Daily Market Outlook, December 1, 2022 ‘Powell Points To Moderating The Pace Of Rate Rises, Santa Rally To Start?’Asian equity markets took their lead from the late surge on Wall Street, Fed Chair Powell delivered a speech on the economy, inflation and employment, during which he suggested it made sense to consider slowing the pace of rate hikes in the US, and highlighting that he didn’t want to fall foul of over tightening, risk appetite abounded on the back of these comment, the SP500 over 150 points, the Dollar and US treasury yields sagged. Overnight, reports suggested that China may be softening its stance on Covid restrictions, data out of China also showed glimmers of hope with an improvement in Caxian manufacturing, up from 49.2 to 49.4. This morning’s UK Nationwide house price index fell for the second month in a row as buyers remain sidelined due to the negative impact of rate rises. In Germany retail sales data showed a sharper than expected fall ahead of the all important holiday shopping season.On the data front for the day ahead, the focus in the UK and Eurozone will be on PMI manufacturing data, flash reading have indicated that both regions are likely to remain in contractionary territory, completing and fifth month of depressed readings, this data will likely also confirm fears of negative Q4 GDP prints for both economies, however, on the positive side of the ledger their are nascent signs of the potential for peak inflationary pressures. In the US markets are poised for PCE deflator data which is expected to confirm the signal from October CPI, that inflation has started to slow. US ISM manufacturing data is expected to show activity continuing to slow, but markets expect it to hold the critical 50 level, representing contraction below, expansion above. The next major focus for markets will be tomorrow’s all important non Farm Payrolls data, any signs of deterioration in the employment landscape will likely be taken positively by markets based on the ‘bad news, good news’ dichotomy, with markets seeing weak data as supporting the potential for a Fed pivot on rate rises.Overnight HeadlinesFed’s Powell Signals Fed Prepared To Slow Rate-Rise Pace In DecemberFed’s Cook Says Smaller Rate Moves May Be Prudent Given LagsUS Economic Growth Slowed This Fall, Fed’s Beige Book SaysUS House Votes To Block Rail Strike, Mandate Paid Sick LeaveBeijing City To Let Some Low-Risk Covid Patients Home IsolateBeijing Sees Record 5,006 New Infections As Outbreak PersistsChina’s Factory Activity Shrinks In Nov Amid Widespread Covid CurbsJapan Firms Rising Capex Fuels Hopes For Smaller GDP Contraction In Q3Japan’s Factory Activity Shrinks For First Time Nearly 2 YearsBoJ Policymaker Vows To Keep Ultra-Low Rates Until Wages Perk UpDollar Sinks To 3-Month Low Vs Yen As Powell Says Fed To Go SlowOil Dips On OPEC+ Uncertainty; Easing China Covid Curbs Cap DeclinesUS Stocks Record First Back-To-Back Monthly Gains Since 2021Chinese Stocks Add To Historic Rally As Reopening Signs GrowTesla Is Planning A Massive Output Out Of Giga Texas In Q1 2023Musk Says Apple Isn’t Removing Twitter App, Easing StandoffTSMC Plans To Make More Advanced Chips In US At Urging Of AppleTechnical & Trade ViewsSP500 Bias: Bullish Above Bearish Below 4050TechnicalsPrimary support is 4050Primary upside objective is 4120Next pattern confirmation, acceptance above 4050Failure below 3930 opens a test of 390020 Day VWAP bullish, 5 Day VWAP bullishEURUSD Bias: Bullish Above Bearish below 1.0340TechnicalsPrimary support is 1.0340Primary upside objective is 1.0620Next pattern confirmation, acceptance above 1.0485Failure below 1.03 opens a test of 1.022020 Day VWAP bullish, 5 Day VWAP bullishToday’s New York Cut Option Expiries: EUR/USD: 1.0300-10 (1.58BLN), 1.0350 (393M), 1.0385 (256M), 1.0400 (275M), 1.0450 (212M), 1.0500-05 (556M) (477M), 1.0525 (246M), 1.0550 (261M), 1.0600 (1.2BLN)GBPUSD Bias: Bullish Above Bearish below 1.1950TechnicalsPrimary support is 1.1950Primary upside objective 1.22Next pattern confirmation, acceptance above 1.21Failure below 1.19 opens a test of 1.177020 Day VWAP bullish, 5 Day VWAP bullishToday’s New York Cut Option Expiries: 1.1890 (309M), 1.1990-00 (359M)USDJPY Bias: Bullish above Bearish Below 1401.36 Target Achieved, New Pattern EmergingTechnicalsPrimary resistance is 140Primary downside objective is 135Next pattern confirmation, acceptance below 136Acceptance above 140 opens a test of 14220 Day VWAP bearish, 5 Day VWAP bearishToday’s New York Cut Option Expiries: 137.00 (215M), 137.50 (250M), 137.90 (290M)AUDUSD Bias: Bullish Above Bearish below .6650TechnicalsPrimary support is .6650Primary upside objective is .6900Next pattern confirmation, acceptance above .6775Failure below .6660 opens a test of .660020 Day VWAP bullish, 5 Day VWAP bullishToday’s New York Cut Option Expiries: 0.6800 (300M)BTCUSD Bias: Intraday Bullish Above Bearish below 1650017100 Target Achieved, New Pattern EmergingTechnicalsIntraday 16500 is primary supportPrimary upside objective is 18000Next pattern confirmation, acceptance below 17200Failure 16400 opens a test of 1600020 Day VWAP bearish, 5 Day VWAP bullish
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