The Waiting Continues, Not Only for Us Election Results but Inflation Data Too

Looking at the calendar we see that today, Thursday November 10th, is a key day this week. Today we find out the inflation numbers in the US. Core CPI is expected to drop to 0.5% from 0.6%. On a yearly basis, CPI is expected to also slow down to 7.9% from the previous 8.2%. Only the standard CPI reading m/m is about to rise from 0.4% reported previously at 0.6%. This data will definitely be crucial for the USD and stocks, probably even more than the final election results, which, by the way, are still not clear.

Major indices are reversing a bit on Thursday, continuing the move initiated yesterday. The drop is really small, and technically irrelevant to the long-term, buyers are still holding strong, setting a good environment for the Santa rally later this year.

Commodities start Thursday on the back foot, including gold, which had a marvelous session on Tuesday. In the case of Gold, this can be considered a normal and expected correction, which in theory should aim for the 1680 USD/oz in order to test it as a crucial support.

In the case of oil, the drop seemed to be something bigger. First of all, yesterday we had the Crude Oil Inventories data, which showed a stunning build of 3.9M barrels. This was a small shocker considering the forecast, which was on 0.3M. This data, a high and bigger than expected number, is negative for oil and this is how black gold reacted. Currently the price is flirting with lows from  last week and the overall, mid-term situation is bearish.

The Forex market saw some mid-term reversals. EURUSD gained a bit, and Wednesday was the first bearish day after three solid positive sessions and a great performance from the Euro. USDJPY also climbed higher, and it was not happening in a random place.

Buyers managed to defend the 145 support which can now be considered an absolute bullish stronghold. USDCAD reversed to the upside, which was a big surprise because before that, the price had created a very handsome bearish setup – a giant Head and Shoulders pattern. Well, technical formations are never 100% efficient.

We wrap this piece up with a small reminder that earnings season is still here. Today,we’re going to find out the numbers from AstraZeneca and Merck.