Strong Dollar & weak indices
27 February 2023
Last trading week started badly for the indices and ended on that note, too. On most of them, we have new, mid-term sell signals, which makes the start of this week bullish. S&P 500 managed to break the up-trendline connecting higher lows since October. DAX is still above the up-trendline, but is currently breaking the horizontal support on the 15250 points; and the Dow Jones managed to set new yearly lows.
On the currency market, the week starts with a new bullish wave on the American Dollar. The new monthly lows can be detected with, for example, EURUSD or AUDUSD, while USDCHF and USDJPY are currently trading close to or on the yearly highs. The trend will most probably continue this week, too.
The stronger dollar is definitely hurting precious metals. On Friday, gold lost 0.5% and silver dropped by 2.3%. Platinum did even worse, collapsing by almost 4%. On the other hand, oil seems pretty resilient to the recent power of the USD. The sentiment on the oil might be negative in general, but the price stopped declining and has still some space before hitting the new yearly lows.
The calendar today is not busy, as is pretty common for Monday. We already learned retail sales data from New Zealand, who disappointed with a drop of 0.6%, in contrast to an expected rise of 0.2%. Later on, before the start of the American session, we shall find out the Durable Goods Orders data from the USA and further down the line the Pending Homes Sales number as well. Durable Goods Orders are expected to come at -3.7%, while Pending Homes Sales are expected to rise by 0.9%.