US Equities

U.S. CPI Down Year-Over-Year

Posted Wednesday, June 12, 2019 by
Shain Vernier • 1 min read

Much to the chagrin of the United States Federal Reserve (FED), U.S. inflation continues to lag expectations. Today’s CPI figures are the latest in the ongoing “low inflation” saga. Although the metric held firm month-over-month, it underperformed expectations on a yearly basis. One has to wonder if May CPI was the last straw for the FED regarding rate cuts.

Without further adieu, here is a look at today’s U.S. CPI numbers:

Event                                                           Actual      Projected         Previous

CPI(MoM, May)                                            0.1%              0.1%               0.3%

CPI(YoY, May)                                              1.8%             1.9%                 2.0%

CPI ex Food & Energy (MoM, May)          0.1%             0.2%                0.1%

CPI ex Food & Energy (YoY, May)            2.0%              2.1%                2.1%

The key figures in this report are the year-over-year (YoY) stats for May. Both CPI and Core CPI came in beneath expectations and the previous releases. This does not bode well for the USD, as CPI definitively suggests persistently slow inflation.

NASDAQ Falls After U.S. CPI Release

It has been a challenging morning for June E-mini NASDAQ futures, with values rotating to the bear. Prices have stagnated beneath the 7500.00 level, a sign that a pullback of recent strength may be in the offing.

June E-mini NASDAQ Futures (NQ), Daily Chart
June E-mini NASDAQ Futures (NQ), Daily Chart

Here are the levels to watch as the session progresses:

  • Resistance(1): 62% Macro Wave, 7516.75
  • Support(1): Bollinger MP, 7391.00
  • Support(2): Daily SMA, 7377.50

Overview: A key observation from the June E-mini NASDAQ daily chart is the Doji formation that set up yesterday. This is an extremely bearish technical item and one that suggests a retracement to downside support may be underway. If the selling gains steam, we may be in a position to go long from the Bollinger MP or Daily SMA later in the week.

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