Will the war between Israel and Iran affect the dollar? What will be the decision of FOMC?
Retail sales this morning were a swing and a miss. We expected a decline in retail sales of 0.5% but instead got a decline of.9%. And this doesn’t help the dollar’s case which continues to be in a downtrend this year. And retail sales gives us an idea of the state of the consumer which while has been pretty good in recent months. So people are feeling a little bit more conscious about their spending and spending a little bit less at this time. And so we do see the dollar index still looking pretty weak overall.
From a price action standpoint, we’re sitting at a longer term level of support here uh around the 98.5 level. We did narrowly go underneath that level, but have mostly just sort of consolidated sideways in the meantime. However, momentum still seems to favor the bears, and any jump in the dollar index, in our opinion, would most likely be an opportunity to fade the move and to continue to sell this currency until something drastically changes in the fundamental story.
Israel and Iran trade strikes on the fifth day of the conflict. And this is what we mean by geopolitical conflict. We still see headlines taking place here. Of course, a tragic situation. We never like to see these sorts of things happening. and it does tend to cause the price of gold to go a little bit crazy. So that’s why we think we’re back to these all-time highs and any further signs that rate cuts are coming, we
think could really push price over the edge.
The US stock indices continue to grind higher here, but they’ve been kind of boring in the last few weeks. They’ve been mostly just trading sideways back and forth uh and just sort of pausing here just below the previous all-time highs. Since the big dip that
we thought it was a buying opportunity and we do continue to think that we still have room to squeeze higher and actually put in fresh highs this year.
People are going to ask him about the tariff situation. Does it cause him to still be as hesitant now that some deals have happened? And We are very curious to see what he says there. If he says that, if he gives any ground and says like, “Hey, things seem to be uh kind of cooling off in that that may uh relieve some of our uncertainties around the inflation that could come with tariffs.
