Daily Market Outlook, January 8, 2024

Daily Market Outlook, January 8, 2024Munnelly’s Market Minute… In Asia, stocks experienced a gradual decline following a quiet start, influenced by post-data market volatility in the US and the absence of Japanese participants due to Respect for the Aged Day. The markets are eagerly anticipating key inflation data releases later this week. The Hang Seng and Shanghai Composite were under pressure due to concerns about shadow banking and geopolitical frictions. Hong Kong's losses were exacerbated by selling in the tech sector, while China Evergrande New Energy Vehicle shares slumped after its vice chairman's arrest.Last week, financial markets adjusted their expectations for interest rate cuts by major central banks this year, scaling back somewhat due to signs of more robust economic activity in key developed economies. The UK services Purchasing Managers' Index (PMI) showed stronger-than-expected activity, while Eurozone Consumer Price Index (CPI) inflation increased in December. However, core inflation declined, reinforcing the European Central Bank's cautious stance on rate cuts. The December US labour market report exceeded expectations, with employment outpacing forecasts and wage growth unexpectedly accelerating.While markets have postponed earlier expectations for Q1 rate cuts, they still anticipate significant cuts throughout the year. In the US, the first cut is now projected for May, with over 125 basis points of cuts anticipated by 2024. Similar expectations exist for the Eurozone. For the UK, the first cut is fully priced for June, with just under 125 basis points of cuts anticipated for the year.Today's economic calendar lacks tier one data on the docket, no major releases are scheduled for the UK , but early tomorrow morning, the British Retail Consortium (BRC) will release its update on December retail activity. Footfall data from retail outlets suggest that damp weather kept shoppers away in December. In the Eurozone markets will see the release of several confidence measures. Stateside, the New York Federal Reserve will publish its monthly report on consumer expectations before the release of this week's Consumer Price Index (CPI) data on Thursday, the U.S. December CPI is expected to increase by 0.2% monthly, as per a Reuters poll, up from 0.1% in November. Additionally, the core CPI is anticipated to remain unchanged at 0.3%, the same as in November. Fed policymaker Bostic is scheduled to share his views on the outlook for the US economy. His comments will offer insight into his thoughts on the possibility of interest rate cuts this year. Overnight Newswire Updates of NoteFed Revives Investors’ Hopes Of End To ‘Quantitative Tightening’Congress Leaders Reach Deal On Spending Levels In Step To Averting ShutdownChina Sanctions 5 US Defense Industry Companies On Taiwan Arm SalesUK Labour Market Firms After Recent Slowdown – REC SurveyUS Dollar Holds Ground Monday As US Inflation Data LoomsBitcoin ETF Hopefuls Eye This Week For Long-Awaited SEC GreenlightBond Traders Seize On 4% Yields Confident Fed Rate Cuts ComingOil Drops As Saudi Pricing Cuts Counter Middle East Supply RisksSaudi Arabia Cuts Oil Prices To Asia As Market Weakness PersistsAsia Stocks Dragged Down By China Share Selloff MondaySamsung Set For Smallest Profit Drop In 6 Quarters On Chip ReboundGoldman Says S&P500 Earnings Forecast Could Rise FurtherLargest US Banks Set To Log Sharp Rise In Bad Loans This WeekBoeing Faces Scrutiny Over 737 Max Planes After Alaska Airlines BlowoutJefferies Analysts: iPhone Sales In China To Fall Double Digits(Sourced from Bloomberg, Reuters and other reliable financial news outlets)FX Options Expiries For 10am New York Cut(1BLN+ represent larger expiries, more magnetic when trading within daily ATR)EUR/USD: 1.0875 (400M), 1.0950 (645M), 1.06975 (406M)1.1045-50 (309M)USD/JPY: 143.50 (225M), 144.00 (280M), 144.50 (510M)EUR/JPY: 156.00 (450M)GBP/USD: 1.2665-75 (350M),EUR/GBP: 0.8500-05 (410M), 0.8650 (300M), 0.8720-25 (272M)AUD/USD: 0.6500 (658M), 0.6620 (400M), 0.6640-50 (822M)0.6700 (205M), 0.6725 (633M), 0.6800 (279M), 0.6840 (708M)USD/CAD: 1.3350 (301M)CFTC Data As Of 05/01/24USD bearish increasing-1,674CAD bearish decreasing +1,045EUR bullish neutral +138GBP bullish neutral  +78AUD bearish decreasing +601NZD neutral neutral +198CHF bearish increasing -262JPY bearish neutral -157Technical & Trade ViewsSP500 Bullish Above Bearish Below 4730Daily VWAP bearishWeekly VWAP bearishAbove 4730 opens 4755Primary support 4600Primary objective is 4611EURUSD Bullish Above Bearish Below 1.1000Daily VWAP bullishWeekly VWAP bullishAbove 1.1030 opens 1.1130Primary resistance 1.1130Primary objective is 1.0850GBPUSD Bullish Above Bearish Below 1.27Daily VWAP bullishWeekly VWAP bearishAbove 1.2710 opens 1.2820Primary resistance  is 1.2820Primary objective 1.2550USDJPY Bullish Above Bearish Below 144.40Daily VWAP bullishWeekly VWAP bullishAbove 144 opens 146.50Primary resistance 146.50Primary objective is 146.50AUDUSD Bullish Above Bearish Below .6750Daily VWAP bearishWeekly VWAP bearishBelow .6660 opens .6550Primary support .6525Primary objective is .6933BTCUSD Bullish Above Bearish below 44000Daily VWAP bearishWeekly VWAP bullishAbove 45000 opens 47000Primary support  is 40000Primary objective is 47000