All eyes on US inflation
USD/JPY => The pair rises towards 147.00
BTC/USD =>The cryptocurrency holds over 19k
PepsiCo =>The pair rises towards 170
USD/JPY awaits US inflation data
USD/JPY is on the rise for the seventh straight session, having pushed to a new 24-year high of almost 147. The USD rallied after the release of wholesale inflation, PPI, which was higher than expected at 8.5%, down slightly from 8.7% but up from forecasts of 8.3%. Hot PPI often means that consumer prices will continue to climb and could keep pressure on the Federal Reserve to keep hiking interest rates aggressively. The minutes of the latest FOMC meeting also highlighted the US central bank’s hawkish stance. Today US inflation data will be under the spotlight. The headline inflation rate is expected to ease, but core inflation is expected to keep rising, which could embolden the Fed to hike rates at a faster pace. Meanwhile, Japanese authorities have said that they are watching the FX rate closely. It trades above the level where they intervened in September.
| US CPI September YoY | Expected: 8.5% (0.3%) | Previous: 8.7% |
Where next for USD/JPY?
USD/JPY has risen to a 24 high, approaching 147.00. The price trades above the 20 sma. However, there is some divergence on the RSI which suggests that momentum is slowing so buyers should be cautious. The RSI in overbought territory also warrants caution. Buyers will look for a rise over 147 to 147.90 the September 1998 high. Support can be seen at 145.90, September 22 high with a move below here opening the door to 145.00 and 144.50 the 20 sma.
BTC/USD holds steady with attention on tomorrow’s CPI
BTC/USD trades just over 19k, approximately flat over the past 24 hours as investors look ahead to US inflation data. Bitcoin has managed to hold steady even as equities have fallen steadily. The Nasdaq fell for a sixth straight session on Tuesday as investors fret over the prospect of higher interest rates. Today’s focus is on CPI data which is expected to show a rise in core inflation, keeping the Federal Reserve in rate-hiking mode. BTC/USD has traded quietly in the familiar range of 19k-20k whilst trading volume has also remained lackluster, regularly falling below the 20-day average.
PepsiCo rises 4% after earnings
PepsiCo rallied over 4% yesterday after upbeat Q3 earnings. The snack and soda market raised its full-year forecast after reporting revenue rose 9% to $21.97 billion, ahead of estimates of $20.84. EPS was $1.97 versus $1.84 forecast. PepsiCo, the consumer staple, has managed to successfully pass its price rises on to the consumer, helping it maintain margins and earnings. PepsiCo warned that it expects costs to continue rising in the second half of the year and will accelerate its cost management initiatives. Consumer staple stocks can perform well in times of recession.
Support can be found at 166 (20 sma) and 160 (October high).
Resistance for the stock can be seen at 171 (50 sma) and 174 (September high).
