Gold 1944,31
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EURUSD 1,1836
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DJIA 27483,50
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OIL.WTI 42,69
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DAX 12933,46
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Just yesterday in our newsletter we discussed the fight for the most important round level 1.20 in the pair EUR/USD. Today, such a fight took place in real time in the pair USD/CHF. The bears got the strongest fight. And in fear they fled.
USD/CHF
For 5.5 years dollar/franc pair could not break the level of 0.90. On Tuesday, the price almost came to it. On Wednesday, there was a fight. The bears wanted to break through this level and remove a huge number of stops accumulated over the years. The bulls decided to stand dead so they wouldn’t lose money.
Of course, a lot of speculators got into the game. They bought next to the level 0.90 and put the stops right behind it. The calculation was simple. If the level is broken through, you get a small loss. And if the level resists, then you can quickly get a good profit. Or you can stay in the pair for a long time at all.
What did you get in the end? The bulls won. The dollar/franc pair turned around and went up sharply by 1.5 points. The speculators got a huge and fast profit, several times higher than the risk level.
What should we wait for next? Now we have 2 options for the situation development. Either a hike to 0.93-95 (even if it takes some time). Or retest level 0.90. As practice shows, if the bears can sell the price again to 0.90, most likely this level will not resist. And we are waiting for a very strong downward movement.
S&P 500
The American S&P 500 index has finally updated its historical highs. But the situation with his partner, the Dow Jones 30 index, is interesting. He’s still 5-6% lower. Why is that? The fact is that the index, which includes 30 American blue chips, includes only 2 technology companies: Apple and Microsoft, which lead the market up.
By the way, it’s a remarkable fact. Apple’s capitalization has reached $2 trillion for the first time in history. Which company would be worth $5-10 trillion? We think it’s definitely not going to be Apple. One of our future mailings will tell you our opinion on the matter.
What’s waiting for us today?
08.30 Industrial production in Switzerland for Q2
14.30 Initial weekly unemployment benefit claims
14.30 Philadelphia Manufacturing Index for the US Federal Reserve in August
Important Notes on This Publication:
The content of this publication is for general information purposes only. In this context, it is neither an individual investment recommendation or advice nor an offer to purchase or sell securities or other financial products. The content in question and all the information contained therein do not in any way replace individual investor- or investment-oriented advice. No reliable forecast or indication for the future is possible with respect to any presentation or information on the present or past performance of the relevant underlying assets. All information and data presented in this publication are based on reliable sources. However, Bernstein Bank does not guarantee that the information and data contained in this publication is up-to-date, correct and complete. Securities traded on the financial markets are subject to price fluctuations. A contract for difference (CFD) is also a financial instrument with leverage effect. Against this backdrop, CFD trading involves a high risk up to the point of total loss and may not be suitable for all investors. Therefore, make sure that you have fully understood all the correlating risks. If necessary, ask for independent advice.