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Long road ahead, goodbye V and hello WAs daily cases around the world increase, the fact that in 2020 we will not see any return to the pre-pandemic level becomes more and more obvious. Lucky if this happens in 2021. In light of the US labor market data released last week, there were some interesting forecasts from the Congressional Budget Office (CBO). The US unemployment rate could reach 4.4 percent only in the fourth quarter of 2030. By the way 4.4% is much higher than the historically low level of 3.5 percent that was observed in the USA before the outbreak of COVID-19. This is about the long road ahead. So goodbye V-shape and hello W (with any luck). CBO gave their updated and very gloomy vision on US GDP growth in 2020: -5.9%. This is even worse than the updated forecast from Goldman Sachs, which is expecting a 4.6% slowdown in the US economy in 2020. JPMorgan Chase & Co. forecast global debt growth of $ 16 trillion by the end of 2020, and the total amount will exceed $ 200 trillion. This is to the question of why stock markets do not fall against the background of such forecasts of economic growth rates and its current state. In fact, there is an unprecedented injection of money into the stock market. How this will end is understandable, the whole question is when the bubble will burst (sooner or later, debts will need to be repaid, which means selloffs in the stock market). The Chinese stock market index CSI 300, for example, has grown by 14% over the past 5 days, and added another 5.7% yesterday after state-owned media in China set up an advertising campaign for investing in the Chinese stock market. This growth is even greater than in December 2014. By the way, the Chinese stock market collapsed in 2015 (just a fact).
FOREXCOM:NAS100Short
by Trade24Fx
1
Waoh, Australin Dollar is strenghten as US is in problems!!!That is my proyection in H4 timeframe on how we see AUD for the next hours in each H4 candlestick, and more importan is to see in H1 timeframe when the price is going to down a little it's make a pull back. For now, there are not reccomendation to operate and trade this par, we need to hope the confirmations, because there are two probabilities: 1. The price is going to break up, make a pull back ang go down the up the price 2. The other possibility is tha price is going to down until the $0.6899 USD approximattely and then, make a buy with confirmation of bullish candlestick, so important then. So, but in generally we see that Australian economy is recovery and there are not news of this country, but, technically we see to proyect a recover of the AUD currency. And also, for tomorrow we have a important economic calendar of 3 bulls that mean a extreme volatil movement of the AUD for tomorrow when will be the meeting about the Reserve Bank of Australia it's will have a meeting this week about the monetary policy and rate decision. There are a commentary is what expert called a remain at the current all-time low of 0.25% of rate interest on signs the downturn will not be as bad as expected. A more upbeat to from the central bank and recent gains in commodity prices such as copper will boost the "Aussie". So, in midterm we see as expert of financial market is that Australin Dollar is into the recovery and we hope that this currency are up the price in the next months, that we hope. And also, about the situation in United States, the states of the union are growup the number of cases of coronavirus as New York, California and Florida had a lot cases in the past weeks, so this indicator is bad for the United States. Also, why not we created a special analysis for Saturday about the proyection of this par AUD/USD in weekly and monthly, and Daily too to see in long term. That is so interesting in my mind to created it.
Long
by harisonhbn9718
EUR/USD is up for German factory indicator: That is bullish!!!Easily, the only we need to hope is the price is leave at the 0.382% of Fibonacci, and remember and most importan is wait the candlestick group when have a confirmation of buy off. That is very important to trade this par. Also, yesterday I make a little updated of this analysis and we found out a double top compared as Bitcoin do in the movement too. The double top it's show in the red arrox, these 2 arrows are the double bottom and wow, the prie is go up near of 1%. That is good!!! But, I didn't enter because the most is to be patient and hope what is the price conduct, because it's not necceary because the price also can to down as up now happen in Tokio or Assia session trade. Also, if you want to check our my related ideas as EUR/GBP that have my fundamentals, you can to click down of my related ideas of the par Euro/Sterling Pound, and included US Dollar/Canadian Dollar I add too. So, be patient that EUR/USD is reach donw the 0.382% of Fibonacci to entry in long, in the next hours I will going to check this par as all open pars in trades. Because all pars that I have opened from yesterday in cryptocurrencies and Forex from Thursday of the past week I going in profit and earning in this 4 trades open up.
