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Analysis

China’s CPI well below expectations

BY Janne Muta

|April 11, 2023

in terms of financial market news, everything’s a bit quiet After the Easter break. The financial calendar is void of high-volatility events and market operators are turning their focus on the US CPI report that’s due Tomorrow.

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Meanwhile, China's inflation data for March showed CPI y/y coming in well below expectations (0.7% vs. 1.0% expected) and below the February reading. Inflation pressures are not going to prevent Chinese authorities from adding stimulus to the economy. The AUD received additional support from the news that Australia and China had resolved a trade issue related to barley, potentially easing restrictions on Australian products worth A$20 bn.

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NAS

Nasdaq is bullish above 12 842. Below the level market could move down to 12 680. If the market creates higher lows above the 12 842 level, it’s likely to test the March high at 13 225.

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Gold

Gold is bullish above 1981.60. Below the level, the market could down to 1970. The next significant resistance level is the last week’s high 2032. As long as the market trends higher it makes sense to buy strength.

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Silver

Silver is bullish above 24.56. Below the level, the market could move down to 23.80 or so. The 24.56 support level is a weekly high from January. Therefore this is a significant support level and whether the market finds support from it or slips below is indicative of the market strength. If we see demand above the level the market is likely to stay bullish.

Silver is an industrial metal and as such an indicator of the global economy. Therefore, silver and equities are in a sense in the same category and somewhat correlated. In practical terms, this means you should keep an eye on the big trends both in silver and the equity indices in general.

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EURAUD

EURAUD is bullish above 1.6035. Below the level, the market could trade down to 1.5880. The market is trending higher inside a bullish price channel in the 8h chart. Should the channel low and the 1.6035 support break, the technical picture would turn bearish. The next significant resistance level above the current market price is at 1.6426.

The Next Main Risk Events

  • USD FOMC Member Harker Speaks
  • USD CPI m/m
  • USD CPI y/y
  • USD Core CPI m/m
  • GBP BOE Gov Bailey Speaks
  • CAD BOC Monetary Policy Report
  • CAD BOC Rate Statement
  • CAD Overnight Rate
  • CAD BOC Press Conference
  • USD 10-y Bond Auction
  • USD FOMC Meeting Minutes
  • GBP BOE Gov Bailey Speaks
  • AUD Employment Change
  • AUD Unemployment Rate
  • GBP GDP m/m
  • USD Core PPI m/m
  • USD PPI m/m
  • USD Unemployment Claims
  • CAD BOC Gov Macklem Speaks
  • USD 30-y Bond Auction
  • USD Core Retail Sales m/m
  • USD Retail Sales m/m
  • USD Prelim UoM Consumer Sentiment
  • USD Prelim UoM Inflation Expectations

For more information and details see the TIOmarkets economic calendar.

Trade Safe!

Janne Muta
Chief Market Analyst
TIOmarkets

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Janne Muta

Janne Muta holds an M.Sc in finance and has over 20 years experience in analysing and trading the financial markets.

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