Unemployment Thursday (Yes Today!)

As I survey the markets:

Equity markets are supported by:

Positive vaccine news

Strong ISM manufacturing index in the U.S., and some other positive economic reports.

Committed Central Banks and Governments

Lack of alternatives

The same markets are not bothered by:

Worsening Covid-19 developments globally, especially in the U.S., over 50,000 new cases yesterday in the U.S. alone

Tokyo reports highest number of virus cases in two months

New sanctions most likely on China

Fed informing that it will take a long time before the U.S. economy returns to normal

Fed’s Bullard says that the U.S. is still in the middle of a crisis

Hong Kong makes national security arrests.

It will be interesting to see if in the coming months, that Europe with its more aggressive lockdown policy sees better relative growth as it opens up, compared to the U.S. which appears to be struggling from shutting down too slowly and reopening too quickly.

Since the middle of May, EU 50 has outperformed both the S&P and Nasdaq!  More of this to come?

Since May 15th the EURO is up 4.3% against the USD

Key themes for us:

The equity markets in the U.S. are difficult to buy (valuation, pandemic) but also difficult to short (vaccine, Central Banks)

Gold:  we still like buying dips, we expect a test higher on the back of low rates, exploding debt levels and flight to quality.

Brent Crude Oil:  Feels to us we are still in a $35 to $45 range, while market deciphers global growth prospects.

EURNOK: benefitting from risk on. Looks to be in a 10.50 to 11.00 range for the summer. Guided by risk on/risk off.

Gold mining stocks/ETFs:  We have written many times bout how we like these as part of a portfolio longer term.  Still the case.

Please note some interesting graphs from Saxo analysts:

https://www.home.saxo/-/media/content-hub/documents/2020/july/2020_07_02_marketcall_slides.pdf

Contact us if you are interested in receiving real time trading signals. In doubt? Check out our track record below!

TickerDate OpenedEntry PriceStopTarget PriceCurrent Price% Change
LONG Austevoll Seafood ASA (AUSS:xosl)2020/06/0276.7572.00SPREAD TRADE78.00+1.63%
SHORT Leroy Seafood Group ASA (LSG:xosl)2020/06/0256.75SPREAD TRADESPREAD TRADE57.20-0.79%

Visit our Position Tracker to look at all of our realized trades and proven track record! 
2018: 45 Trades, Hit Ratio 53,66%, Profit +35,87 %
2019:   31 Trades, Hit Ratio 45,16%, Profit +26,97%

– Mark W

Leave a Reply

two × three =