Long
by harisonhbn9718
Week in a Glance: NFP, pandemic, best quarter, etc.The main event of the past week was the publication of data on the US labor market. The NFP data came out very impressive: + 4.8 million with a forecast of +3 million. But the overall minus in NFP since the start of pandemic is still about 15 million and it is already obvious that it is unlikely to be able to level it before the end of the year. And this means that there will be no quick economic recovery. One of the factors contributing to this is the second wave of epidemic un the US. More than 50K new cases per day is a serious reason for concern. As a result, a number of states are tightening measures with all the ensuing consequences for the labor market and the economy as a whole. U.S. chief infectious disease specialist Anthony Faucci announced the figure of 100K new cases per day in the nearest future. Last week was marked as the best quarter for the US stock market over the past few decades. We have already noted that this happened just before the dot-com bubble collapsed, as well as before the stock market crash in 1987. So, this is not a cause for joy, but rather an extremely alarming signal. Tesla bypassed Toyota in terms of capitalization. Which, in our opinion, is a clear sign that the markets have totally lost their minds: Tesla produces 25 (!) times less cars than Toyota, and its revenue is 10 (!) times less. In general, it's time to sell Tesla , while there are still crazy people buying it at $ 1,200 per share. The Brexit talks again ended with nothing. So, pound sales this week remain our basic trading idea for the FOREX. As for the general trend in the positions, we will give preference to purchases of the dollar, first of all against the Australian and Canadian dollars. In the stock market, we will continue to look exclusively for sales opportunities as well as in the oil market. As for the upcoming week, it will be exclusively desaturated on fundamental events. By and large, this will be one of the last weeks of rest, the calm before the storm, which will almost certainly begin with the start of the earnings season in the USA and the publication of US GDP data for the second quarter.
Short
by Trade24Fx
2
US labor market, sanctions and the end of free cheeseThe main event of yesterday was the publication of data on the US labor market for June. In fact, it was a month of active reopening of the US economy, respectively, signals were expected from the labor market about quick restoration of the economy. On the one hand, the data on NFPs pleasantly surprised: with a forecast of +3 million in fact, the increase in NFPs amounted to +4.8 million. But on the other hand, if you look at the data in the context of the accumulated effect, it is still extremely negative. The labor market is still minus about 14 million in terms of the NFP and this is very serious. The fact is that we will hardly see the figure of 5 million next month, which means that restoration will take not 2-3 months, but the whole of 2020 and possibly part of 2021. And all other things being equal, that is, the pandemic will recede and the states will continue to reopen. In the meantime, the US is updating records for the number of new infections, and some states continue to curtail programs to open economies. That is, in fact, next month we will not see figures similar to yesterday, but in general we can see even a negative number in the graph of new jobs created. In general, such a large-scale crisis in the US labor market, has not yet spoken yet its word for only one reason: government support. Checks from the Government have not yet allowed the following logical chain to be realized: no work, no salary, no money, nothing to pay bills, nothing to buy goods with all the ensuing economic consequences in the form of a banking crisis, falling demand and, consequently, falling producer revenues, etc. So, we recall that currently July is the last month when the Government provides “free cheese”. If Congress does not vote to extend the current one or adopt a new aid act, then very soon we will see what is the real price of 20 million unemployed for the economy is. Meanwhile, the U.S. House of Representatives passed a bill imposing sanctions on banks that deal with Chinese officials involved in cracking down on demonstrators for democracy in Hong Kong. Let us look at the reaction of China, since all this is fraught with a new round of rising tension between US and China.
