// DAILY DIGEST

EUR/USD slid 85 pips to 1.1631 as a 1.4% monthly PPI shock (vs +0.4% expected) jolted Treasury yields and pulled the dollar bid into Powell's final day at the Fed.

ECB is now priced for ~3 hikes while the Fed is on hold — that gap should support EUR, but a 6% YoY US PPI print is rewriting the 'higher-for-longer' trade in the dollar's favor for now.

1.1565 (last week's pivot) is the line; a hold reopens 1.1700. Warsh's first comments as incoming Fed chair are the bigger catalyst — any hawkish nod cracks the floor.

Cable lost 172 pips to 1.3354 — the steepest move of the week — as broad dollar strength stacked on top of unresolved Starmer leadership risk that's still bleeding the gilt curve.

Sterling is being punished on two fronts: a hot US PPI driving USD-bid, and domestic politics keeping a risk premium on every UK asset. The 'twin-deficit' framing is back.

1.3300 round-number support next. BoE speakers and any UK retail sales surprise next week — also a Supreme Court ruling possible today on Trump's reciprocal tariffs that could whipsaw cable.

USD/JPY pushed to 158.60 (+74 pips) as US 10-year yields surged to 4.56% on the PPI miss, pulling capital back into dollars and resetting the carry trade in dollar-yen's favor.

The yen is the cleanest proxy for US real yields right now; with PPI re-igniting term premium and the BoJ still gradualist, the rate gap is widening again — exactly what intervention talk feeds on.

160.00 is the MoF/BOJ red zone — verbal warnings should escalate above 159.50. Below, 157.50 is first support. Any sudden retracement in 10s also caps the move.

Aussie shed 100 pips to 0.7153 as risk-off swept commodities — silver collapsed 8.5% intraday, gold dropped 2.5% — and the dollar regained safe-haven flow on the PPI shock.

AUD is leveraged to the China-commodity story; the Trump-Xi summit ended on positive trade talk but commodities ignored the headline and traded the inflation/yield re-pricing instead.

0.7100 psych level is the next test. China industrial production / retail sales early next week, plus any concrete tariff readout from the summit, decide whether 0.7000 opens up.

Gold dropped $117 (-2.5%) to $4,561 as Iran-Hormuz reopening talk between Trump and Xi cut the geopolitical premium, while US 10-year yields surged to 4.56% on a hot PPI print.

Gold's been priced for tail risk + falling real yields; today's PPI flipped the second leg. With central-bank buying still firm and JPM/SSGA targeting $5,000, dips are still being bid into.

$4,495 (50-day) is the line that decides whether this is a flush or a trend break. Hormuz headlines + Warsh's tone as new Fed chair are the next two binary events.

Silver crashed 8.5% to $77.69 in the heaviest single-day drop of 2026 — a leveraged unwind of the speculative long that built around the AI-build-out copper/silver narrative.

Industrial demand thesis didn't change, but positioning got crowded. Once gold cracked and real yields surged, silver's beta did the rest. This is a positioning flush, not a fundamentals shift.

$74.00 is the 100-day and the obvious shelf. A bounce off there + a stabilising gold tape would set up the 'shake-out, then resume' playbook; a clean break opens $70.

WTI eased 1.8% to $99.38 even with Strait of Hormuz uncertainty in the headlines — Bessent's 'Iran has run out of storage' line and Trump-Xi reopening talk capped the bid.

Oil is caught between two cross-currents: real Hormuz risk on one side, ample physical inventory and the prospect of an Iran de-escalation deal on the other. Today, supply optimism won.

$96.00 (50-day) is the floor that defines the regime; below opens $92. Any concrete Hormuz incident or OPEC+ headline pre-June meeting flips the script instantly.

S&P 500 closed 1.16% lower at 7,414.57, surrendering Thursday's record close after monthly PPI printed 1.4% vs 0.4% expected — the biggest annual jump (6% YoY) since December 2022.

The Fed-easing 'goldilocks' bid that drove the rally is being tested. Powell hands over to Warsh today with stagflation optics getting harder to ignore — exactly the regime risk-parity hates.

7,343 (last week's breakout) is the must-hold. Warsh's first remarks as Fed chair + next week's retail sales/CPI revisions are the gates to either reclaiming 7,500 or trip-down to 7,250.

Nasdaq 100 fell 1.55% to 29,120 as the duration trade got hit twice — hot PPI pushing 10s to 4.56%, plus profit-taking in mega-cap tech after the Trump-Xi summit photo-op rally faded.

AI capex story is intact (Nebius +684% revenue print, MSFT doubling down) but valuations are 'most expensive since dot-com' per Yahoo — so any yield shock hits hardest here.

NVDA earnings are the single biggest event for the index — a clean beat-and-raise can override macro for a day. 28,700 holds the uptrend; lose it and 28,000 is open.

Dow gave back 405 points (-0.81%) to 49,657 after reclaiming 50,000 Thursday — a textbook gap-fill driven by the PPI shock that hit cyclicals and rate-sensitives hardest.

