State of the Market: investors flee from risks

At the beginning of trades on Tuesday, the market remains negative. The US session closed on a negative note because of the general flight of investors from the risks. Against the backdrop of a decline in profitability of the government bonds (10-year government bonds -2.10) and a general decline in stock indices (Dow 30 -4.60, S & P 500 -4.10), the dynamics of flights from risks remain on the market, which supports the assets of the safe haven .

At the same time, the US currency is restrainedly strengthening against the main competitors, despite the decline of the US state bonds and a clear weakness before the assets of the safe haven. Against the backdrop of very overbought yen, franc and gold, the US currency is undervalued, despite the continuing risks in the US.

The dynamics of the market and the American as a whole depends on the general sentiment of the market. Negative start of European stock exchanges will only keep the existing negative sentiments. At the same time, a further decline in European stock markets is unlikely, which may cause a slowdown in the sale of risky assets and the strengthening of the US dollar.

The US dollar index is traded with the strengthening, remaining near the levels of significant resistance 89.60 and 89. 80. At the same time, regarding the American, the potential for strengthening remains if it fixes higher. Thus, breaking through the level of resistance 89.60-50 will indicate the possibility of further recovery of the American to the levels of 90.00 and 90.30-40. At the same time, the American will have to overcome significant resistance.

Graph of the US dollar index. The current price is 89.40.

Hanzenko Anton