Stocks Week Ahead: Treasury Auctions Could Drive Further Bear Steepening

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Euro US Dollar Nieuws

US Dollar Japanese Yen,Nasdaq 100,S&P 500

Market Overview Analysis by Michael Kramer covering: Euro US Dollar, US Dollar Japanese Yen, Nasdaq 100, S&P 500. Read Michael Kramer's latest article on Investing.com

It will be a holiday-shortened trading week due to the Christmas holiday. Markets in the US will close early on Christmas Eve, December 24th, at 1 PM Eastern and remain closed all day on Wednesday, the 25th. Most markets in Europe will be closed on the 25th and 26th, while a few markets in Asia, including Japan and China, will remain open for the entire week. Due to the holiday, economic data this week will be sparse.Treasury auctions scheduled this week.

For the S&P 500, Friday’s move included a touch of the 10-day moving average, which acted as resistance. The index closed near the 50-day moving average, making it difficult to call. The lower Bollinger Band is no longer as oversold as earlier in the week, but conditions are still ripe for further downside. The 10-day moving average will be a key level to watch—remaining below it suggests continued declines, while a break above it could push the index toward 6,050.

We also saw easing in financial funding costs. The BTIC January contracts fell to 181 bps on Friday, down from 227 bps at their peak before the Fed meeting. While these costs are still elevated compared to December 12th levels of 160 bps, they have eased significantly over recent sessions.

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