US Wrap

Equity markets finished the session in the red for another session as inflation across the US is now coming into focus very clearly.

We’re seeing massive gas shortages in many states in the US, which have come on the back of pipeline outages. This is causing many areas to declare a state of emergency and adds to more chaos that we’ve been seeing lately.

Markets appear like they are finally starting to turn over a little and this situation will be one to watch in the coming days.

Interestingly, the USD is trying to find a bottom around the 90.0 level on the US Dollar Index while crypto markets have managed to recover somewhat from the big sell-off from the prior day. 

The Data Agenda

Given that gas prices are rising and there are widespread shortages, it is interesting that today we get both US inflation and crude inventory levels.

As I’ve been saying for some time, inflation is clearly out of control and the official data points wildly understate what real people are seeing in their everyday lives. This of course is by design as many Government payments and other important functions are linked to CPI.

We are expecting to see YoY CPI at 3.6%, but I would suggest the true figure is twice that. Just see how much it costs to buy lumber or gas at the moment. At some point, this must weigh on markets. Certainly, if it starts to disrupt the supply chain.

Forex Signal Update

The FX Leaders Team had a quiet session ahead of the CPI data, with five signals currently open.

XRP – Active Signal

XRP has bounced after what was a mini-flash crash yesterday and price is back above $1.50 for now.

EUR/USD – Active Signal

The EUR/USD has started to put in what looks like a nice double top. This is following the inverse of the USD, so our short signal is starting to look a little better now.

Cryptocurrency Update

Once again it is ETH that is leading the way higher this morning as price is getting ready to test its ALTs.

Ethereum fell below $4,000 yesterday but quickly rebounded and remains very bullish.

Interestingly, we also heard from the SEC today, suggesting that BTC was highly speculative. There is certainly a lot of Government officials warning about Bitcoin in recent times.