This week will be full of economic insights, but the big data will come on March 1 and 3, when the ISM manufacturing and services indexes are released, respectively. The ISM Manufacturing survey is expected to rise to 48 from 47.4 last month. Meanwhile, the ISM manufacturing prices paid index is expected to rise to 46.5 from 44.5 in January. The job report is not due this week and is delayed until March 10.

This will put extra focus on the ISM reports as they will provide February’s first inflation and employment reading. But overall, I think these two reports are unlikely to do much to reverse the current trend of rising rates and a stronger dollar. However, hotter numbers could result in trends in rates and the dollar growing stronger.

Dollar

The dollar has broken a downtrend, and it probably has room to run between 105.75 and 106 before running into any meaningful resistance.

2-Year Rate

Meanwhile, the 2-year has also broken out; I think it’s heading above 5%. The weekly chart shows no major resistance level until the 2-year hits 5.1%, a rate last seen in 2007.

Corporate Bond Fund ETF (LQD)

The LQD corporate bond ETF has fallen sharply and is at support currently. A break of support at $105.50 would signal that the LQD ETF has further to fall, with gaps at $104 and $100.80 potentially serving as the next stops.

20-Year+ Bonds (TLT)

The TLT ETF has a similar look to the previous chart, but the TLT ETF has further to fall before testing support at 99.50. But with a gap at $94.50, a further decline seems likely.

S&P 500 (SPY)

The S&P 500 broke below the October uptrend by gapping below it, completing the bump-and-run reversal pattern. The index isn’t oversold yet based on the RSI, and it could have much further to drop, given how much rates have risen thus far. For now, the next major support level comes at a long-term downtrend of around 3,900, followed by 3,780.

Biotech ETF (IBB)

The IBB biotech ETF has broken down after failing to move meaningfully above resistance at $135. Biotech is a good proxy for where the market thinks rates are going because these companies tend to be long-duration growth assets, and higher rates affect them the most.

Therefore, watching the IBB can provide insight into where equity investors think rates are heading. Currently, it appears that the IBB is likely heading lower to around $121, which means rates may be heading higher.

Internet ETF (FDN)

The FDN First Trust DJ Internet ETF is back below $136, which had served as strong resistance for much of the fourth quarter of 2022. It appears that the January rally may have been a false breakout attempt. Unless the FDN ETF can quickly re-establish that breakout, it is likely to head lower toward $118.

Adobe (ADBE)

Adobe finished below all the lows between the end of November and the beginning of January, around $325. This suggests a potential bearish change in the trend for the stock. Furthermore, there is a significant gap to fill at $300.

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