All key US stock indices opened almost flat today. Apparently, the rapid rally of US stocks is losing momentum. Besides, soaring inflation is casting a shadow over the equity market. A 30-year peak of an annual CPI rate of 6.2% means that the US economy is not able to digest massive cash injections any more. Yesterday, Wall Street found the reason for optimism as US President Joe Biden talked online with China’s President Xi Jinping. During the video conference, the leaders of the largest global economies and major rivals discussed burning issues and tried to ease the degree of tension. Today investors found out that retail sales in the US increased more than expected in October. The indicator logged the biggest growth since March 2021. Consumers are poised to spend money before Christmas holiday. On the other hand, high consumer prices, especially gasoline prices, are a headwind for consumer spending. So, robust retail sales are a long-awaited positive sign for the US market. The S&P 500 is trading at 4,682, almost the same level as the closing price yesterday. However, the data on retail sales could give fresh impetus to the index’ uptrend. Analysts are certain that the S&P 500 is able to grow as high as 4,700 in the near time. While the stock market is trading at elevated levels, Elon Musk who also owns Tesla stocks is taking advantage of the situation. He has been selling Tesla shares in large portions for the second week in a row. On Monday, he sold about 934,000 shares worth nearly 930 million dollars. What does it mean? Perhaps the owner of the most valuable company in the US car manufacturing sector reckons that a slide in Tesla shares is a more feasible scenario than a further rally from the current levels. Now traders realize that a 5-month inflation rise is no way a transitory situation in the US. So, investors are revising their portfolios and raising expectations of monetary tightening by the US Fed. Besides, producers have to increase factory prices. For example, Tyson Foods, the world’s leading meat producer, has already raised its price tags due to a 30% growth of wholesale beef prices in the final quarter. Amid soaring inflation, large investors are willing to buy dollars as a cushion against the steady uptrend of the US currency. This reinforces the greenback’s bullish momentum. Its index opened on Monday sharply higher, landing a punch on the euro. Today the US dollar index is trading at near 95.50. Analysts predict its rise to the upper border of the corridor between 95.30 and 95.70. Curiously, despite the US dollar’s strength, it gave in to its Canadian rival yesterday. How come? Being a commodity currency, the loonie found support from oil prices that rebounded 1% on Tuesday. So, the USD/CAD pair is trading lower at near 1.2520. The currency pair is likely to trade in the corridor between 1.2480 and 1.2560. Meanwhile, crypto traders have been taking profit for two days straight. Yesterday, bitcoin was trading at about 66,000 dollars. Amid fundamental factors and the US dollar’s advance, a lot of investors decided to fix profit and sell their digital tokens. This pushed Bitcoin price down to 60,000 dollars. This resistance level is the key level to watch. If the crypto fails to break it, the price will resume its climb towards 62 – 62,000 dollars. On the contrary, if the key level is broken, the price will head downwards to 55,000 dollars. We will see what will happen soon. To sum up, the US stock market is taking a pause. However, fresh retail sales data is expected to encourage bullish momentum. Indeed, retail sales were upbeat in October. Besides, Joe Biden signed the infrastructure bill into law that would ensure the US global leadership in the 21st century. The law stipulates huge public investments in the US infrastructure in the amount of 1.2 trillion dollars. The President stated that the investment package would create millions of jobs, would be allocated for building new highways and bridges, and would promote green energy. On top of that, Congressional Democrats are already fighting for the next government aid bill. Perhaps this will trigger a new bullish wave in the stock market. Subscribe to our channel and stay tuned!

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00:00 Intro
00:49 US INFLATION RATE IN OCTOBER
01:22 S&P500
02:27 DXY
03:31 USD | CAD
03:59 BTC | USD