What Happened
Markets are on edge ahead of Tuesday’s US Consumer Price Index (CPI) release from the Bureau of Labor Statistics. Headline inflation is expected to print close to a three-year high, which has rattled both Wall Street and the ASX 200. The S&P 500 currently sits near 5,180, while the ASX 200 is hovering around 7,720 as traders reduce risk ahead of the data. Ongoing Middle East tensions โ with no resolution in sight in the Iran conflict โ are adding further uncertainty to global markets.
Key Levels
- S&P 500 Support: 5,100 (short-term) and 4,980 (major floor from April lows)
- S&P 500 Resistance: 5,260 (recent swing high) and 5,330 (February peak)
- ASX 200 Support: 7,650 (10-day low) and 7,550 (April consolidation zone)
- ASX 200 Resistance: 7,800 (psychological level) and 7,870 (year-to-date high)
Technical Picture
The S&P 500 is trading below its 50-day moving average (~5,220), which is a bearish short-term signal. The Nasdaq is also under pressure, trading near 16,200, below key resistance at 16,500. On the ASX, CBA is holding near $118.50 with support at $115.00, while BHP has slipped to around $43.80 โ a level that aligns with its 200-day moving average. RSI on the S&P 500 sits near 47, suggesting neither oversold nor overbought conditions โ the market is waiting for direction.
What Traders Are Watching
A CPI print above 3.5% year-on-year is likely to push the S&P 500 below 5,100 and drag the ASX 200 toward 7,650. Conversely, a softer-than-expected reading below 3.2% could see the S&P 500 reclaim 5,260 quickly. Gold (XAU/USD) is also in focus โ currently near $2,320 โ with a hot CPI likely to pressure gold lower toward $2,280, while a soft print could push it back above $2,360.
Bias
Neutral to Bearish. With inflation expected near a three-year high and geopolitical risk elevated, the path of least resistance is lower until the data confirms otherwise. Traders should wait for the CPI print before adding long exposure.
Source: US Bureau of Labor Statistics โ Consumer Price Index