Another 48h - DXY Bullish Before Trump's Inauguration On Monday

2025/01/19
Another 48h - DXY Bullish Before Trump's Inauguration On Monday
“`24 & `23 highs were left behind in the run-up to Trump's inauguration!
what do most traders or investors expect this week? bullish? bearish?”



Donald Trump invites his friends to the party - and the invitations have been sent. In this way, the future US president is directly defining who he counts as his allies and who he doesn't. Some of the names scheduled to present for the inauguration on Monday, January 20th are no surprise. The new triplet of Generation the tech billionaire has developed a friendly relationship with the Italian prime minister, and the Argentine president, in turn, shares the X-mogul's economic ideas. If you will, the conservative right-wing Christian Trump has joined forces with the liberals abroad, in our so-called West - who are all united by their love for Israel, the Jews, and Israel's right to exist. And beyond that, of course, money and political power - the USA as the locomotive of our so-called West. What a banker, publisher and, above all, meanwhile also a familiar friend of mine described as a once-in-a-century opportunity back in 2016, when Trump was first elected. Giorgia Meloni wasn't the only one who received an invitation among the European heads of government. Also Viktor Orbán, who visited Trump in Mar-e-Lago. Also expected are Nigel Farage (Reform Party), Éric Zemmour (Reconquête), Tom Van Grieken (Vlaams Belang), Santiago Abascal (VOX) and former Polish Prime Minister Mateusz Morawiecki. Our German AfD top candidate Alice Weidel was also invited, but cannot keep the appointment because of the ongoing election campaign. As has now been announced, co-chief executive Tino Chrupalla will travel to Washington instead. The situation is similar for Herbert Kickl (FPÖ), who received an invitation but is sending a representative due to the current Austrian conditions. Interestingly, however, Trump, unlike Musk, does not seem to want to rely solely on the AfD. The CDU sends Jürgen Hardt to the ceremony. Political necessity allows for nothing else: The new US administration has also understood that Friedrich Merz is most likely - in whatever coalition - to become our next chancellor, here in my homeland Germany. Merz was already transatlantic before his Blackrock connection and, as CDU leader and future German Chancellor, will have to make friends with Trump despite all the wars of words.

In terms of domestic policy, what was already apparent in the summer of 2024 is now being realized: the US economic elites are defecting from the Democrats in favor of Trump. It goes without saying that Elon Musk belongs to this avant-garde. But after the attack, numerous multi-billionaires had already indicated that they could live with a Trump term. Jeff Bezos' intervention in the Washington Post's election recommendation was a clear signal. And Mark Zuckerberg announced the big turnaround for Facebook a few days ago; Incidentally, one that was already hinted at during the election campaign when he announced his neutrality and even expressed sympathy. The fact that Bezos and Zuckerberg are present at the inauguration shows that the tech avant-garde is not ideological, but rather pragmatic and business-oriented. And Trump sees himself first and foremost as the US president - and then as a conservative, freedom-loving leader of our so-called West. Trump's most exciting decision was inviting Chinese President Xi Jinping. Relations with China were strained during Trump's last presidency. Of course - the proud USA, which sees itself as God's chosen superpower in the world, not only in our so-called West - is also realizing the rise of China, like that of the friendly panda. Who doesn't hurt a fly - but knows how to defend himself when his interests are threatened from outside. Great foreign policy in the best sense - hopefully peaceful, civilized and not military. Just economic war - just price conflicts (over goods and services, which will also show up in the price action on the financial market). I'm very excited about it, so no new 4XSetUps from me. During the election campaign, Trump repeatedly made economic war-like announcements in Beijing's direction. Nevertheless, Trump is not a military gamecock - unlike all his predecessors since World War II! And also sent a super clear signal of respect, which must have positively surprised even the red mandarin with a Mona Lisa smile. Unfortunately, Xi will not be there in person. But by sending the front row to XI, the People's Republic of China made it more than clear that they got the message. With Vice President Han Zheng and/or Foreign Minister Wang Yi too, Beijing is sending top-class replacements - the best that Beijing - after XI - currently has politically, to Washington! Other representatives from India, Japan and some South American countries will also be there. As well as from Europe! So we're waiting - full of anticipation - to see what happens next week? I do it - I'm already full of anticipation. Hope . you too!

“But I don't like working. I do the absolute minimum that is necessary to reach a decision. There are many people who love working. They amass an inordinate amount of information, much more than is necessary to reach a conclusion. And they become attached to certain investments because they know them intimately. I am different. I concentrate on the essentials. When I have to, I work furiously because I am furious that I have to work. When I don't have to, I don't work.”
George Soros

Even though I may be unfairly perceived as a party crasher, I would still like to point out that the stock market as a whole in the USA is valued far too expensive! And the yield curve also predicts a recession! Of course, that doesn't have to happen - but it increases the likelihood that it will happen: US stock market crash & US recession! But I'm not assuming that today (yet). "As of September 30, 2024, the S&P500 is currently trading 71% above its modern-era historical trend value, (about 2.0 standard deviations), indicating that the market is Strongly Overvalued." This matters because it is a basic model based on an fitted exponential growth rate for the S&P 500. To continuously stay above the trend line suggests that the stock market must continue to grow at a continuously higher growth rate. Such explosive growth is not sustainable over long periods. "The US Treasury Yield Curve was recently inverted, meaning short term interest rates were higher than long term interest rates. This unusual occurrence, called a yield curve inversion, has historically been a very reliable indicator of an upcoming economic recession. Since World War II "Every yield curve inversion has been followed by a recession in the following 6-18 months, and recessions are naturally correlated with decreased stock market returns." That's why take care with any long positions in the stock markets and/or operate only with stops - in your own interests.

110.176 : 2025/01/13 - Monday New 2025 High
109.966 : 2025/01/02 - Last Annual High 2025
109.533 : 2025/01/02 - 1st Annual High 2025
109.405 : 2024/12/17 - last price action
109.206 : 2025/01/03 - 1st High After 1st High 2025
108.602 : 2024/01/15 - Last Week Low
108.583 : 2024/12/31 - Annual High 2024
107.587 : 2024/12/20 - Last Low Of 2024
107.348 : 2023/10/03 - Annual High 2023
105.441 : 2024/11/06 - Trump Re-Election Day High
It is obvious that the majority of traders and/or investors want to see the DXY price action go up! Because of Trump? I don't know! But we know from the chart history that since the night of his re-election, things have been trending bullish towards the northeast. Even from the 6th November 2024 intraday high with 105.192 points. The most important price action areas above you can see over here. What is noticeable - at least in my humble opinion - is the upward trend after reaching the annual high in 2023 at 107.348 points, from 2023/10/03. Which was confirmed in the form of a W trend reversal formation in this year 2025 in the first days of this year below the annual high in 2024 at 108.583 from 2024/12/31! Why is this so important? Because I can imagine that at the beginning of the year many people thought that we would probably not have such a low price action in the DXY during 2025. Because after Tuesday, the 7th January 2025 traders and/or investors send the price action since Wednesday, the 8th January 2025 even always above the Annual High 2024 of 108.583 from 2024/12/31. Which was also confirmed in the past calendar week, with the weekly low on Wednesday, the 15th January 2025 at 108.602 points.


With best wishes
and good intentions:
Aaron



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