On Thursday, the stock markets underwent a powerful correction. Investors take profit and leave the stocks. What happens in the forex market in this case? Everyone goes into protective assets. There are only three of them: the US dollar, the Japanese yen and the Swiss franc.
In this case, the Japanese yen and the Swiss franc have grown. They included money from investors who sold their shares. And the American dollar went down again. The chart above is very instructive. Before that, the euro rose against the dollar for 4 consecutive days. Thursday was a great opportunity for turning around to punish the buyers of European currency.
Instead, the dollar fell heavily against the euro again, showing a green candle on the chart for 5 consecutive days. You know what the most interesting thing is? It was after the breakthrough of the level 1.16 that the first conversations started, that the next target is 1.20. If the conversations just started, it indicates that the trend is in its middle. Theoretically, it can hold a lot of new money flowing into the EURO.
And when asked, why is this happening? We recommend you to reread our previous few mailings. The main thing is what we should start thinking about. The trend may last until the presidential election in the United States.
From the highs shown on Thursday, the gold metal is only about $ 20 left to the epic level of autumn 2011. Some may think that the price of $1,920 per troy ounce will be the ultimate goal of speculators. However, this is not the case. Yes, a 2-4% rollback may occur at any moment. This will be a new opportunity for buyers to enter the position on a rollback. Who will take advantage of this situation? The biggest investors who believe in the dollar less and less.
Oil did not follow a number of risky assets and declined by the close of trading on Thursday. In this case, the fall of stock markets became an excellent signal for profit taking. The main question remains. If the S&P 500 index continues to grow again tomorrow, will black gold follow it?
Ahead of us there will be autumn and complete collapse of the tourist industry. It is clear that this year the volume of air traffic will not be able to return even to the levels of 20 years ago. The demand for oil will not recover. On the other hand, American oil shale companies can take advantage of the situation.
Of course, it is silly to reopen closed wells in the calculation that oil will cost $40. But shale oil companies can make you smarter. Sell oil supply futures at this price a couple of years in advance. And then, of course, defrost the wells. As a result, already in 1-2 months we can see the growth of oil production in the USA and Canada again. And it will be a moment of full cap for the oil sector.
What’s waiting for us today?
08:00 UK retail sales for June
09:30 German Manufacturing Index July
10:00 EU Manufacturing Index for July
10:30 UK Service Business Index July
16:00 U.S. New home sales for June
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