Dow is the cleanest 'real economy + rates' read in this print. Inflation re-acceleration matters more here than in tech — that's why it gave back less than Nasdaq but still couldn't hold 50k.

50,000 is the magnet — recapture and the trend resumes; failure here for two sessions points to 49,200. WMT, TGT next week give the consumer read that decides the cyclical bid.

Bitcoin slipped 1.76% to $79,628, back below $80K as ETF outflows hit a 3-month high ($635M) and dollar/yield strength on the PPI shock pulled risk-asset capital toward Treasuries.

BTC dominance is at 58.3% — capital is concentrating in BTC inside crypto, but rotating out of crypto in aggregate. The 200-day at ~$78K is the line speculators are defending.

$78,000 (200-day MA) is binary — a daily close below opens $74K. Above, $82K is the next supply zone. Any softening in 10-year yields would flip flow back in immediately.

Ethereum lost 1.9% to $2,238, tracking BTC lower as Consensys delayed its IPO and Schwab's crypto launch headlines failed to attract fresh bids into a risk-off tape.

ETH/BTC ratio keeps compressing — the rotation into BTC inside crypto is the story, and ETH lacks a near-term catalyst until the next staking/ETF inflow cycle. Beta to BTC is doing the work.

$2,170 (50-day) is the level to defend. A break opens $2,050. Any sustained BTC bounce off $78K typically lifts ETH harder — relative-value trades come back in fast on stabilisation.

Nvidia sold off 3.7% to $227.03 even with CEO Jensen Huang joining the Trump-China delegation — the rate shock from PPI overwhelmed the China-access optimism into the close.

The AI bid is structural (Cerebras IPO pricing, Nebius +684% on data-center demand), but every yield spike now resets the multiple on the most-loved name in the market.

Q1 earnings are the everything-trade — beat-and-raise on data-center and a clean China commentary can reset the tape; any guide miss takes 220 and then 210 quickly.

Tesla fell 3.1% to $429.57 even with Musk on the Trump-China trip — China FSD approval talk wasn't enough to offset the broad tech-rate selloff after the PPI shock.

TSLA still trades as a high-beta proxy for risk-on AI/EV thematic flows; in a yield-spike + Mag-7 distribution day, the highest-beta name moves the most regardless of catalyst flow.

$420 is the technical line that decides whether this is a pullback in a trend or a top. China FSD regulatory readout from the summit + any robotaxi update are the asymmetric catalysts.

Apple slipped just 0.32% to $297.27 — best-in-Mag-7 — as Tim Cook on the Trump-Xi trip kept the supply-chain optimism bid alive against the broader rate-shock tape.

Apple's the cleanest 'China-thaw' winner in the index; with the summit signaling tariff de-escalation and supply-chain access, AAPL gets the political-discount removed faster than peers.

$295 must hold to keep the breakout structure intact. Any concrete tariff readout from the summit, plus iPhone 17 demand data into next earnings, are the next legs.

Microsoft was a rare gainer, +1.4% to $415.17, as the LinkedIn AI strategy overhaul and another round of AI-infrastructure capex commentary kept the institutional bid firm into close.

Burry and Ives are pitching MSFT as a 25%-off bargain inside a record-tape — that 'cheapest Mag-7' framing is bringing rotation flows in even when broader tech sells off.

$420 resistance is the key level — a clean break opens a re-rate toward $440. Watch Azure consumption color from any analyst day chatter; that's what unlocks the next leg.

Meta dropped 1.27% to $610.59, caught in the broader Mag-7 distribution day driven by the PPI/yield spike, with employee-morale stories adding a small idiosyncratic drag.

META's AI capex story is intact but it doesn't have a near-term de-rate catalyst like AAPL's China thaw or MSFT's bargain narrative — so on a tape sell-off it tracks the index beta.

$600 is the gut-check support — holding it preserves the uptrend, breaking it opens $585. Reels monetization and ad-pricing commentary into Q2 guide are the next moves.

Alphabet fell 1.76% to $394.01, tracking the tech tape lower as PPI hit duration assets and 'AI vs search' narrative pieces resurfaced after a quiet week.

GOOGL is still the cheapest Mag-7 on forward multiples, but it lacks a single near-term catalyst — the market wants confirmation that AI Overviews aren't bleeding query monetization.

$390 is the 50-day and the must-hold. Anti-trust headline risk + any leaked search-share data from Bing/Perplexity could whipsaw — but a hold here sets up a $410 retest.

Amazon fell 2.14% to $261.49 as rate-shock hit both the retail and AWS legs simultaneously, with consumer-discretionary pressure compounded by the PPI inflation surprise.

AMZN's the most rate-sensitive Mag-7 — every basis-point move in 10s feeds through both consumer-spending models and the cloud-discount-rate. That's why it underperformed today.

$258 (50-day) is the defended line. WMT next week sets the consumer read; AWS event calendar for re:Invent-related leaks supplies the upside catalyst.