Indices Continue to Descend
02 March 2023
On the first day of March, we witnessed significant weakness in the American Dollar, consistent with the signals that began to appear on many charts towards the end of February. Although the USD dropped yesterday, it was not the weakest currency in the pack; that title went to the British Pound, which continues to decline at the beginning of the European session today.
Yesterday's calendar was packed with Manufacturing PMI data from major global economies, with mixed numbers that lacked any clear trends. The most significant data point - the ISM Manufacturing PMI - came in line with expectations, providing no shocks. Today's calendar is less busy than yesterday's, with the primary focus on Eurozone inflation data expected to come in at 8.3%. Additionally, we are anticipating a speech from RBNZ Governor Orr later today, which will likely influence the NZD, which is currently one of the weakest currencies in the pack.
Indices continue to descend, which should come as no surprise given that major supports have already been broken, and we are currently experiencing a legitimate mid-term bearish trend. The DAX index is holding up reasonably well, still trading above the 15250 point level; however, selling pressure is increasing. Once this support is broken, we should see a significant slide south, at least towards 14800 points.
Commodities had a good session yesterday, with Gold seeing a third consecutive bullish day, and Oil seeing a second consecutive bullish day. However, Thursday morning brings us a small correction attempt, and we anticipate that this will continue throughout the day as buyers take a rest.