FOREXCOM:NAS100Short
by Trade24Fx
4
Best quarter, vaccine and US labor market dataThe second quarter for the US stock market was the best over the past few decades. It seems like a more than obvious buy signal. However, we have the opposite opinion. For us this fact is a direct indication to sales. The problem with modern financial markets is that they have the memory of a goldfish. Let’s dive into the past a little bit. The high-tech Nasdaq Composite has showed the best results since the fourth quarter of 1999, soaring by 30.6%. Recall that the fourth quarter of 1999 was the last period of growth before the collapse of the dot-com bubble. Right after the fourth quarter of 1999 Nasdaq index fell by 4 (!) times. And if it seems to you that this is nothing more than a coincidence, then consider the Dow Jones Index, for which the second quarter of 2020 turned out to be the best quarter since the first quarter of 1987. What is 1987 for the US stock market? This is the year of the largest one-day fall in its history. 1987 was the year of the Black Monday, when the Dow Jones Index lost 22.6% in a day, which provoked a severe crisis in the US stock market and around the world too (Australian stock market has lost 41.8% by the end of October, Canada - 22.5% , Hong Kong - 45.8%, Great Britain - 26.4%). That is why when we see news headlines with phrases such as “the best quarter in decades,” it becomes completely clear that the current bubble has reached the terminal stage. Another signal in favor of this is Tesla's first place among automobile companies in the world by capitalization. A company that produces dozens of times less cars than Toyota costs more than the latter. The degree of absurdity has clearly reached a critical point. So, stock market sales continue to be the main trading idea of 2020 for us. By and large, now the whole question is in the trigger. That is, an event that will provoke a change of market sentiments. In general, there are enough reasons, starting from the pandemic and its second wave, ending with the economic crisis. So, today's data on the US labor market, in view of their traditional significance as a whole, are also suitable for the role of a trigger. Although the data most likely will not be disastrous, so we don’t really hope that everything will start today. We have much more hopes for the earnings season for the second quarter, as well as the US GDP data for the second quarter. So, the ebd of July, in our opinion, can become a turning point for the US stock market. But back to the statistics on the labor market. In March-April, about 21.5 million in NFP were erased. Yes, May restored 2.5 million, but this is still MINUS 19 million. That is, almost any figure below 5-7 million is, by and large, a negative signal. For example, if the forecasted 3 million will come out. What does it mean? That the labor market will need another 5-6 months (!) to just restore the losses incurred, in fact, during 1 month. This is all you need to know about the quick recovery of the US economy, and in the world as a whole. As for the rising optimism in the financial markets yesterday, it was triggered by news of a successful vaccine test. This time, the Pfizer and BioNtech vaccine proved to be safe during early trials and ensured the formation of antibodies to the virus. This is not the first surge of optimism against the background of such kind of news. Previously, this was information about the tests of Remdesevir, as well as the results of vaccine tests from Moderna. But the problem is that the pandemic is here and now, and the vaccine is something in the unknown future. That is, here and now this news does not solve anything.
FOREXCOM:NAS100Short
by Trade24Fx
2
Australian terms, economic confidence and FacebookYesterday, the financial markets were relatively calm. For the panic moods, corresponding dynamics in the number of cases in the world and the USA is needed. And since the beginning of the week in this regard traditionally inspires elements of false hope, the markets were in no hurry to be afraid. But they did not have special reasons for relief as well. Economic confidence in the Eurozone in June did not justify expert forecasts: The economic confidence index in June is 75.7 with a forecast of 80.0 and a May value of 67.5. This is not much incorporating the fact how much talks were about a quick recovery and fast return to normal. The pound was under pressure yesterday. The reason is the same - Brexit. Johnson said over the weekend that Britain is ready for trade relations with the EU “on Australian terms” (trading based on standard WTO rules with a number of special agreements for certain goods) if no agreement will be reached. In general, both sides continue to raise rates. But the time is ticking out. So, the concerns of investors are clear. Even Johnson’s statements about his readiness to actively help the British economy through a sharp increase in government spending on investments for infrastructure projects did not help the pound. Among the other news, it is worth noting the natural hunting on Facebook, organized by companies around the world. Inadequate Facebook policy in terms of hateful speeches was chosen as a formal reason. Well, in fact, everything is trite: many companies do not have money, and they are forced to save costs. But you can’t admit it out loud, because it is fraught with consequences. Using this scandal, they saved money, and pretended to be socially responsible and generally on the side of the people.
