Talking Points:

- An aggressive rally started to show in the US Dollar around this morning’s European open. There was a release of European confidence numbers around this time, but it would appear that some of this pull is also coming from month and quarter-end flows. This is a holiday shortened-week with Good Friday on the calendar, and this also coincides with the final week of Q1. This means that both month and quarter-end flows are showing as markets in many economies prepare to close down on Friday. In Europe, markets are also closed on the following Monday in observance of the Easter holiday.

- US Stocks staged a rally yesterday that led-into a global jump in the overnight session. Has the world stepped back from the proverbial ledge? It’s still too early to say for sure, as this bump in stock prices could be partially-driven by month and quarter-end flows. Interesting, however, is the fact that US Treasury bonds remain weak with yields very near multi-year highs.

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Stocks Come Back, S&P 500 Bounce Drives Global Rally

As we open Tuesday of our holiday-shortened week, markets have shown some interesting volatility as we approach the end of Q1. As we mentioned yesterday, with this being a holiday week in observance of Good Friday combined with both month and quarter-end flows, the prospect of ‘peculiar’ moves was a bit higher than usual[4]. That has led into this morning’s rally in the US Dollar after a string of weakness that ran into last night; along with the bullish push across global equities after yesterday’s aggressive rally in American stocks on the heels of Friday’s nasty sell-off.

From Friday Flop to Monday Motivation, Buyers Return to the S&P (Hourly Chart)

s&p 500 hourly chart Chart prepared by James Stanley[5] Dollar Rally Kicks Off with the Euro Open The big item as we open the US session is a rally in the US Dollar that’s shown over the past few hours[6], coinciding with this morning’s European open. Dollar weakness remained fairly prominent through yesterday’s US session and well into Asia, with a quick test below the 89.00 level just before Europe opened for the day. But after that, USD[7] strength began to show and hasn’t yet exhibited any signs of abating. At this point, DXY[8] has rallied up to a zone of prior support, the same zone that we’d looked at yesterday for the ‘range within a range’. US Dollar via

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