CPI bang in line with expectations and falling impressively
This Daily Digest will cover:
- 📊 CPI bang in line with expectations and falling impressively
- 🪙 Crypto market continues to trade well
- 🇺🇸 USD under pressure
Yesterday saw CPI come in exactly as forecast falling to 6.5% from 7.1.
Ultimately the day played out exactly as I laid out yesterday with nasty volatility leading to a mild risk rally and a falling USD. Crypto has continued to gain ground with BTC leading the charge testing 19,000. We remain long of ETH looking for 1480 and am quietly looking at BTC hoping for a pullback to join the party.
The USD suffered across the board with Euro vaulting 1.0800 to trade as high as 1.0870 and USD/JPY plunging through 130 to trade down to 128.11 this morning. I have been banging the cross/JPY drum all year and it is finally starting to bear fruit. We have taken profit on the CAD/JPY trade mentioned 2 days ago but retain EUR/JPY. We also like to sell USD/JPY on a bounce back towards 129.50 rather than chase down here.
A light data calendar only has the University of Michigan survey at 3pm to focus on. After the weak ISM print earlier in the week the expectations look high to me so there could be further USD pain waiting here. That said, I expect a generally quiet day as there has been a lot to digest and the weekend beckons!
Good luck as always!
