Starbucks Corporation (SBUX) Stock Forecasts

Summary

One of our recent themes has been a break in the U.S. Dollar Index (USD) and its bullish implications for emerging markets. USD topped on January 13 and broke its uptrend on January 21, with the initial pullback falling from $110 to $106.80. The greenback snapped back to $109.75 on February 3, but failed right at former trendline support. USD was sitting just below $108 Wednesday, has held its 50-day average so far, but looks like it is tracing out a double top. The dollar peak coincided with a peak in Treasury yields across the curve. The COT data was a big reason we got cautious on the greenback. The iShares Emerging Markets (EEM +5% in 2025) bottomed on January 13 and broke its downtrend off the October 7 peak. We have seen a five-day/13-day exponential moving average (EMA) crossover buy signal and a completed small inverse head-and-shoulders pattern. Emerging markets are highly, negatively correlated with USD. The iShares China Large-Cap (FXI) bottomed on January 10 and broke over $33.25 on Monday to complete its small base. It would certainly be nice if some other global stock markets would come to life so investors can broaden their portfolios away from the U.S. as they look for alpha in places that have lagged for many year