Market Update – June 22/2022

Written by Stuart Cowell

USD holds at highs (USDIndex 104.51), Stocks closed up over 2% (NASDAQ +2.51%) – (1) dead cat bounce & another bear market rally or (2) signs of peak inflation and peak Fed bearishness ? (Technicals & Fundamentals still say 1). Asian shares closed lower on rapid spread of new Omicron  (Hang Seng -1.49%) Yields rheld their gains. Oil also slumped (Brent -3.42%Gold & BTC slide sideways. Biden expected to announce temp. tax reprieve on gasoline, BOJ Mins confirmed they will ease further if necessary “without hesitation” USDJPY hits new 24-year high. NZD hit by weak trade data.

  • USDIndex tested 103.72 on Tuesday before rallying to 104.55 now. 
  • Equities – USA500 closed +2.45% (3764), US500FUTS slumped to 3719 now.
  • Yields 10-year yield higher, closed at 3.26% , trades at 3.29% now.   
  • Oil & Gold had mixed sessions – USOil slumped 3% to trade at $104.90. Biden & Omicron news weighed &  Gold could not hold $1830 and trades at $1825 now on higher Yields and stronger USD.
  • Bitcoin continues to pivot around $20K, test $22K yesterday, back to $20K now.
  • FX markets – EURUSD hback under 1.0500,  USDJPY hit new 24-yr highs at 136.71 and Cable trades down to 1.2225 now, following Inflation news, from 1.2325 highs yesterday. 

Overnight – UK CPI hits 9.1% inline but up from 9.0% last month, CORE a tick lighter at 5.9% vs 6.0% & 6.2%, PPI beat 2.1% vs 1.8% & 2.7% prior and RPI also hotter at 11.7% vs 11.4% & 11.1% last time. NZ Trade Balance less than 50% of forecast at . Reuters Poll Fed Path: 75bp July, 50bp Sept & Oct, and 25bp Nov. (at the earliest). Japanese official – FX moves against the Yen “not ideal” 

Today – Canadian CPI, EZ Consumer Confidence, Speeches from Fed’s Powell, Barkin, Evans & Harker, SNB’s Jordan ECB’s de Guindos & Elderson, BoC’s Rogers.

Biggest FX Mover @ (06:30 GMT) NZDUSD (-1.18%). Collapsed from test of 0.6360 on Monday & Tuesday to 0.6250, as NZD Trade Balance missed significantly.   MAs aligning lower, MACD histogram negative turning lower, RSI 21.25, OS but still falling, H1 ATR 0.00124, Daily ATR 0.00850.

About the author

Stuart Cowell

With over 25 years experience working for a host of globally recognized organisations in the City of London, Stuart Cowell is a passionate advocate of keeping things simple, doing what is probable and understanding how the news, charts and sentiment work together to provide trading opportunities across all asset classes and all time frames.