Another 48h - Bulls Are Hopeful Again After Today's Data

2025/02/27 - 9th Calendar Week 2025
Another 48h - Bulls Are Hopeful Again After Today's Data
“all us data from today gives no hope for interest rate cuts!
now time to become bullish again? why? no longer bearish?”

New tariff announcements from US President Donald Trump put some strain on the German stock market this Thursday, February 27th, 2025. But there wasn't much damage. After the strong previous day, our leading German index, the Dax , fell by -0.61% to 22,654 points in the afternoon. The day before, he had at times approached his record from the previous week of 22,935 points to just over 100 points.

What happened tonight? Nvidia numbers! No - US President Trump verbally took out the hammer again and now wants to impose tariffs of 25 percent on imports from the European Union - "for cars and all other things". The official announcement should follow very soon. Yesterday evening, shortly before the closing bell on Wall Street, the Financial Times published: "Donald Trump threatens to impose 25% tariffs on EU goods." I'm starting to wonder too! Won't this be an economic policy goal for Trump? A fumble, as they say in the NFL? Dealing with tariffs is fundamentally not a bad thing - a useful instrument to better regulate and/or control agriculture, production, industry, manufacturing, trade, and even services. But that has to be calculated - otherwise it will be the cause of a new wave of inflation. My friend CFD online broker analyst is not a fan of Trump anyway, let alone Nvidia - he thinks he's a poser who doesn't deliver. "On Wednesday, Trump said the levies on Canada and Mexico would take effect on April 2, suggesting a possible delay in the tariffs, which were scheduled to be imposed next week." Which would confirm his thesis - but let's wait and see! As far as US inflation, the US foreign trade balance, and/or even the US budget deficit are concerned. And because the US Democrats and US Republicans won't begrudge him that. I have always defended Trump - and even outspokenly supported him for these reasons. Also in the case of its customs policy - his tariffs. Even though I may repeat myself like an annoying coach, even a teacher, and press my keyboard impatiently like an NFL head coach with his headset on the sideline, I am absolutely passionate at this point - like a banker and/or economist. Because as I wrote days and/or weeks ago, if the US tariffs get into account starting next month March 2025 and the US consumer dont get a better and/or cheaper Made In USA alternative for the goods, the goods and/or products will even be +...% more expensive? And this could be the reason for the next US inflation wave! Because tariffs are fundamentally a useful instrument for every economy only if at the same time there is an internal national offer that is even better and/or cheaper for its own consumer! Otherwise the calculation doesn't add up - imports fall, the economy shrinks and/or a new wave of inflation rises if consumers don't consume less because demand will get greater than supply. But Trump and his team certainly know that too. Which is why I'm fundamentally optimistic about Trump and the DXY as well as WallStreet . And if I am not wrong, I thought that this was also the reason why US voters voted for him. However, I personally was happy that the Americans gave him a second chance. But I admittedly no longer believed it after the 2022 midterm election. Because from the outside it seems, at least in my opinion, that there is a lack of political will. Last but not least, I have just read a very worthwhile article on Foreign Policy, by Agathe Demarais - which I don't want to withhold from you at this point: "It is hard to keep track of all the tariffs that the U.S. President Donald Trump is announcing or enacting these days. On top of the 10 percent tariffs that he imposed on China on Feb. 4, Washington has announced across-the-board steel and aluminum tariffs effective March 12 and plans to discuss reciprocal tariffs on all countries on April 2. On the same day, a 25 percent tariff on Canada and Mexico could come into effect, in addition to a tariff specifically targeting U.S. car imports. Yesterday, to round things off, Trump said that he will “very soon” announce a 25 percent tariff on imports from the European Union."

Will The Bulls Come Back Above 107.348 Points, The Annual High Of 2023?

That was the question of the last 8th calendar week. And we have to answer this question with NO - because the last price action on Friday, the 21st february 2025 was 106.641 points. Answering this question was instructive because a price action below would and will also retrospectively confirm the trend reversal formation of the price action development above the annual high of 2023, namely even the 107.348 points.

