The long-awaited bounce!

By 29/01/2020News
Morning Stock News

Gold   1566,37
(-0,05%)

EURUSD   1,1015
( -0,05%)

DJIA   28780,50
(-0,29%)

OIL.WTI  54,09
(+0,22%)

DAX   13321,59
(+ 0,01%)

After two days of “big blood” in the stock markets, the bears took a break today. The S&P 500 index is confidently closing the day on the plus side. However, many risky assets, such as oil, Australian and New Zealand dollars, almost did not respond to the positive. This once again confirms that the American stock market is increasingly living its own life.


Chart of the day S&P500


Nothing in the world has changed fundamentally in a day, the number of coronovirus patients in China continues to grow. The main question that everyone is concerned about is why the number of confirmed cases in other countries is still very low. If the answer lies in the long duration of the incubation period, a new wave of chaos may await us in the coming days.

SWISS FRANC

Frank never ceases to amaze. During the first half of January, we noted that it is growing as stock markets are growing. That is, it does the exact opposite of what a protective asset should do.
However, the situation has changed with the arrival of the coronovirus. Ideally, the franc should continue to grow, and it begins to decline against the U.S. dollar. What’s the catch?
There’s probably no catch. On the one hand, just terrible trade balance data came out today, much worse than predicted. They show that the patience of the Swiss central bank against the strengthening of the franc is not forever.
On the other hand, investors are increasingly pessimistic about the outlook for 2020, against the backdrop of a new epidemic. So this year, many of them are likely to spend “in the money”. Against this background, it is certainly better to buy U.S. dollars and receive income on U.S. bonds than to pay a negative interest rate from your pocket for owning the franc. In the next couple of weeks it will be clear whether this version has the right to exist.

BITCOIN

In the previous newsletter we paid attention to the first crypt currency starting a new growth cycle, and already today we have new highs of the year. In theory, there are no obstacles for further growth of gold and Bitcoin (new digital gold). The main battle of bulls and bears will go beyond the level of 10.000$, which we should see in the 1st-2nd quarter of this year.

What’s waiting for us today?

01.30 Q4 Consumer Price Index in Australia
20.00 US Federal Reserve Interest Rate Decision
20.30 Press conference of the US Federal Open Market Committee


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