NASDAQ Selling Off
The recent NASDAQ short idea posted ahead of last week’s US CPI has now hit its first target. With USD rallying firmly on the back of a bumper May CPI report (annual inflation highest since 1981 at 8.6%), US stocks have cratered. Tech stocks have been among the hardest hit, as reflected by the price action in the Nasdaq. With equities under pressure amidst the current USD rally and with risks of further upside in USD around the FOMC this week, bears can look to stay short through 10999.03 while price remains under the 11540.72 level.
Keep an Eye On
The main focus this week is the FOMC tomorrow. While a .5% hike is widely expected, there has been chatter regarding the potential for a larger .75% hike. If seen, this would no doubt drive USD firmly higher, sending equities prices lower still. The risk now, however, is that should the Fed simply stick to the well-signalled .5% hike, USD might correct a little. The focus will therefore be on forward guidance. If the Fed signals plans to keep hiking beyond July, quashing suggestions of a post-July pause, this will send USD higher and equities lower. If there is any indication of a potential post-July pause, equities will likely rally on a weaker USD.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.