Short
by Trade24Fx
Week in a Glance: second wave in the USA, IMF and new trade warsLast week began with an outbreak of short-term panic after a White House adviser said in an interview that the US-China trade deal is over. Trump made a rebuttal rather quickly and the markets quickly compensated for the losses. Nevertheless, the problem of trade wars did not end there: Trump administration said that the United States was going to set new tariffs of $ 3.1 billion on export from France, Germany, Spain and the UK. In response to this, the EU will have no choice but to impose its own sanctions in response. That is, trade wars will expand geography and scope. The main event of the week and the main newsmaker again became a pandemic. The situation in the world continued to deteriorate rapidly: the number of new cases in the USA at the end of the week reached 50K, in Brazil about the same number, and India approached the mark of 20K. And if for Brazil and India this is the first wave, then the United States is faced with a full second wave. Unreasonable removal of quarantine restrictions and exit from the lockdown say their words. Judging by the current dynamics, the second wave promises to be even worse than the first one. At least the current highs are already higher than the highs of late April. A week of such growth and the US should prepare for a new lockdown. Actually, some states have already suspended the lifting of restrictions. In general, our recommendation to sell in the US stock market is finding more and more reasons. Speaking of reasons. The IMF last week released updated forecasts on the global economy in 2020. Global growth is projected at –4.9 percent in 2020, 1.9 percentage points below the April forecast. The COVID-19 pandemic had a more negative impact on activity in the first half of 2020 than anticipated, and recovery is projected to be more gradual than previously projected. At the same time, the IMF notes the fact that there is a large gap in prices on financial markets from reality and warns about a correction in financial markets. This week, markets will continue to monitor the situation with the pandemic and their sentiment will be directly determined by the numbers for new cases of disease. In addition, we are waiting for the publication of official statistics on the US labor market: NFP and unemployment on Thursday will be the focus of markets.
DJ:DJIShort
by Trade24Fx
4
Fear of lockdowns, US GDP and its future, oil perspectivesThe pandemic situation in the world and individual countries continues to deteriorate. The result of this was the emergence of a new phobia in the financial markets - fear of lockdowns. The likelihood that countries will begin to close again is high enough. At least if you look at the dynamics of new cases in the United States, where they exceeded the mark of 40K per day, which is a new historical maximum. Amid such dynamics, the University of Washington in Seattle recounted the possible number of deaths in the United States by October. Now it is 180,000, which is almost 50% worse than the previous estimate of 122,000. If the US economy will be closed again, neither the Fed nor the new stimulus from the government will help the US stock market - sell off will be inevitable. But even in the current reality (without a second lockdown) everything does not look very good. Recent US unemployment figures show that around 20 million people continue to receive unemployment benefits. At the same time, over the week the number of new applications again turned out to be near 1.5 million. Yesterday, the final estimates were published on US GDP growth in the first quarter: a decrease of 5%. Recall that this is only the beginning of the problems for US GDP, and not their peak. Most experts believe that the fall in US GDP will be measured in double digits. Leading analysts estimate the rate of decline at 30-40%. Which, of course, is absolutely unthinkable, but in a month, it can become a reality. The growth of the stock market amid such data is beyond the scope of our imagination. So, we continue to remind about our recommendation to sell on the US stock market, and other countries too. In general, the threat of repeated lockdowns carries risks for a number of assets, including oil. The validity period of OPEC + in the current volume is gradually coming to an end (recall, it is valid until the end of July, May and June have already passed), that is, a couple of million barrels per day of additional oil will appear in the market in a month. But the lockdowns will provoke another sharp drop in oil demand. This will inevitably lead to a sharp drop in oil prices, as the oil storage facilities are still full (for three consecutive weeks, US oil stocks are growing). So in the current environment, we are probably inclined to sell oil.
DJ:DJIShort
by Trade24Fx
2
US and EU #tradewar revived: $3.1 bn on tariffsTrump administration wants to put tariffs on German, French, English and Spanish exports to the US, amounting $3100 million. Tomorrow, US opens a query period lasting one month, until July 26. These tariffs could be set as 100% of the produce value. A new trade war has been started due to Airbus subsidies and revived taxes topic to american big tech companies such as Google, Facebook or Amazon. If this $3100 million see green light, Euro could be dismantled to 1.10, leaving back that sideways movement started on June 8. Looks like America has realised Euro is gaining strength (maybe too much for their taste) against major pairs since May 14.
