ANALYSIS

Daily Analysis: Dollar

Sell-Off Continues as
Stocks Still in Holiday
Mode
Published 5 hours ago on December 30, 2017
By Mate Cser

Friday Market Recap

Asset Current Value Daily Change
S&P 500 2668 -0.65%
DAX 12917 -0.48%
WTI Crude Oil 60.12 0.47%
GOLD 1305.00 0.61%
Bitcoin 14,350 -1.75%
EUR/USD 1.2003 0.51%
As cryptocurrencies are still all the rage,
traditional financial markets have been in
holiday mode, especially US equities, with
the major exchanges experiencing very low
volumes and narrow trading ranges, despite
a sizeable last-minute drop, as most trading
desks were closed until next week. With
investors sitting on lofty yearly gains, the
sell-off is barely visible on the charts, and
the overall technical setup is also stable.

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That said, the under the hood trends that
emerge in the holiday period are often
important, even given the small size of the
movements, as without the algorithms, and
the day-trading noise, the markets are
usually more natural.
 DOW 30 Futures, 4-Hour Chart Analysis

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If that will be the case this time around for

2018, then we should brace ourselves for a
flat to negative stock market, a plunge in the
Dollar, and a big period for gold and oil, as
these have been the apparent short-term
trends.

The Greenback got hit from all directions

recently, with the EUR/USD pair breaking
above 1.20 again, gold topping $1300, and
the Dollar index nearing its September lows
after a two-month rally. The Japanese Yen
has been relatively weak amid the Dollar
bashing up until this week, but some risk-on
currencies gained an impressive amount of
ground, like the Aussie and the Canadian
Dollar.

Dollar Index (DXY), 4-Hour Chart Analysis

European stocks still look vulnerable, with

the Euro’s strength weighing on them, and
both the EuroStoxx 50 and the DAX declined
by almost 1.0%, which is quite a margin
given the overall volatility in the markets.
The indices on the old continent are also
well below their all-time highs, while their US
peers are consolidating just below record
levels.

DAX, 4-Hour Chart Analysis

Cryptocurrencies
The crypto segment had two hectic days
before the weekend, with another round of
rotation between the majors, and this
time Ripple being the beneficiary of
capital flows. The rest of market was
choppy with a bearish tilt in the case of most
of the coins, but the lows from last Friday are
still well below the current price levels, with
BTC stabilizing near the $14,500 level. The
support zone near $13,000 level should be
in the crosshairs of investors for now, as a
break below that could open up the way
towards the mini-crash lows and the historic
$10,000 level.

BTC/USD, 4-Hour Chart Analysis