Masks, FED and Charts
Most the focus in the media, from analysts and pundits is on the developing Coronavirus situation in China and the rest of the world. Our thoughts go out to those who have been touched by the disease. The challenge for the market is what kind of affect will this have on growth expectations and in turn on investment returns ranging from which sectors will get hit the hardest, bouts of risk on and risk off in addition to traders have to decide what to focus on.
In Singapore as well as Stockholm, masks are sold out. Probably an issue in other areas as well.
Hong Kong has started closing some of the border crossings with China and we think there will be more to come.
WHO, says China has things under control, look for more delays to school and travel in China.
Tomorrow the Fed in the U.S. will hold a press conference after their two day meeting. The market will be interested to see if the events in China and the Middle East will factor in their conclusion. We may well see a more dovish Fed which will give some support to equities and other risk assets while hurting the USD.
We would expect gold to benefit should the Fed signal a possible cut in the months to come.
In addition to the Fed tomorrow, we have several economic releases that will come out today and tomorrow.
13:30 U.S. durable goods orders
15:00 U.S. Consumer confidence
15:00 Richmond Fed Manufacturing
Apple results after the close
On Thursday and Friday we will get:
Australia Q4 GDP
US GDP Q4 estimate
China Jan PMI, Euro Zone Q4 GDP, Canada GDP, US Dec PCE inflation
The above will give us a sense of the status of the economy as it was at the end of 2019.
The charts we are watching:
Many of the global equity indexes were testing key support yesterday. The DAX Index having broken the 13,300 level needs to hold above the 13,000 trendline support or risk a test lower.
|Ticker||Date Opened||Entry Price||Stop||Target Price||Current Price||% Change|
|Long EURCHF Put Option, Strike 1.0650, Expiry 15.4.2020||2020/01/15||1.0757 (0.00620)||1.06905 (0.00622)||+0.32%|
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