Short
by alexinve
Trade Wars, US problems, and IMF ForecastsThe main event of yesterday can be considered the publication of the IMF updated forecasts on the economic growth in the world in 2020. As expected, forecasts were revised downward. A decline in global GDP is now projected at 4.9 percent in 2020 (1.9 percentage points worse than the April forecast). In general, according to the IMF, the COVID-19 pandemic has done bigger negative impact on activity in the first half of 2020 than anticipated, and recovery is projected more gradual than previously expected. Among other news, it is worth noting information that the United States can set new tariffs for European exports in the amount of $ 3.1 billion. That is, the markets did not have time to breathe out after statements by the White House adviser that the trade agreement between the USA and China is over, and they have another blow. But this time it is a new front in trade wars. Obviously, such a move by the United States will provoke a symmetrical response from the EU with all the ensuing. In general, one more reason to worry about the future of the global economy. The news about the pandemic this week are extremely negative: the outbreak of diseases in Germany, the growth of new cases in the US and the country's inability to leave the plateau of diseases. As for the positive, we can note the latest information from the Ifo Institute, which demonstrated that business expectations in Germany have been rising for the second month in a row. On the other hand, this news was offset by a survey of employers in the UK, which showed that a quarter of workers are likely to lose their jobs after returning from forced leave when state support ends in September.
Short
by Trade24Fx
1
EURUSD: New safe haven against major pairs?This morning, I saw an educational video from transparent-fx and showed that the EURUSD is shaping an inverse H&S in D chart and indeed it is. Besides, in the H4 chart it comes from shaping a non-inverse H&S what makes you realise that the pair is experiencing a sideways movement since June 8. If the figure is finished, by June 30 EURUSD could reach 1.14. In addition, fundamental readings have been quite strong, coronavirus is contained in most of the european countries and even though Germany has seen a surge in covid19 cases, Merkel is still the Chancellor so she knows how to deal with this. On the other side of the Atlantic, US and Latin America are not improving which is why investors are running away from america (which has recently seen a spike in bankruptcies filing in the past week, 13-20 June) and embracing euro as the only safe currency since Japanese yen lost that condition when covid19 outbreak sparked the markets around Feb 24. So EURUSD might be the safest currency (inveur, investing.com's euro index is staying around 101, highs not seen since 2014) for this summer-autumn only, until everything drops down again.
Long
by alexinve
Slow recovery, IMF forecasts and common movementsYesterday, quite a few business activity indexes were published in Germany, the Eurozone, the UK and the USA. Indices were for June; therefore, their information was crucial to understand the pace of recovery. Apparently, the recovery process is not explosive, but gradual. At least the indices were below 50, that is, economic activity continues to decline. It is worth noting that indicators came out better than forecasts, which means events are developing not in the worst way. Given these data, as well as Trump's comments that the US-China trade deal remains valid, the markets were again optimistic and common movements typical to these market sentiments were detected: stock markets were growing, the dollar was declining, commodity markets were strengthening and the currencies of developing countries grew. At the same time some deviations were detected: safe haven assets were mostly increased. We thing this might a signal of reverse in the market sentiments soon. The positive mood of the markets yesterday was strengthened by the WTO report, which says that thanks to the actions of the governments, the worst-case scenario for the global economy can be avoided. Speaking about the actions of governments, we note that more than $ 2.3 trillion of the total amount allocated by the EU to help companies remained untouched. We traditionally remain pessimists. The lack of a quick recovery suggests that 2020 as a whole will be exceptionally disastrous for the global economy. So, there is nothing to be happy about right here and right now. In this regard, it will be interesting to read updated forecasts from the IMF on the pace of development of the global economy. The Fund warned a couple of weeks ago that we should expect a worsening of previous forecasts. The whole intrigue is how much worse the forecasts will be (in April, the IMF announced -3% shrink in the global economy by the end of the year).