“Demand may be a suitable subject for psychologists, supply may be the province of engineers or management scientists; both are beyond the scope of economics.”
George Soros

Will The Bears Defend The Terrain Under 107.348 Points Once Again This Week?

This is the question of this 9th calendar week. And it is important because it would confirm the trend reversal formation above the 2023 annual high, at just 107.348 Points points, in the second week in a row.

110.176 : 2025/01/13 - Annual High 2025
108.583 : 2024/12/31 - Annual High 2024
107.348 : 2023/10/03 - Annual High 2023
107.243 : 2025/02/27 - last price action
105.441 : 2024/11/06 - Trump Re-Election Day
Traders and/or investors only sent the DXY during today's trading session, on Thursday, the 27th February 2025 at 106.665 points (some minutes after the closing bell on WallStreet). What are - 0.105 points under the Annual High of 2023, from the 3rd October 2023, at 107.348 points. And/Or + 1.806 points above the Intraday High on Trump Re-Election Day, from the 6th November 2024, at 105.441 points. What is fundamentally important in this respect is to be able to detect whether the short-term bearish trend reversal formation above the 2023 annual high of just 107.348 points will be confirmed this week. And we tend to continue to see slightly falling price action towards Trump's Election Day Intraday High of 105.441 points. Or will the bulls be starting to fight back this week? And traders and/or investors who will send price action above 107.348 points again by the weekend?

109.881 : 2025/02/02 - 1st Short Downtrend 1st Leg
108.523 : 2025/02/12 - 1st Short Downtrend 2nd Leg
108.523 : 2025/02/12 - 2nd Short Downtrend 1st Leg
107.381 : 2025/02/19 - 2nd Short Downtrend 2nd Leg
107.381 : 2025/02/19 - 3rd Short Downtrend 1st Leg
106.789 : 2025/02/24 - 3rd Short Downtrend 2nd Leg
106.566 : 2025/02/14 - Last Week Before Low
107.243 : 2025/02/27 - last price action
106.334 : 2025/02/20 - Last Week Low
106.126 : 2025/02/23 - This Week Low
Be that as it may, in addition to the general picture this week, if we analyze the price action in a little more detail without losing track at the same time, the three short-term downward trends are groundbreaking. And these were all broken up bullishly higher today - after new US figures were published. Which one was it? I don't know! "The core personal consumption expenditure price index in the US increased by 2.7% from the previous period in the final quarter of 2024, accelerating from the 2.2% increase in Q3 and above the advance estimate of 2.5%. At the same time, the headline rose by an annualized 2.4%, up from the 1.5% increase in the previous three-month period and slightly above the advance estimate of 2.3%." Could well be possible - because these numbers don't fall. “So there’s no reason to cut interest rates,” bulls may have thought. In the case of durable goods, on the other hand, I'm pretty sure that traders and/or investors could have said to themselves: "Okay, it's not that bad at the moment! Even better than feared" - and sent the price action to a current new weekly high. "US Durable Goods New Orders YoY is at 4.12%, compared to -4.03% last month and -0.77% last year. This is higher than the long term average of 3.26%." Because economic growth has also been spared from today's figures. "The US economy expanded an annualized 2.3% in Q4 2024, the slowest growth in three quarters, down from 3.1% in Q3 and in line with the advance estimate. Personal consumption remained the main driver of growth, increasing 4.2%, the most since Q1 2023, in line with the advance estimate." So that the price action today in the can be explained logically and consistently - without coming across as a braggart ;) Be that as it may, now it depends on whether the bulls manage to recapture the annual high in 2023 at 107.348 points. But more on that tomorrow - after the PCE data. Which will give us more information about possible (not) impending US inflation. However, it is 17:22 CET (Central European Time) and the price action of the is at 107.243 points. What is only - 0.105 points under the Annual High 2023. So from today's perspective, I also think there is a greater probability that we will end up above the Annual High 2023 at 107.243 points by the weekend.

With best wishes
and good intentions:
Aaron

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