Daily Market Outlook, February 17, 2023

Fed Hawks Weigh On Risk Appetite As Investor Risk Sentiment Sours

Asian equities declined as US producer price inflation and hawkish Fed rhetoric weighed on investor appetite into the weekend. Treasury yields ascended with the 10yr yield approaching 4% as markets reprice US  rate expectations towards three further 25bps increases by the summer and for rates to remain higher for longer. Goldman Sachs has raised its US rate view, the firm now looks for three further 25bps hikes from the FOMC in March, May and June, lifting its view of the terminal rate to 5.25-5.50%; the firm raised its forecasts in light of stronger growth and firmer inflation metrics. In the Eurozone ECB’s Schnabel added to the hawkish tone from global central bankers as she deemed monetary policy transmission in Europe may require more aggressive ECB policy. The data docket for the European session is scant, Statetside the only print of note is import price inflation, investor attention will shift to Fed’s Barkin set to make remarks regarding the US labour market and Fed Governor Bowman is also scheduled to speak. 

FX Options Expiration New York Cut

  • EURUSD 1.08(455m)

  • USDJPY 134.40(395m)

  • GBPUSD 1.2415(403m)

  • AUDUSD .6740(365m)

Overnight News of Note

  • Dollar Rises To 6-Week Peak As Strong US Retail Sales Bolster Higher-Rates Scenario

  • Fed’s Mester Says She Saw ‘Compelling’ Case For Half-Point Rate Hike

  • Fed's Bullard Backs More Interest Rate Increases

  • ECB's Lane Says Tightening Effect Still In Pipeline

  • EU Commission Scratches Russia Nuclear Sanctions Plans

  • UK PM Sunak Due In Northern Ireland As Protocol Deal Imminent

  • Dow Falls More Than 250 Points After Another Hot Inflation Report

  • Goldman Sachs Steps Back From Bidding For New Credit Card Programs

  • Bank Of America Plans Job Cuts In Its Investment Bank

  • Tesla Recalls 362,758 Vehicles; Full Self-Driving Beta Software May Cause Crashes

(Sourced from Bloomberg, Reuters and other reliable financial news outlets)

Technical & Trade Views

SP500 Bias: Intraday Bullish Above Bearish Below 4177

  • Primary support is 4005

  • Primary objective is 4384

  • Below 4000 opens 3965

  • 20 Day VWAP bullish, 5 Day VWAP bullish

EURUSD Bias: Intraday Bullish Above Bearish below 1.0710

  • Primary resistance is 1.0950

  • Primary objective is 1.0620

  • Above 1.0820 opens 1.09

  • 20 Day VWAP bearish, 5 Day VWAP bearish

GBPUSD Bias: Intraday Bullish Above Bearish below 1.20

  • Primary resistance  is 1.2265

  • Primary objective 1.1840

  • Above 1.2265 opens 1.2337

  • 20 Day VWAP bearish, 5 Day VWAP bearish

USDJPY Bias: Intraday Bullish above Bearish Below 134

  • Primary support  is 131

  • Primary objective is 134.70

  • Below 130.80 opens 130.11

  • 20 Day VWAP bullish, 5 Day VWAP bullish

AUDUSD Bias: Intraday Bullish Above Bearish below .7050

  • Primary resistance is .7050

  • Primary objective is .6750

  • Above .7150 opens .7250

  • 20 Day VWAP bearish, 5 DayVWAP bearish

BTCUSD Intraday Bias: Bullish Above Bearish below 25000 - 25000 Target Hit, New Pattern

  • Primary support 23500

  • Primary objective is 26700

  • Below 20300 opens 19500

  • 20 Day VWAP bullish, 5 Day VWAP bullish