The latest data from the ISM Services sector shows signs of improvement, but the overall market sentiment remains cautious. The US Dollar (USD) initially faced selling pressure but bounced back after positive ISM figures were released, easing concerns momentarily.
Investors are on edge as soft US jobs data has sparked fears of a recession, leading to global market volatility. The market is now pricing in a 125 bps easing by year-end, with a possible 50 bps cut in September.
Key Points:
- Services Employment Index climbs from 46.1 to 51.1
- New Orders Index rises from 47.3 to 52.4
- Services PMI moves from contraction to growth, up from 48.8 to 51.4
- Market fully pricing in 125 bps easing by year-end
DXY Technical Outlook:
The DXY index shows a bearish bias following recent economic data. While the index has dipped below key moving averages, indicators suggest a potential correction may be on the horizon. Support levels to watch include 102.50, 102.20, and 102.00, with resistance at 103.00, 103.50, and 104.00.
Analysis:
The latest market movements reflect a delicate balance between positive data and recession fears. Investors are closely watching the Fed’s next moves, with expectations of further rate cuts. While the outlook may seem uncertain, it’s essential to stay informed and adapt investment strategies accordingly.