It’s been a wild day on Wall Street with stocks trading in a whipsaw fashion. With only a few hours to go in the U.S. session, the DJIA DOW (+2.02%), S&P 500 SPX (+0.95%), and NASDAQ (-0.49%) are mixed. In addition, USD Index futures have broken into bullish territory, up 0.32% on the day. At this hour, the divergence between the DOW and S&P 500 with the NASDAQ is eyebrow-raising.

During the early hours of the U.S. Monday session, there were several peripheral economic metrics released to the public. Here’s a quick look at the highlights:

Event                                                                        Actual              Projected            Previous

Wholesale Inventories (MoM, Jan.)                        1.3%                   NA                          1.3%

Wholesale Trade Sales (MoM, Jan.)                       4.9%                   1.4%                        1.9%

The key takeaway from this group of figures is the jump in Wholesale Sales of 4.9%. This is a big move forward and has contributed to the lowest inventories-to-sales ratio since 2014. This suggests that consumption is solid while production isn’t what it was pre-COVID-19.

For USD Index bulls, 2021 has been a welcome reprieve. Values are well off yearly lows (just above 89.000) and driving toward 92.000.

USD Index Breaks Above Weekly Resistance

Below is a weekly chart for March USD Index futures as of last Friday’s close. Rates settled above the Bollinger MP and Weekly SMA ― an event that hasn’t occurred since last spring’s COVID-19 panic.

Overview: For the time being, a bullish bias is warranted toward the USD Index. Although the long-term downtrend remains valid, rates have broken into intermediate-term positive territory. If the Fed decides to change its tone at the March or April meeting, 2021 may pan out to be a strong year of recovery for the Greenback.