Inflation Reports Loom Large as Treasury Yields and Rate Expectations Hang in the Balance

The shortened trading week is underway with limited scheduled economic data releases. The New York Fed's 1-Year Inflation Expectations will be released at 11:00AM ET, followed by several Treasury announcements and auctions throughout the session.

The key focus this week will be on Thursday and Friday's inflation reports, which could significantly impact Treasury yields and rate expectations. The Producer Price Index (PPI) report on Thursday will provide an update on producer level inflation and underlying input cost pressures.

Friday's Consumer Price Index (CPI) report is likely to be the primary macro catalyst of the week, as it will provide evidence on consumer inflation and influence expectations for the Federal Reserve's next policy moves. A meaningful surprise in either report could lead to a repricing in Treasury yields, the dollar, and equities.

The current prices of several major assets are: SPY around 767.50, QQQ at 718.50, AAPL at 318.00, MSFT at 496.25, NVDA at 230.75, GOOGL at 336.25, META at 613.50, and TSLA at 354.75.

The article also discusses the technical levels for each asset, including potential support and resistance levels. For example, if SPY loses 767.50 with conviction, sellers may press into 761.50, followed by 755.50 if weakness continues.