Core PCE was reported 3.1% YoY (0,4% MoM) higher for January – a print inconsistent with a Fed rate cut. At the same time, the second estimate Q4 GDP cratered to 0.7% from the first estimate of 1.4%. All these data applied to the economy prior to the invasion of Iraq and 20% higher gas prices. From Briefing.com:

Futures maintained their overnight ramp, with multiple downward sloping channels implying TPTB’s blessing and suggestive of a SPX SMA200 tag.

Note that the yield curve is breaking down below the white TL from July 2023. While not as significant as a breakout, it almost always leads to a significant correction.

Our outlook remains unchanged.