US DATA: Back To The Early 80s For L-T Inflation Expectations...Sentiment Worse
To put April's UMich consumer sentiment and inflation expectations into long-term perspective: we're back to the early 80s for 5-10Y inflation expectations (6.7%), but overall consumer sentiment is even worse now than it was then (around record lows at 47.2 in April). Chart:
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EURIBOR OPTIONS: Large call fly
ERM5 97.6878/97.75/97.875c fly, bought for -0.5 in 15k.
EQUITY TECHS: E-MINI S&P: (H5) Has Entered Oversold Territory
- RES 4: 6178.75 High Dec 6 ‘24 and key resistance
- RES 3: 6166.50 High Jan 19
- RES 2: 5963.30 50-day EMA
- RES 1: 5757.75/5880.10 High Mar 10 / 20-day EMA
- PRICE: 4618.50 @ 13:47 GMT Mar 13
- SUP 1: 5534.00 Low Mar 11
- SUP 2: 5523.00 Low Sep 11 2024
- SUP 3: 5499.25 Low Sep 9 2024
- SUP 4: 5444.55 76.4% retracement of the Aug 5 - Dec 6 ‘24 bull leg
A bear threat in S&P E-Minis remains present and fresh cycle lows this week reinforce current conditions. MA studies are in a bear-mode set-up and this highlights a dominant downtrend and bearish market sentiment. Sights are set on the next important support at 5499.25, the Sep 9 2024 low. Note that the short-term trend condition is oversold, a corrective bounce would allow this set-up to unwind. Firm resistance to watch is 5963.30, the 50-day EMA.
CANADA: Early FI Gains Reversed On BoC Statement
- CORZ5 is holding 5 of an initial 7-tick sell-off on the back of the BoC statement, reversing the steady rally seen in the forty five minutes ahead of the BoC announcement.
- 2Y GoC yields have climbed 3.5bps since the release vs-1bp for Tsys, which limits the day’s slide in the Can-US 2y yield differential to -3.5bp on the day at -145bps.
- There wasn’t much guidance expected after being dropped in the January statement, although a more two-sided line likely supports the reaction: “Governing Council will proceed carefully with any further changes to our policy rate given the need to assess both the upward pressures on inflation from higher costs and the downward pressures from weaker demand”.
