After my last note there was a little rallye taking place due to good earnings reports. But today markets have changed. Inflation data suggests that the Fed needs to hike rates even beyond the comfort line and hit growth. So the story in the market has changed.
The USD didn't strengthen any more but weaken. Hence, interpreting the market there will either be a sell-off of bonds and equities which will cause the USD to lide downwards or a stop in rate increases with is USD negative anyway. However, it remains hard to tell which currency the USD should be shorted against as all economies will be hit by higher than expected inflation.
Commodities are stronger which is no surprise in spite of inflation fears. They are a natural hedge.
Stocks went down because market participants fear that growth could be hurt by the rate hikes which will probably real estate (the main consumption driver) hit the strongest. The slump today doesn't look like profit taking from last week.
I had to close out my TecDAX short. I fundamentally believe that there are only hope stocks in the index except solar shares. Solar is in a huge bull market and Solarworld has surprised positively. Hence, I have a very sour taste while being short in this index.