31 Jan: Stock lower, US$ mixed as bond yields rise. Trump – SOTU, FOMC ahead. Australian CPI coming up.

By | January 31, 2018

 

Rising bond yields have again been in focus on Tuesday leading to a selloff in the US stock market, with the DJI’s 400-point fall being its steepest in almost 12 months. The US$ has been unable to make any gains however  and is trading mixed against the other currency pairs, after a volatile day, although it is a fair bit lower against Sterling in particular. Cable traders are pricing in around 50% chance of a UK rate hike by BoE in May, with the chance for a hike by August now rising to 80% and this has been helped today by some supportive comments on inflation from BOE Governor Mark Carney. In the commodities space, the metals are pretty much unchanged, while WTI is down by around 1.5% as traders sought to unwind some bullish bets amid growing fears that US oil supplies could rise for the first time in eleven-weeks.

Wednesday is likely to be a very active session , beginning with the Australian Private Sector Credit (exp 0.4%mm) and CPI (exp 0.7%mm, 2.0%yy; Trimmed Mean, exp 0.5%mm, 1.9%yy), to be followed by the NBS China Mfg & Non-Mfg PMIs.  Europe will look to the German Retail Sales, both the EU and German Unemployment data, and the EU Preliminary CPI (exp 1.3%mm, 1.0%yy) along with a speech from the ECB’s Coeure for guidance,. From the US we get underway with Donald Trump’s State of the Union Speech. This will be followed up by the ADP Jobs data (exp +180k), the December Pending Home Sales (exp 0.3%mm), the Chicago Purchasing Managers Index (exp 64.5) and finally we have Janet Yellen’s final FOMC Meeting at which quite a hawkish outlook is expected. Happy trading.

CURRENCIES
EURUSD: 1.2399
Res  1.2430  1.2455  1.2495
Sup  1.2360  1.2335  1.2305
USDJPY: 108.84
Res  109.20  109.50  109.75
Sup  108.50  108.30  108.00
GBPUSD: 1.4144
Res  1.4165  1.4200  1.4240
Sup  1.4100  1.4060  1.4000
USDCHF: 0.9346
Res  0.9375  0.9395  0.9430
Sup  0.9335  0.9310  0.9285
AUDUSD: 0.8081
Res  0.8095  0.8110  0.8135
Sup  0.8070  0.8055  0.8040
NZDUSD: 0.7328
Res  0.7355  0.7375  0.7400
Sup  0.7315  0.7295  0.7280
INDICES / COMMODITIES
S&P: 2830
Res  2835  2845  2855
Sup  2820  2810  2800
DJI: 26109
Res  26200  26305  26380
Sup  26005  25940  25850
ASX SPI: 5945
Res  5965  5980  6000
Sup  5930  5910  5890
XAUUSD: 1337
Res  1340  1345  1350
Sup  1335  1330  1325
XAGUSD: 17.11
Res  17.20  17.30  17.40
Sup  17.05  16.90  16.75
WTI: 64.31
Res  64.65  65.15  65.65
Sup  64.05  63.60  63.00