This could well be an interesting week- one for the history books.
During most of 2022, we saw a very rare occurrence of migration towards the U.S. Dollar triggered by several coinciding events. Increasing inflation, global political instability, and ongoing ripple effects of COVID.
This was demonstrated clearly in the markets, when we saw the USD become the central axis uniting all asset classes. If the dollar moved, so did almost every other major instrument against it in some sort of well-coordinated dance.
From October 2022 however, things appeared to ease, with asset classes uncoupling from the USD. We saw Crude Oil drop, Gold climb, and even the JPY relax.
Now, the markets appear to be sliding back into a similar co-ordinated dance. Could this mean a return to the same types of market moves we saw dominate most of last year? Yes, quite possibly.
We still don’t have inflation under control, Russia is still in Ukraine, with increasing tensions now against NATO nations, and even COVID still rampant in many parts of the world.
How does that translate to the charts?
Well, it means traders could move on the banks of a falling (read: trending) series of markets; Majors in FX, Commodities, Indices and even Cryptos.
Charts such as these could come into serious focus: