US GDP Up Next
Looking ahead to today’s US session, the key events will be the release of advanced US GDP for Q4. The data is drawing a great deal of attention ahead of the first FOMC meeting of the year next week and should we see any surprise in the release, volatility can be expected across financial markets today.
In terms of numbers, the market is looking for GDP growth of 2.6%. While down from the prior month’s 3. 2% reading, a print in this region should be relatively encouraging for risk sentiment. Such a reading would be broadly in line with the view that the US is at risk of a mild recession later this year. If data is in line with forecasts, movement is likely to be limited with traders instead preferring to wait for the Fed next week.
Trading Scenarios
However, if we see any upside surprise, this will likely be taken as a very encouraging sign by stock traders, helping lift risk sentiment across the board. The Fed is widely expected to opt for a slower pace of tightening next week and so a higher USD looks unlikely to be the outcome. However, should data surprise to the downside, we can expect USD to strengthen via safe-haven demand with stocks likely to be lower across the board.
Technical Views
NASDAQ
For now, the index is holding above the 11540.72 level, underpinned by the bull channel support. The market is testing above the bear trend line form last year’s highs and with momentum studies bullish, the focus is on a continuation higher while price holds above 11540.72. To the topside, 12220.22 is the next hurdle for bulls with a break there opening the way for a higher move towards 12875.84 next.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.