A strong correction instead of a Christmas rally

By 04/12/2019News
Morning Stock News

Gold   1480,63
(+0,23%)

EURUSD   1,1077
(-0,04%)

DJIA   27501,50
(+0,07%)

OIL.WTI  56,53
(+0,43%)

DAX   13054,27
(+ 0,01%)

Trump’s trade wars are getting more serious, influencing global economic growth. The relationship between the US and China remains tense after Trump stated that it will take another year to solve the issues. Moreover, the President’s threats regarding French goods are scaring European investors and stirring trouble between the US and the EU.

EUR/USD day chart

EURUSD day chart

For Bitcoin, the end of 2019 is nothing like what the analysts predicted. Even though the price has grown by almost 90% relative to the same period last year, market players wish to believe that the price can go higher after the halving. On Tuesday, Bitcoin hardly moved at all, trading at $7370.

EUR/USD

The dollar suffered once again as a result of the US leaders’ harsh statements. EUR/USD is looking good, having reached the important resistance line of 1.11 in just two days. Euro could continue its growth – as long as the Fed doesn’t act on Trump’s hints that the interest rate could be lowered even further.

GOLD

While confusion reigns in the capital markets, gold investors are feeling more energetic. On Wednesday, gold was traded at $1478 per ounce and tried to break through the top limit of the $1445-$1449 range. The investors are tired of waiting for a US-China trade deal. It’s also clear to them that new tariffs on French goods and metal imports from Argentina and Brazil mean new risks.

INDICES

Global indices kept going down on Tuesday after the US Secretary of Commerce said that unless there’s a breakthrough in the talks, new tariffs on Chinese goods will be introduced on December 15. The fall in the US markets accelerated, with S&P500 losing over 1% and Dow Jones more than 1.3%. The results of the day were mixed among European indices. It’s likely that on Wednesday European markets will keep reacting to the news from the US and fall further.

What’s next?

01.30 Australia: GDP data since the beginning of 2019
10.30 UK: purchasing managers’ index (PMI)
14.15 US: ADP nonfarm employment change for November
16.00 Canada: decision on the interest rate
16.30 US: stocks of crude oil


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