FOREXCOM:NAS100Short
by Trade24Fx
2
New outbreaks, Germany pumps, the deal is overPerhaps the main news provider yesterday was Germany. On the one hand, an outbreak of pandemic, on the other - a signal in favor of a “hard” Brexit. To begin with, the reproduction rate jumped sharply over the weekend. From a rate of less than 1, the reproduction rate rose to area 3. This is due to an outbreak at the slaughterhouse where tests of 1300 workers gave a positive result. If we add to this the continued deterioration of the situation in Brazil and India and an increasing number of signs of a “second wave” in the USA, we get an extremely threatening picture for the world as a whole. Another reason to concern was provided byy White House adviser Peter Navarro, who said that the US-China trade deal is “over”. And although after this there were statements that the “over” was not quite the “over”, and Trump said that it was not the end at all, the sediment remained. And the markets began to think about a new round of trade wars between the two world largest economies. So, we see no other options than to recommend sells in the stock markets. But back to Germany. The German Deputy Finance Minister said that it is necessary to prepare for the worst and urged banks to be prepared for the “hard” Brexit, adding that there was a very strong risk of a difficult situation in the future. We think this message is not for German banks, but as the last warning to the UK, which continues to show miracles of inflexibility in the EU negotiation process. And apparently, the EU is already fed up with it. This is negative news for the pound, so we will sell it today.
Short
by Trade24Fx
6
Week in a Glance: Bank of England, pandemic and the second waveLast week was full of various events, both economic and political, such as the meeting of the Bank of England, Powell’s testimony in Congress, the armed conflict between China and India, protests in the United States, the outbreak of pandemic in Beijing and a general worsening of the world epidemiological situation. This is not a complete list of what happened last week. Despite the fact that most of these and other events had a rather negative impact for the economy, this already habitually did not prevent the stock markets from growing. Millions of “noise” traders supplied by platforms like Robinhood are doing their job and continue to blow bubbles. Powell in his testimony before Congress did not say anything fundamentally new and only tried to cool the hottest heads, recalling that you should not count on a quick economic recovery. Even the “witching day” did not help on Friday afternoon - the massive expiration of futures and options contracts on the US stock market could not stop the current frenzy. Despite the fact that we are once again going against the will of the market, we continue to recommend sales in the US stock market and will open short positions on major US stock indices this week. Moreover, the situation with the pandemic is not something that has not improved during last week, but rather worsened and quite strongly. The outbreak of disease in Beijing, in which for a couple of months they forgot about the coronavirus and now about 150 new cases in literally 1-2 days. Germany's R number rockets again - from 1.79 to 2.88. US has 30K new cases per day again. So the fear of the second wave has acquired a completely material form. Main European currencies had problems last week. The pound was under the pressure from weak statistics and the lack of progress in negotiations with the EU, and even the Bank of England, with its additional 100 billion pounds to expand its quantitative easing program, could not reverse the negative market sentiment. As for the euro, the ECB's record injection of money (the largest refinancing operation in 22 years of the ECB's existence), in which 724 banks received 1.308 trillion euro loans from the regulator, provoked downward pressure on the euro. The negative for the euro intensified on Friday on news that the EU countries did not agree on a program of assistance of 750 billion euros to the economies of the countries affected by the coronavirus.
