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• US equity and treasury markets surged, as the FOMC delivered an expected 25bps rate move, the smallest increase since last March, while The Fed Chair maintained the stance that further hikes were likely, markets sensed that there is an impending plateau in Fed policy as the Fed Chair acknowledged that the disinflationary process had commenced, the read from investors was that Fed hawkishness is starting to shift. Asian equities initially cheered the handover from Wall Street; the enthusiasm has waned somewhat as the session has progressed with Nikkei, Shanghai COmp and Hang Seng flatlining as European markets open.  

• European investors will be firmly focused on the two major central bank decisions today from the Bank of England and the European Central Bank. In the UK markets are less decisive on the potential rate move from the BoE, while market pricing assigns a higher probability to a 50bps point move today, some MPC members have been vocal regarding their hesitancy around further meaningful rate rises, on the whole the committee appears to deem inflationary pressures as remaining too elevated to pause the current rate cycle. The key takeaway from today's meeting will be whether the Committee and specifically Governor Bailey remain anchored to the 4.5% terminal rate. The ECB are set to move by another 50bps, with markets fully pricing this move given the clear signals from ECB officials. While ECB Chief Lagarde has acknowledged nascent signs of economic improvement in the Eurozone, with the economy narrowly avoiding contraction in Q4 ‘22, Lagarde remains firmly focused on inflationary pressures which are believed to be trending higher at the core level. With today’s 50bps move considered a lock, markets will move to assess the potential for another 50bps move in March, Madame Lagarde’s press conference and response to questions will be parsed for signs that her hawkish stance remains robust. 
• In the US, investors will eye weekly jobless claims and durable goods data, jobless claims are expected to nudge higher from last week, confirming continued tightness in the employment market stateside.
• Markets-wise, investors are poised to digest a major round of earnings releases, last night Meta reported earnings, with Meta shares soaring in the post market up as much as 20%, while revenues and EPS were broadly inline, the rally was sparked by the announcement of a $40bln share buyback, investors will now look to Apple, Google parent Alphabet and Amazon who all announce after the close of New York trading tonight. 
   

Overnight News of Note

• Stocks And Futures Extend Fed Fuelled Rise Through Asia Session
• Fed Slows Its Tightening With Quarter-Point Interest Rate Rise
• Fed Traders See Pivot From Rate Hikes To Rate Cuts In Second Half
• McCarthy Sees Opportunity For Deal On Debt After Biden Meeting
• ECB Set To Hike Rates A Half-Point As Focus Turns To March Meeting
• BoE Set To Lift Rates To 14-Year High, Might Hint At Next Moves
• BoJ Deputy Wakatabe Indicates No Policy Change Next Month
• Hong Kong Central Bank Raises Interest Rate 25Bps After Fed Hike
• Brazil’s Central Bank Leaves Key Lending Rate Unchanged At 13.75%
• Bitcoin Jumps To Highest Since August In Post-Fed Crypto Rally
• Oil Prices Rise After US Fed Hikes Rates, Weakening The Dollar
• Gold Scales Late-April Highs After Dovish Fed
• Meta Shares Soar On Resilient Revenue And $40Bln In Buybacks

(Sourced from Bloomberg, Reuters and other reliable financial news outlets)
 

Options Expiration For the New York Cut 10am EST

(BOLD expiries with a value of a Billion+ more magnetic if price is within the daily trading range - source DTCC)

• EUR/USD: 1.0910 (458M). 
• USD/CHF: 0.9100 (250M)
• USD/JPY: 129.20 (200M). 
• USD/CAD: 1.3400 (240M)
• AUD/USD: 0.7140 (302M) 0.7185 (918M)
• EUR/AUD: 1.5600 (589M). 
• EUR/GBP: 0.8650 (401M), 0.8700 (298M)

CFTC Data As of 27/01 ( Source Reuters)

• USD net spec short in the Jan 18-24 period; $IDX -0.46%
• EUR$ +0.86% in period, specs buy 7,365 contract long now +134,349
• $JPY +1.56% in period yen short cut by 1,326 contracts now -21,635
• GBP$ +0.44$ in period, short reduced by 763 contracts to -23,934
• CAD specs -3,453 contracts now -30,712; AUD specs +449 contract now -33,171
• BTC +7.45%, spec short increased by 810 contracts now -1,437
• Next week's data likely mooted by Fed, ECB, BoE meets Feb 1-2 after period closes
   

Technical & Trade Views

SP500 Bias: Intraday Bullish Above Bearish Below 4090 - 4138 Target Hit, New Pattern Developing

• Primary support is 3990
• Primary objective is 4384
• Below 3980 opens 3910/00
• 20 Day VWAP bullish, 5 Day VWAP bullish

(Click on image to enlarge)

EURUSD Bias: Intraday Bullish Above Bearish below 1.0930 - 1.10 Target Hit, New Pattern Developing

• Primary support  is 1.0750
• Primary objective is 1.11
• Below 1.0730 opens 1.0610
• 20 Day VWAP bullish, 5 Day VWAP bullish

(Click on image to enlarge)

GBPUSD Bias: Intraday Bullish Above Bearish below 1.2330

• Primary support  is 1.2200
• Primary objective 1.2460
• Below 1.2150  opens 1.2100
• 20 Day VWAP bullish, 5 Day VWAP bullish

(Click on image to enlarge)

USDJPY Bias: Intraday Bullish above Bearish Below 131.50

• Primary resistance is 132.30
• Primary objective is 125.00
• Above 133.00 opens 135.00
• 20 Day VWAP bearish, 5 Day VWAP bullish

(Click on image to enlarge)

AUDUSD Bias: Intraday Bullish Above Bearish below .7050

• Primary support is .6940
• Primary objective is .7250
• Below .6930 opens .6870
• 20 Day VWAP bullish, 5 Day bullish VWAP 

(Click on image to enlarge)

BTCUSD Intraday Bias: Bullish Above Bearish below 23000

• Primary support 21500
• Primary objective is 25000
• Below 21000 opens 20300
• 20 Day VWAP bullish, 5 Day VWAP bullish

(Click on image to enlarge)

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