Global macro overview for 08/03/2018

The markets have recently been severely damaged by the protectionist threats from Donald Trump. The position of the US President's strong emphasis on trade policy issues hampers a stronger rebound of the dollar. The market behaves in this situation like a beaten dog. He got so many kicks from Trump that he would be suspicious about his hand, which wants to pet him, that is, to speculate about the announced eased position (especially against Canada and Mexico). Optimism can be seen in the sharp drop in USD / CAD, but for example, the rise of Wall Street slowed down before an important level of 2725 - 2730 points.

Investors cannot decide what to make the leitmotif of quotations. From the more hawkish Fed and fiscal policy, which are to push the US debt profitability to new highs (over 3.0% in the case of ten-year securities), or for fear of trade wars. It is noteworthy that both factors are negative for the world of emerging markets. In many of the markets in this catalog, extensive items have grown up, which in the current chaos will crumble and this process can be violent and painful.

Let's now take a look at the SPY (SP500 ETF) technical picture at the H4 time frame. The market has made a lower high at the level of 279.01 and then dropped towards the level of 264.70. Recently, the bulls tried to rally again, but so far the price was capped at the level of 273.42. This will be the key short-term technical resistance for the price to break out higher towards the level of 275.27. If the bulls will permanently fail here, then the test of the nearest technical support at the level of 269.94 is unavoidable as the market conditions looks overbought.

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