In the current economic outlook, the consensus of economists in the USA anticipate a slowdown in the growth rate of “Core inflation” PCE that could be the lowest in 2024. However, recent positive economic indicators have left the Federal Reserve (Fed) uncertain about future interest rate reductions still expected in November and December. In this sense, the upcoming publication of price growth figures and personal spending data will provide a clearer view of the financial health of the US economy and consumer behavior.
Globally, keep an eye on economic events such as the European Central Bank's (ECB) potential rate cut and China's Purchasing Managers' Index (PMI) data that will reflect lingering concerns about overcapacity and its impact on manufacturers local. These factors have contributed to a shift in the macroeconomic narrative, moving from an expectation of a slowdown to a "no landing" scenario.
Likewise, this week we also expect preliminary inflation figures in Europe, which should show a slight increase in consumer price growth compared to the previous year, reaching 2.5% in May. In this context, core inflation is expected to remain at 2.7%. All this while taking into account that the European Central Bank is preparing a cut next month.
This being the case, we will be waiting to know those price growth projections, the state of Americans' savings and the increase in credit card debt. Additionally, first quarter Gross Domestic Product (GDP) estimates and other economic updates in the United States will be evaluated.
Looking towards the US stock markets and despite having passed an apparently calm week, US equity funds experienced a fifth consecutive inflow of flows, reflecting an improvement in the sentiment of individual investors that, however, remains far from areas of euphoria. Globally, equity funds have seen significant net inflows so far this year, with a notable inflow into US funds, but with record outflows from Japanese stocks and European stock funds.
Market sentiment suggests growing acceptance of the Fed's bias toward keeping rates "higher for longer," without much concern about the impact of current policy on stocks and risk assets. The financial week was relatively stable despite hawkish signals from the Fed and strong earnings reports from companies like Nvidia. Next week is also unlikely to offer definitive direction, as the market appears unfazed by the Fed's policies, and some bearish investors have adjusted their outlook. However, there are signs that a contrarian "sell" signal could emerge based on global stock indices while, as they always say, don't forget that trust doesn't exist in the stock market.
Key technical levels
THEY ARE NOT INVESTMENT RECOMMENDATIONS. Only comments from a technical informative point of view.
1.- S&P
From a technical point of view, the importance of 5250 points as the first support zone is confirmed. If that area is lost, subsequent support level at 5150 points, 5060 and the key area of 4960. Above, 5325 marks the premium of the resistances to monitor. The sharp drop in volatility to levels below 12 points is striking, prompting us to prevent excess confidence in an environment where the existing overbought has been slightly corrected. Good times to have an exit strategy.
Source: investing.com
IBEX-35
From a technical point of view and having surpassed 11,200 points, the Ibex-35 has encountered the wall of 11,400 points that remains as short-term resistance. Although it is true that we expected an extension to 11,600 points, we will have to wait to see whether or not there is the capacity to attempt that new upward stretch. We go on to consolidate levels with support at 11200 first and 10900 as a second control zone.
Source: investing.com
3.- BITCOIN (BTC)
The recent approval of the first ETH ETFs in the United States by the SEC marks a significant advance for the crypto market. This development has surprised many, as it was not expected to be achieved so soon. This news reflects a change in regulatory perception towards digital assets, underscoring the evolution of the market and the growing acceptance of digital assets in the traditional financial sphere.
There are still several details to be known about these ETFs, such as the associated fees, specific ticker symbols and the exact timeline for their entry into the market, aspects that will be revealed in the coming days. However, the important thing is that ETH is not a Security and that facilitates its inclusion in investment funds and so on. Additionally, political hostility towards the crypto industry in the United States is decreasing, which could open up new opportunities for the sector.
This approval not only has local implications, but also global ones. Sending a strong message to other jurisdictions about the seriousness and permanence of the cryptoasset market is an important step. For example, the London Stock Exchange plans to list BTC and ETH ETNs, although they will initially only be available to professional investors.
On the legislative front, the US House of Representatives recently approved the FIT21 regulatory framework for digital assets, reflecting a significant break in Democratic opposition. Although it has not yet been ratified by the Senate, growing support suggests that eventual approval is possible, which would accelerate the adoption of regulatory frameworks for cryptocurrencies in the United States.
From a technical point of view, we remain within the large channel marked by 60,000-72,000USD, waiting for new catalysts that will move prices out of them. The ETH ETF helped attempt a new attack on $72,000 to end in failure and return to support levels of $66,200. Right now, we have to surpass 68200 USD and 71000. As supports we leave 66200USD before going for 63800. Below we have 60000USD and only if 57000USD is lost will we think about a major correction.
Source: investing.com
This content is for informational and educational purposes only and should not be considered investment advice or an investment recommendation. Past performance is not an indication of future results. CFDs are leveraged products and carry a high risk to your capital
