Gold 1837,425
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EURUSD 1,2075
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DJIA 30687,50
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OIL.WTI 52,185
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DAX 13757
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One look at the chart below is enough to scare those who are short the US dollar. Technical analysis tells us that the first support for the EUR/USD can only be seen at 1.16.
EURUSD
Why might the dollar rise sharply?
As an example, we can look at the chart of the S&P 500 index, where a reversal is also visually outlined. The decline of the main US stock index by only 3-5% can lead to a global sell-off in foreign stock markets. Further, there will be a traditional flight to the dollar, which acts as a defensive asset.
Why is the situation in the US stock market so important for the dollar now? The thing is that there are statistics according to which the negative close of January of the S&P 500 index indicates that the same dynamic is likely to continue throughout the year. And given the fact that a large number of stock buyers are leveraged, the situation could get out of control very quickly.
We understand that a similar decline as last spring will not happen. The Fed will come back on stage, reassure everyone and promise to buy a new load of arbitrary, even extremely toxic assets.
Monday is a holiday in the US. Normally when there is no trading in America, during the Asian and European sessions, there are small movements in the EUR/USD pair. It will be all the more interesting to see what happens in the market tomorrow. A sharp downward move and the removal of stops behind the 1.20 mark is possible.
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