Our Urgent Market Update Video reviews important real-time market developments and their impact on high-probability trading opportunities. Today, we comment on the recent positive market news and discuss how it led to major market moves, but we do need to ask what is next.
This is an important question to ask ourselves at this time, with many suggesting Tuesday’s major market moves are a bit overcooked. At this point in time, we don’t necessarily agree. We are, however, currently seeing a certified pullback. At some point, we are likely to get further upside moves over the short term unless something significant changes.
So why are we of this opinion? When we start with the data, we have seen better than expected US inflation numbers both on the consumer side and also on the producer side. This is always likely to see an upside move in Indices largely due to the potential for the Fed to start reducing rates sooner rather than later. Additionally, we have other economic data points which are not quite as bad as forecasters suggest. As a result, our bias is for further upside in the Indices along with a bearish USD. We can confidently maintain this directional bias until something significant changes.
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