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Stronger In a Range


Weaker In A Range


Ending The Week On A Soft Note


Bearish Risk Growing


Stronger, But Still Vulnerable


SP500 PE Ratio vs. CPI Inflation

  • Recovery off Wednesday's FOMC initial react low of $1.2125 extended through Thursday's session to $1.2273 during the NY afternoon, closing the day at $1.2269.
  • Move up was seen driven by general pressure on the USD as risk assets edged higher, reacting in part to headlines suggesting a stop-gap spending bill in the US into today's spending deadline.
  • An orderly USD correction seen in Asia which acted to take EUR/USD off its early high of $1.2272 to a low of $1.2239(matching an hourly low in NY) where it met support, edging toward $1.2250 into Europe.
  • E2.2bln of $1.2250 strike option interest rolls off at today's NY cut, with E668mln rolling off at $1.2225-30 and E875mln at $1.2200.
  • Support $1.2239, $1.2225/20 and into $1.2200. Resistance $1.2272/73 and into $1.2280, a break to expose $1.2300.
  • Germany PPI 0700GMT, Ifo 0900GMT, EZ Current A/C 0900GMT.
  • As the weekend approaches, with Christmas holidays at the end of next week, position adjustments likely with markets next week expected to begin thinning, despite continued risk events(US COVID stimulus funding/spending; Brexit deadline Sunday).
  • MNI Techs: EURUSD extended gains Thursday, adding to this week's rally. Clearance of resistance at 1.2178, Dec 4 high brings to an end a recent period of consolidation and marks a resumption of the underlying uptrend. With bullish conditions intact, attention turns to the next objective of 1.2293, the Apr 23 2018 high. Price has remained above key support at 1.2059, Dec 10 low. A break is required to signal a reversal. 1.2178 marks initial support.
MNI London Bureau | +44 203-586-2231 |