Global economic fears seem to be subsiding as U.S markets close in on all-time highs once again as policymakers are expected to keep stimulus in place for some time to come.
Despite a lacklustre U.S labour market report last Friday, U.S equity markets are pushing higher as bondholders are unwinding their positions with the U.S 10-year fell to its lowest level in a month.
U.S Inflation data will be released tomorrow at 14:30 SAST and will be the hot topic of discussion the rest of the week. The U.S CPI data is expected to show an increase of 4.7% annually and core inflation to increase to 3.4% which is much higher than the Fed’s 2% target rate. The muted Jobs data could see the Fed hold its current course despite the inflation data.
Here is what’s expected this week:
The Wall Street 30 Technical Analysis
The price action on the Wall Street 30 (WS30) Index moved lower to our level of interest (blue rectangle) before pushing higher as described in our previous WS30 note. We might see prices roll over to find support at the 34237-price level as the market digests the CPI data this week.
- The price action is consolidating and might see a short term move lower, before targeting higher levels.
- The 50-day SMA (blue line) is at the current price level and giving no indication.
- The Relative Strength Index (RSI) is also neutral, and we are waiting on direction.
Chart Source: Wall Street 4H Timeframe - GT247 MT5 Trading Platform
Trading term of the day
A market-neutral strategy is a type of investment strategy undertaken by an investor or an investment manager that seeks to profit from both increasing and decreasing prices in one or more markets while attempting to completely avoid some specific form of market risk. Market-neutral strategies are often attained by taking matching long and short positions in different stocks to increase the return from making good stock selections and decreasing the return from broad market movements. – Investopedia.
*Take note: The outlook and levels might change as this outlook is released during the current days (Wednesday the 9th of June 2021) U.S Market open.
Sources – MetaTrader5, Reuters, Investopedia.
Barry Dumas | Market Analyst at GT247.com
Barry has 12 years of experience in the financial markets. He enjoys educating clients on trading / investing and providing punchy technical analysis on securities. He currently holds a Wealth Management qualification and is studying towards becoming a Chartered Market Technician® (CMT) designation holder.
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