US Retail Sales in Focus
The key data focus for today is the US Retail Sales reading for April. On the back of a bumper April inflation release earlier in the week, today’s data is attracting plenty of attention as the last key release of the week. Last month, the core reading came in at 8.4% while the headline reading came in at 9.8%. This time around, the market is looking for 0.5% and 1% respectively. With the bar set so low, and on the back of a much higher than expected inflation reading, there are clear upside risks for USD heading into this event, which translate into downside risks for equities.
Where to Trade US Retail Sales?
On the back of the heavy sell off seen earlier in the week, US equities have recovered some of the decline heading into today’s release. With this in mind, there is room for equities to take a further plunge today if the release comes in well above expectations. With the MACD having turned lower, a break back below the 4116 level will open the way for a test of the 4028.50 lows. Below there, 3957.50 is the next support to watch. Alternatively, if the reading is in line with expectations or only slightly above, equities are likely to continue back up towards 4182.50.
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