Daily Alert – Wednesday 12th April 2023: Fed Minutes and CPI in the spotlight

Mark NugentApril 2023, Daily Alert

Daily Alert – Wednesday 12th April 2023: Fed Minutes and CPI in the spotlight

Good morning.

Yesterday saw indecisive risk sentiment, as per Monday. This is not unusual in the run up to today’s Fed Minutes and, critically, CPI.

We have the IMF saying that low interest rates will return once inflation has been conquered. (What they mean by “conquered” is the calculation of inflation will give a lower number primarily due to the original increases in fuel and other items falling out of the calculation window).

There is some disagreement among those who set the rate in the US. New York Fed President Williams said more hikes are needed whereas Chicago Fed President Goolsbee called for “prudence and patience” and is the first to suggest Fed voters may need to pause hiking for now.

Finally, we have Chris Harvey, Head of Equities Strategy at Wells Fargo expecting the S&P 500 to suffer a 10% correction (to 3700) in the next three to six months, and then returning to 4200 by year-end (we are around 4100 today). That’s around 10x daily ATR in BOTH directions. That a lot of trading opportunity.

I placed no trades yesterday. My particular interest is EURUSD, as I discuss in the video.

I’ll be back tomorrow.

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