2025/02/12 - 7th Calendar Week 2025
Another 48h - Strong US Inflation Data Weighs On DXY Today
“the upward trend from Dec. `24 & Jan. `25 is in danger this week!
us inflation data? us retail sales? do they play a role? `or only tariffs?”
A surprisingly strong increase in US consumer prices slowed down Wall Street somewhat in the middle of the week, on this Wednesday, February 12, 2025. The Dow Jones Industrial
DJIA closed on Wednesday with a loss of -0.50% at 44,368.56 points. The broad-based S&P 500 
SP500 fell by -0.27% to 6,051.97 points. The Nasdaq 100 
NDX , which is predominantly stocked with technology stocks, even rose by +0.12% to 21,719.26 points. In January, consumer prices rose by 3.0 percent and reached their highest level in six months. Core inflation excluding volatile energy and food was also higher than expected. Consumer prices are of considerable importance for investors because the US Federal Reserve draws conclusions from them for its future interest rate policy.Year-on-year, consumer prices in the US rose by +3.0% in January, reaching their highest level in six months. "The annual inflation rate in the US edged up to 3% in January 2025, compared to 2.9% in December 2024, and above market forecasts of 2.9%, indicating stalled progress in curbing inflation. Energy costs rose 1% year-on-year, the first increase in six months, after a 0.5% fall in December, mainly due to gasoline (-0.2% vs -3.4%), fuel oil (-5.3% vs -13.1%) and natural gas (4.9% vs 4.9%). Also, prices for used cars and trucks rebounded (1% vs -3.3%), cost accelerated for transportation (8% vs 7.3%) and fell less for new vehicles (-0.3% vs -0.4%). On the other hand, inflation steadied for food (2.5% vs 2.5%) and slowed for shelter (4.4% vs 4.6%). Consumer prices are of considerable importance for traders and/or investors because based on them - not only, but especially - the US Federal Reserve Bank draws conclusions for its further monetary policy. Which? I don't know that! You have to take the Fed's men and/or women at their word in their public speeches - as I do. And make your own conclusions! Anyway, in an environment of higher interest rates and/or yields, it is also important to concentrate on classic, good, organically growing companies that know how to finance themselves - and even pay dividends. Everything else has to be accepted as a risk in such a current environment (relatively high inflation and yields, including the key interest rate).
- Will The First Uptrend Of 2025 Be Held This Week??
That was the question last week - and we have to answer it with YES. And will ask ourselves this week too. To learn something new (old) this week too.
“In economics, contingent, time- and context-bound theories! Second, because our understanding of reality is imperfect, the criterion by which choices may be judged is not fully within our grasp. As a result, people will not necessarily make the correct choice and, even if they do, not everybody will accept it as such. Moreover, the correct choice represents merely the better of the available alternatives, not the best of all possible solutions. New ideas and interpretations may emerge at any time. These are also bound to be flawed and may have to be discarded when the flaws become apparent. There is no final answer, only the possibility of a gradual approximation to it. It follows that the choice between alternatives involves a continuous process of critical examination rather than the mechanical application of fixed rules.”
George Soros
- Will The First Uptrend Of 2025 Be Held This Week Once Again??
The uptrend is important because it started in the last week of the past 2024 - at 107.587 points, from 2024/12/20 (last low 2024) and/or 107.739 points, from 2024/12/30 (2nd last low 2024). Because as long as traders and/or investors are trading and/or investing in the
DXY above this extended trendline of 107.400 points and/or 107.650 points, we can argue that the price action will continue to trend bullish.110.176 : 2025/01/13 - Annual High 2025
109.881 : 2025/02/03 - Intraday High
108.337 : 2025/02/03 - Intraday Low
108.583 : 2024/12/31 - Annual High 2024
107.769 : 2025/02/12 - last price action
107.348 : 2023/10/03 - Annual High 2023
105.192 : 2024/11/06 - Trump Election Night
The
DXY opened this calendar week with a bullish GAP. But until yesterday evening, the price action in the DXY had fallen slightly over the course of the week so far - also below the bullish GAP of 108.126 points & 108.242 points at the beginning of the week. And that's only to open again today, on the day of the US Inflation release, with a smaller bullish GAP between 107.931 points & 108.008, just below the bullish GAP at the beginning of the week. And that all ahead of the US Inflation data, which came out higher as expected from the most analysts. [url=]"The annual inflation rate in the US edged up to 3% in January 2025, compared to 2.9% in December 2024, and above market forecasts of 2.9%, indicating stalled progress in curbing inflation." What I expected - but I didn't expect the reaction of the traders and/or investors who sent the price action south during the day so far after the publication. The 108.253 points were also the previous weekly high in the trading hour during the publication - and that only to be able to witness the current weekly low, at 107.703 points, just 4 hours later, before some minutes. Right now, the price action of the DXY is at 107.681 points. What now? I don't know! As I said, I expected higher US inflation, also higher as the most one, but didn't want to play cash-strapped, even cassandra - be the bearer of bad news, let alone press the alarm button. So let us wait for PPI Data tomorrow, and/or even US retail sales on Friday. And let's hope as bulls that the ongoing upward trend holds - from the original upward trend on December 6th, 2024 at 105.420 points & 106.969 points on January 27th, 2025 - which is just more or less still around 107.500 points today also. Because with a price action below 107.500 points, let alone below the 2023 annual high of 107.348 points, I will also have to reassess the price action of the DXY - which tends to be bearish. But let's wait until today's trading session end on Wednesday, and/or until the end of this calendar week.With best wishes
and good intentions:
Aaron
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