US Inflation Surprises to the Upside

US Inflation Surprises to the Upside

Our Urgent Market Update Video reviews important real-time market developments and their impact on high-probability trading opportunities. Today, we look at how US inflation surprises to the upside and we discuss what is next for these markets.

You may have seen that all of yesterday’s US inflation numbers came between 10 and 20 basis points above expectation with the headline CPI number coming in at 3.1% when the markets (including the US) expected this number to come in below 3%. This was not the case so markets discounted accordingly and we saw significant selling across all major US markets. The S&P 500 and NASDAQ sold off aggressively and the USD strengthened against all major currencies along with a weaker gold market. This initial move is in line with our expectations, however, the question is, will we see further downside?

We anticipate that we will see further short-term downside in the US Indices and a stronger dollar eventually even though prices are currently pulling back in line with the profound resilience we have been seeing in the US Indices since late October of last year. Let’s see how these markets play out from here. Hopefully, some decent high-probability trades are in the pipeline.

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