Rising inflation and looming interest rate hikes overshadowed any good news about the global growth outlook as the recent momentum in equity markets loses steam.
Positive U.S retail sales and industrial production data helped to lift the global growth picture despite the Chinese economic slowdown. Data also showed Japan’s economy regressed less than what was expected but all eyes are on U.K inflation now.
Asian markets turned lower on Wednesday after a four-day winning streak as CPI news out of the U.K dampen any glimmer of hope of a global growth recovery anytime soon. British consumer price inflation rose to 9%, the highest it has been since the 1980s. The Bank of England (BoE) has forecasted CPI would cross the 10% threshold and is expected to raise interest rates to levels last seen during the financial crises era.
The Wall Street 30 Technical Analysis
The price action on the Wall Street 30 (WS30) remained somewhat flat over the last week after reaching a new low point at 31225 and regaining momentum back to the 32456-support level.
If the current 32456 support level does not hold, then we could expect the bears to take control and push prices back lower to the 31870 and 21225 support levels.
For the bull case we need to see an improvement in the fundamentals picture and a rebound in price from the technical 23456 support level. The 50-day simple moving average of price (blue line) will be watched closely as it is also acting as support to higher prices as well as the RSI indicator.
Current State / Chart Source: Wall Street 4H Timeframe - GT247 MT5 Trading Platform
Take note: The outlook and levels might change as this outlook is released during the current days (Wednesday the 18th of May 2022) U.S Market open.
Sources – MetaTrader5, Reuters, Tom Westbrook
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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