US TSYS: Sell-Off Extends With Powell
Dec-18 19:50
- TYH5 has stepped another 5-6 ticks lower so far in Powell’s press conference rather than paring any post-announcement losses.
- It sets a new low of 109-06 as it starts to eye a bear trigger at 109-02+ (Nov 15 low).
- The curve has steepened so far in the presser, with 2s10s up to 15bps vs post-decision lows of 12.4bps.
- 2Y yields are 10.3bps higher since the decision/SEP (8bp on the day).
- 10Y yields are 8.5bps higher (7.3bp on the day, of which 7bp from real yields) at session highs of 4.470% with 4.50% in sights.
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COMMODITIES: Crude, Precious Metals Rally Amid Pullback In Dollar
Nov-18 19:33
- Crude has rallied, supported by the escalation in the Russia-Ukraine situation after President Biden permitted Ukraine to strike inside Russia with US missiles. A weaker USD on the day, with the Bloomberg dollar spot index down 0.4%, is also adding upside.
- WTI Dec 24 is up by 3.2% at $69.2/bbl.
- A bearish theme in WTI futures remains intact, with attention on $65.99, the Oct 1 low.
- On the upside, initial firm resistance is at $72.88, the Nov 7 high.
- Precious metals have also benefitted from the pullback in the dollar today, with spot gold rising by 1.8% to $2,609/oz.
- The move comes as Goldman Sachs reiterated its forecast for gold to reach $3,000/oz next year, noting that the recent sell-off provided an attractive entry point to buy the yellow metal.
- The long-term trend condition in gold remains bullish, with firm resistance seen at $2,653.2, the 20-day EMA.
- Meanwhile, silver is outperforming and is up by 2.7% at $31.1/oz.
- For silver, bullish conditions remain intact and the bear cycle that started on Oct 23 appears to be a correction - for now. Initial firm resistance to watch is $31.594, the 20-day EMA.
USDJPY TECHS: Corrective Pullback
Nov-18 19:30
- RES 4: 158.68 2.50 proj of the Sep 16 - 27 - 30 price swing
- RES 3: 157.86 High Jul 19
- RES 2: 156.88 2.236 proj of the Sep 16 - 27 - 30 price swing
- RES 1: 156.75 High Nov 15
- PRICE: 155.01 @ 16:40 GMT Nov 18
- SUP 1: 152.88 20-day EMA
- SUP 2: 150.63 50-day EMA
- SUP 3: 149.09 Low Oct 21
- SUP 4: 147.35 Low Oct 8
The USDJPY trend condition is unchanged, it remains bullish and Friday’s pullback is considered corrective. Last week’s gains confirmed a resumption of the uptrend that maintains the price sequence of higher highs and higher lows. Sights are on 156.88 next, a Fibonacci projection. Initial firm support is 152.88, the 20-day EMA. A clear breach of this EMA would signal the start of a corrective phase.
CANADA: Summary Of Analyst CPI Estimates
Nov-18 19:21
- Released tomorrow (Tue, Nov 19), consensus sees headline CPI firming three tenths to 1.9% Y/Y in October, back close to the 2% target mid-point having dipped below it in September for the first time (on a rounded basis) since early 2021.
- The BoC’s preferred core measures meanwhile are seen broadly unchanged at 2.4% Y/Y after 2.35% Y/Y, whilst a more traditional CPIxFE is seen easing to circa 2.2% Y/Y after two months at 2.36% Y/Y.
- The below table is taken from the MNI Canada CPI Preview, found here.
