Today at 16:30 Moscow time data for the US is released. Like us, the forecasts are not the most optimistic. No wonder investors started actively hedging against the decline of the S&P 500, as indicated by the rapid growth of option premiums.
And, nevertheless, following the results of yesterday’s trading session:
▪️ increased by 1.15%;
▪️ at 1.11%;
▪️ Composite на 1,48%;
▪️ at 1.10%.
What is the reason for yesterday’s optimism?
Probably the investors rejoiced lower wage growth expectations. Household income growth forecasts fell 1.3 percentage points to 3.3% in the January survey, the biggest monthly decline in nearly a decade, according to the New York Fed. At the same time, consumer inflation expectations for one year ahead remained at the level of 5%.
Today’s data should clarify the situation with the rate of price growth and the trend towards disinflation. In the meantime, Fed Board member Michelle Bowman insists on the continuation of the cycle of rate hikes, and JP Morgan believe that the markets underestimate the resolve of the regulator.
What are we waiting for?
It’s a 50/50 situation for me.
Inflation data comes out a little worse than expected – the markets may not like it.
• We will see an increase in profitability.
• See growth again.
• Well, the fall of the stock market by a percentage or two.
If the data is strong, we can admire the short squeeze.
But in any case, I expect that the market, even if it sags on not the best statistics, is likely to quickly win back losses. In any case, I believe that the potential for movement at 4250-4300 exists. Perhaps even a little higher.
So let’s look at the statistics at 16:30. I took a little short. If the data is not the best, the tool can add 5-10 percent. I’m realizing my profits and, perhaps, I’ll turn over to the top.
If everything is ok … So it will explode and. Then I will close SPXU at a loss. Insurance, however.
