions. A key short-term support has been defined at 5724.25, Nov 4 low. The move higher last week resulted in a breach of the bull trigger at 5927.25, Oct 17 high, confirming a resumption of the primary uptrend. The 6000.0 psychological handle has been pierced. Sights are on 6070.16, 1.382 projection of the Sep 6 - 17 - 18 price swing. Initial support is at 5927.25, the Oct 17 high.
- A bearish theme in EUROSTOXX 50 futures remains intact and last week’s fresh cycle lows reinforces current conditions, having confirmed a resumption of the bear cycle. The contract has pierced 4815.50, the 50.0% retracement of the Aug 5 - Sep 30 bull cycle. This exposes 4757.00, the Sep 6 / 10 low and a key support. Initial firm resistance has been defined at 5015.00, the Oct 29 high, where a break would highlight a reversal. First resistance is at 4904.53, the 20-day EMA.
