Panic in the Markets: Will US Inflation Data Calm Investors?

Panic in the Markets: Will US Inflation Data Calm Investors?
The initial attempt to calm the markets proved unsuccessful yesterday, as fears surrounding the collapse of Silicon Valley Bank (SVB) took hold. Despite a positive start to the European session, major indices quickly plummeted to new mid-term lows, with DAX breaking below the key support level of 15250, SP500 falling back below the downtrend line, and FTSE smashing the 7660 support. Tuesday's gains, while present, were modest compared to Monday's optimism, and the chances of a successful reversal remain unknown.
Today, traders can look to the US inflation data for direction, with a projected drop from 6.4% to 6% on a yearly basis. If this occurs, it could signal that the Fed's action has taken effect, and they may pause further rate hikes, which could alleviate some of the stress on the fragile economy. This would be good news for risky assets, given the current uncertain situation with American banks.

Speaking of collapsing, oil prices have taken recent news negatively, with WTI flirting with yearly lows and Brent breaking below the downtrend line and the lower line of the flag, triggering a sell signal. In contrast, gold is finally acting as a proper safe haven, with Friday and Monday's sessions witnessing a tremendous surge, with gold rising almost $100/oz in two days.

On the forex market, the USD is experiencing a correction following the SVB turmoil. Initially, the consensus was that there would be no further rate hikes, but traders are now questioning this approach. However, this change in sentiment is not universal, and some traders are likely taking profits rather than switching sides.
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