Last week was very hot for EUR/USD. Retail sales and CPI pushed the dollar up, while EUR dropped with investor sentiment hitting its lowest level since 2010 and industrial production falling by the steepest amount since November 2019.
Coming week is very important for all markets. All eyes are on Jackson Hole summit. We can only keep guessing what statements they will make. So, I believe we should stick to technical analysis and trade smaller lots this week. DXY hit daily resistance and technically should pullback. However, there is no signal yet. Lower high would be good to go short on a short-term basis.
Cycles suggest we should see a decline in silver. Besides, we have bearish divergence on the daily chart. Targets for this trade 16.600 and 15.900. Divergence is considered to be completed when RSI hits 30. But I think it is better to take profits partially at key support as we are in a strong bull run. That’s my plan for managed accounts.
Dow bounced up at and of last week. But I believe it didn’t bottom yet. We can see a bit of move up at the beginning of the week and then drifting down. Take profits are at key support levels on the daily time frame. Many traders are waiting for a bear market, but it is too yearly. Yes, there are signs of recession, but it never happens fast. I think in one or two weeks we will get another buying opportunity in Dow.
Wishing you a great week!
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