At the beginning of this week, two events that occurred over the weekend were in the focus of the market. The first was the news of Credit Suisse being acquired by another Swiss bank, UBS, with the involvement of the government through guarantees. This gives the markets some respite as the chances of new surprises decrease, but the costs of the acquisition will undoubtedly be felt in separate segments of the financial market. Firstly, there are the losses for minorities, as the announced price at which the buyout will take place is more than two times lower than the closing price on Friday - 0.76 CHF per share versus 1.86 CHF per share. A separate group of Credit Suisse bondholders will also suffer. All of this promises waves of volatility as the market takes into account this new information.

The second event was a statement by major central banks that they will increase the provision of liquidity, primarily through dollar swaps ranging from one to seven days. There have been no signs of significant dollar liquidity shortages recently, so this step looks more like a precautionary measure. Although the risks of new episodes of financial stress are decreasing (as central banks are building up a safety cushion), at the same time, the probability increases that the Fed will try not to deviate from its previously planned course of raising rates, although it is expected that the pace of increases will be slowed. Futures on the rate are pricing in a 50% chance of a 25-basis-point increase next week, so in the event of a hawkish outcome, the dollar is likely to react upwards.

For now, the market is playing up optimism associated with central bank interventions and expectations of an earlier end to the cycle of monetary tightening, primarily by the Fed. This environment is negative for the dollar, so the developing bearish momentum in the dollar price is likely to determine the direction of the US currency this week. We could easily see a breakthrough of the 103 level on the dollar index, but buyers should begin to concentrate in the 102.50-103 area, anticipating a hawkish Fed decision. In early February, buyers appeared in this area after a technical rebound of the dollar from the 100.50-101 area, which subsequently pushed the price up to 105 points. This also increases the chances that the 102.50-103 zone will be perceived as support:

Today, the price of gold shot up above $2,000 per troy ounce after news of Credit Suisse's acquisition. Investors bought into the safe-haven asset, anticipating increased volatility and potential shocks in the market, but this risk-off approach was clearly excessive. Gold lost all of today's gains and even fell below the opening price. In my opinion, the decline will continue because the market may currently underestimate the Federal Reserve's determination to raise interest rates. The target for the metal is the range of $1,920-$1,930 per troy ounce.