We are again in this bizarro world, where good news is bad news for Wall Street and vice versa. Investors reacted negatively to this week's upbeat economic data, since they sustain prospects of further tightening by the Fed. Markets still expect the Fed to pause in two weeks and that the terminal rate has already been reached, but there is less comviction around the latter.
Despite some recent softening, the US economy is strong and Wednesday's rise in ISM Services PMI (to 54.5), underscored this resilience. At the same time, employment conditions have showed signs of cooling, but the labor market remains tight and yesterday's report revealed another drop in weekly jobless claims.
The strong state of the economy and the labor market and still high inflation support the higher-for-longer narrative. Speaking just ahead of the communication black out period, Ms Logan (voter) said a September skip "could be appropriate", but warned that such outcome "does not imply stopping". 
SPX500 dropped after these upbeat releases, also weighed by the fall of Apple's stock - its biggest constituent – after the Wall Street Journal reported that China banned the use of iPhones for government officials . China is an important market for the tech giant and the news come just days before the launch of iPhone 15.
The index runs a losing week and breached the EMA200, which threatens the upside momentum and creates risk for deeper correction towards 4,337, although we are cautious around sustained weakness. SPX500 already finds support today and has not lost the ability to push for new 2023 highs (4,640).
Senior Financial Editorial Writer
Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.
With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.
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