On Monday, the day ended the day by around 65 base points. From the stock market market point of view, it was relatively without incident.
Looking at the S&P 500, I still think it is well placed to restore its recent earnings. The rally seems to have been more trained by the disintegration of the option and the drop in implicit volatility than by any fundamental catalyst. The index is currently close to the retrace level of 61.8%, with the 200-day mobile average just above 5,745, and the summits of July 2024 nearby at 5,671. This area has significant technical resistance.
However, the FX market has told another story. The reinforced of around 80 base points and the 50 base points won. The most notable was, which appreciated 5.1% yesterday, following a decision of more than 4% on Friday. The Taiwan dollar has strengthened by more than 9% in just two days.
There is also the gap in the opening on Friday. The gaps that follow the net movements in the closure generally fill relatively quickly, so it would not be surprising to see this gap filled by Tuesday or Wednesday. In addition, the gap at 5,289 remains open and could still be targeted.
Meanwhile, the rate increased to 4.35% yesterday, which will be an important level to monitor this week. There is a 10 -year auction scheduled for May 6 and an auction of 30 years on May 8. The 10 years are constantly struggling to cross the range of 4.35% to 4.40%. An escape above this region could easily push the yield around 4.5%.
We will see how things are going on today, because it can change quickly, especially if a title has come out of its context.
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