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On August 26th, according to South Koreas *Chosun Ilbo*, South Korean DRAM export prices continue to soar, with AI-driven HBM production squeezing the supply of conventional memory. Data shows that from August 1st to 20th, the export price of South Korean DRAM reached $92,183 per kilogram, a 401% year-on-year increase and approximately 12.5 times higher than the low point in January 2023. Goldman Sachs predicts that the DRAM supply gap will widen from 5.0% this year to 5.9% next year, and believes that "HBM required for AI servers and high-capacity server DRAM are absorbing limited production capacity, leading to a further tightening of conventional DRAM supply." TrendForce predicts that by the end of next year, Samsung, SK Hynix, and Micron will account for 30% of total DRAM wafer input for HBM production, but HBM will only account for about 13% of actual DRAM bit supply. Memory manufacturers warn that the AI-driven DRAM and NAND supply shortage may continue beyond 2027. SK Hynix stated that from a supply perspective, 2027 could become "the most severe shortage year in the history of the memory industry." Goldman Sachs predicts that the supply shortage may continue until 2028.August 26th - According to Spanish government sources, the Spanish government plans to introduce stricter regulations on water, energy, and cybersecurity due to the surge in data center projects within the country. These new requirements have been incorporated into a draft decree, which will be open for public comment this week. Thanks to abundant renewable energy resources and vast tracts of open land, Spain has become one of Europes hottest hubs, attracting billions of euros worth of AI infrastructure-related projects. Sources indicate that the large number of projects allows Spain to select the most efficient and sustainable facilities in terms of sustainability and cybersecurity, which is the target of the upcoming regulations. According to the draft decree, data center operators must be established within the EU, and the data and metadata they process must remain within the EU. Mechanisms must be established to control access from third countries; stricter regulations will be implemented for data centers handling public data or data involving national security.Federal Reserve Bank of Barkin: If debt continues to increase, investors will eventually stop buying (US Treasuries) at some point.Federal Reserve Chairman Barkin: The U.S. debt problem will eventually face a reckoning.Sources say air raid sirens have been sounded in Kyiv, Ukraine.

The Dollar Index's Top-to-Bottom Reversal Indicates a Potential Momentum Shift

Drake Hampton

Apr 11, 2022 10:52

On Friday, the US Dollar fell versus a basket of foreign currencies after gaining more than 100 points for the first time in over two years. It reached a high of 100.20 during the session, its highest level since May 2020.

 

Despite the fact that it formed a potentially bearish closing price reversal top, it ended the week up 1.3 percent. Throughout the week, the dollar index was mostly supported by a rise in US Treasury yields and a weaker Euro.

 

The June US Dollar Index closed at 99.753 on Friday, down 0.007 or -0.01 percent. The Invesco DB US Dollar Index Bullish Fund ETF (UUP) closed at $26.68, an increase of $0.01 or 0.02%.

 

On Friday, the US Treasury 10-year yield surpassed 2.7 percent for the first time in three years, aided by the likelihood of more aggressive Federal Reserve tightening. Additionally, this week's release of the Fed's March meeting minutes revealed that "many" members were prepared to raise rates in future months in 50-basis-point increments.

 

In other news, the Euro was under pressure as the election battle between President Emmanuel Macron and far-right contender Marine Le Pen tightened in France, the Euro Zone's second-largest economy. Macron continues to lead polls.

Technical Analysis of the Daily Swing Chart

According to the daily swing chart, the primary trend is upward. However, Friday's closing price reversal top implies that momentum is about to move downward.

 

A move above 99.745 will confirm the price reversal top at the close. This could initiate a 2-3 day adjustment. A break of 100.200 will invalidate the chart pattern and suggest the resumed uptrend. The primary trend will revert to the downside upon a break of 97.730.

 

Minor values range from 97.730 to 100.200. The nearest support level is at its 50% level, or pivot, of 98.965.

 

The critical support level is the long-term Fibonacci retracement level around 98.200.

Scenario of the Bear

Persistent movement below 99.975 indicates the existence of sellers. Taking out 99.745 will confirm the price reversal top at the close. If this generates sufficient downside momentum, expect the selling to extend towards the minor pivot at 98.965.

Scenario of Bullishness

Sustaining a move over 99.975 indicates the presence of buyers. The initial objective on the upside is 100.200.

 

If 100.200 is breached, the closing price reversal top will be invalidated, signaling the resumption of the uptrend. If buying is sufficiently strong, we may see an acceleration to the upside, with the next big objective of 100.560 – 100.930.

 

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