Are we going to have a breakthrough week in the financial markets?

American Stock Index Dow Jones Industrial Average has had eight consecutive weeks of relegation behind him. Earlier it happened in 1923, that is, a few years before the biggest economic crisis of the century. Can history repeat itself almost 100 years later?

The downward trend is not limited to the Dow Jones. Other known US stock indices - S & P 500 and Nasdaq 100 - have only a slightly shorter series of reductions behind them. Falling for seven weeks in a row, they recorded the worst period in 21 years, and have already lost more than 20%. in relation to its peaks.

In addition to stock exchange shares, precious metals and cryptocurrencies also seemed to be cheaper over the past two months.

An important sign: bond rates have fallen

However, there are reasons for a possible turning point in the situation and an attempt to break the bad series in several mentioned markets, already this week. The trend change could be based on the belief that investors have already discounted a cycle of interest rate increases in the United States, assuming that Federal Reserve eventually it will raise the interest rate to 3,00-3,25 percent. during the year.

10-Year Yields US Treasury Bonds peaked in this area, surpassing 3,10 percent at one point. Today, their interest rate has dropped to 2,80 percent. This seems important because the lower the US bond yields, the more attractive the stocks and other risky assets may be to investors.

Waiting for Wednesday evening

On Wednesday (May 25) at 20 we will get to know the minutes of the last meeting FOMC, i.e. the body responsible for shaping monetary policy in the US.

It may bring new clues to the Fed's plans. But also to reassure investors that the cycle of interest rate increases is over at the already mentioned level of 3-3,25 percent. and encourage the flow of capital towards exchanges, precious metals or cryptocurrencies.