Markets seem to adjust to a new behavior model - Market Overview

Markets seem to adjust to a new behavior model - Market Overview

Stocks appear to be less volatile, thus having a smaller impact on the performance of other financial assets.

Major stock futures have been posting record-breaking results driven by good economic data, huge fiscal stimulus, and expectations regarding an imminent economic recovery.

However, many of these stocks are already in the overbought zone if we analyze what the daily and weekly RSI indicators indicate. In the case of USA30, the weekly RSI is already slightly above the 80 area, a level that was only reached at the beginning of 2020, just before the crash before the pandemic's start. At the moment, there are no signs of retreating, but in this area, the indices could be more vulnerable.

An influencing factor in recent weeks has been the rebound in U.S. Treasury Bond yields. The concern regarding Fed’s potential rate hikes appears to hurt the valuation of stocks and, therefore, could cause corrections in the indices. Expectations of inflationary outbreaks could also have a negative effect. However, the market seems to have accepted as valid Fed's low-interest rates views for the moment.

This could signal a change in the investor's market approach and could be the reason why the previous correlations are lost. This will take some time to settle and obviously could change if new factors appear in the equation.

The U.S. Treasury Bond Yields rebound slightly today, rising above the 1.60% in the case of the 10-year Treasury note.

In the currency market, the U.S. Dollar weakened against all major currencies, despite long-term rates remaining high. The only exception was the USD/JPY pair, with the dollar strengthening against the Japanese currency.

After two weeks of continuous declines and having reached overbought levels on the daily chart, the pair rebounded to the current resistance zone of 108.50 and could only gain upward momentum if it exceeds the zone between 109.00 and 109.30. This scenario would only be possible by maintaining a positive risk sentiment in the market with long-term interest rates in the United States at the current levels or slightly higher.

Sources: Bloomberg, investing.com.

Uvedené informace zpracovala společnost Miguel A. Rodriguez a nepředstavují investiční doporučení. Uvedené informace poskytujeme v rámci naší marketingové komunikace pouze pro informační účely, nebyly připraveny v souladu s právními předpisy upravujícími šíření nezávislého investičního průzkumu a nevztahuje se na ně zákaz obchodování před šířením investičního výzkumu.

Uživatelé / čtenáři by se neměli spoléhat výhradně na informace, které jsou zde prezentovány, a měli by také provádět vlastní výzkum / analýzu a také četli skutečný podkladový výzkum.

Společnost Key Way Investments Ltd neovlivňuje ani nemá žádné informace při formulování zde obsažených informací. Obsah je obecný a nezohledňuje individuální osobní situaci, investiční zkušenosti nebo současnou finanční situaci.

Společnost Key Way Investments Ltd proto nebere žádnou odpovědnost za ztráty obchodování z důvodu použití a obsahu zde uvedených informací. Výkonnost v minulosti není spolehlivým ukazatelem budoucích výsledků.