Durable Goods Up Next
Looking ahead today, the market will receive the latest insight into the health of the US economy with monthly durable goods data due. Recent data strength out of the US has added to the view that the Fed might press ahead with a larger .5% hike in March or signal a longer duration of tightening this year. With this in mind, incoming US data ahead of the March FOMC will be closely watched with further data strength supporting this hawkish narrative, which should keep USD well bid and risk assets pressured as yields rise.
Today’s Forecasts
On the numbers front today, the market is looking for the core number to rise to 0.1% from -0.2% prior. However, the headline reading is expected to drop to -3.7% from 5.6%. If seen, this will likely cause some near-term weaning in USD though shouldn’t upset the picture for March too much. Additionally, given these low expectations, if data surprises to the upside this should feed into a fresh round of USD buying.
Technical Views
USDJPY
The rally in USDJPY off the YTD lows has seen the market breaking out above the bear channel from last year’s highs and above the 132.91 level. This is a key pivot for the market and while above here, the focus is on a continuation higher towards the 139.33 level next, in line with bullish momentum studies and a large retail short position.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.