DJ:DJIShort
by Trade24Fx
Witching day, Bank of England and jobless claimsThe main event of yesterday was the announcement of the Bank of England decision on monetary policy parameters. Rates as expected remain unchanged - the Central Bank is not ready yet for negative rates. No less than expected, Bank of England expanded the quantitative easing program, increasing it by 100 billion pounds to 745 billion. These moves were expected by the markets, and the pound decided to work out the negative that has accumulated recently and has been actively declining. Accordingly, we see no reason to revise our “sell” recommendation for the pound. What else is worth selling, in our opinion, is the Australian dollar. Yesterday's data on the Australian labor market did not come out very well. Unemployment is at its highest level in almost two decades, and the reduction in employment turned out to be greater than experts expected. Today is interesting day first because it is one of the four so-called witching days of the year. The third Friday of the third month is the expiration of all major derivatives in the US market. This day is called "witching day". This event is fraught with illogical and sharp movements in the US stock market, as players randomly close their positions, as a result trading volumes and volatility can increase significantly. According to BMO Capital, since 1990 in such weeks the S&P 500 has lost an average of 3.1%. So, the day is ideally suited for the start of sales on the US stock market that we have been expecting for quite some time. Moreover, the reasons for this have long accumulated a critical mass: starting from an unprecedented economic crisis in the country, which resulted in a wave of bankruptcies of large companies, ending with a pandemic and mass protests in the United States. Yesterday's data on jobless claims is a confirmation of this: an increase of 1.5 million new applications, which is higher than forecasts, and the number of actually receiving unemployment benefits remains above 20 million.
FOREXCOM:NAS100Short
by Trade24Fx
2
Pandemic, Bank of England, Indian Issues and the EU MeetingThe pandemic situation continues to deteriorate. The number of new cases in the world is keep on growing. Significant share of this “success” belongs to Brazil, which breaks new records, bringing the daily number of cases to 35,000. Concerns are also giving China, where a new outbreak of the pandemic has been recorded. So far, there are hundreds, not thousands of cases, but all this does not look very good, especially in light of the main fear of the markets - the second wave. Situation in India is stably bad (10K-11K per day). A pandemic is far from the only problem of the country. The sluggish conflict with China over the “neutral” border territories is growing from hand-to-hand fighting and throwing stones into full-fledged armed clashes with dozens of dead. We will multiply this by problems in the economy and get a recommendation to “sell” for both the Indian rupee and the Indian stock market. Yesterday a lot of inflation data was published. And in general, they are rather bleak: the current economic crisis is not only a decline in production, but also deflation. And this is very bad, since it entails a full-fledged economic depression. Today it is worth paying attention to the statistics on jobless claims in the USA (analysts expect that the number of new unemployed in the USA will replenish with another million). But the main event of the day is the meeting of the Bank of England. The markets do not expect the Central Bank to move interest rates into the negative zone, but expect the expansion of the quantitative easing program from £ 645 B to £ 745 B. If this happens, the pound will receive the first positive news in the last couple of weeks. Otherwise, the disappointment will be so great that the pound selloffs will be inevitable. On Thursday-Friday there will be an EU summit. The fate of the proposal to create an aid fund of 750 billion euros will be decided. If the majority can convince a minority (Austria, the Netherlands, Denmark and Sweden), then the euro will receive an excellent opportunity for growth.
Long
by Trade24Fx
US Retail Sales, Powell and overpriced market The main event of yesterday was Powell's testimony in Congress. More precisely, the first day of testimony. Markets expected his comments for the Fed’s economic outlook issued last week following a FOMC meeting. Powell did not disappoint, saying that a full recovery of the US economy is possible only when the coronavirus is fully taken under control. Against the backdrop of fears of the second wave and the current pandemic peak, which is still not be formed, this is practically a recognition of the fact that economic recovery will be a very long process. In this light, we recall our recommendation “sell” in the overheated US stock market. According to recent survey from Bank of America, about 80% of professional investors consider the US stock market overvalued. By the way, this is a record value since the beginning of the publication of such surveys. In fairness, we note that yesterday there were reasons for the growth of optimism in the US stock market. We are talking about retail sales in the United States, which showed the maximum monthly increase in the entire history of observations. However, this is a chain indicator, therefore this record is actually the merit of the low base of comparison, which was formed as a result of a record drop in retail sales in April. So, it's too early to relax. This is also supported by data on industrial production in the USA: grew by 1.4% in May which is twice as low as the average forecast of analysts. That is, there is no explosive growth after the lockdown in the economy yet. UK labor market data was also released yesterday. The data came out mixed, but the growth in the number of claimant counts, which was almost 2 times higher than the expectations of the markets. In our opinion, this inclines the weight against the British pound. So, our recommendation to sell the pound remains relevant.
FOREXCOM:NAS100Short
by Trade24Fx