A storm continues in the markets. Opening week on oil and stock indices was fatal for many investors. The fear index is at minimal levels and now I look positively at the purchase of shares, due to the sale of bonds that I have been buying for a long time.
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In the near future I recommend to avoid positions inoil and in stocks / bonds of emerging markets, and pay attention to US technology stocks. The Fed has already greatly increased its balance sheet and is pouring enormous liquidity into the market. At the same time, it is expected that the rate will be further reduced at the next meeting. One way or another, American stocks will be pulled from the abyss in an election year.
Of the important events of the week, it is worth highlightingECB meeting on Thursday. It is very likely that a powerful stimulation of the markets will be announced, which may drop the euro after such a strong strengthening amid the Fed rate cuts.
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Bitcoin Volumetric terminal http://prntscr.com/re58uz
After a strong sale, the price is closeapproached the zone of concentration of liquidity below 7520. It is worth paying attention to the volume auction in yesterday 7910 - 7740, which may indicate a local culmination of sales. As a result, we can see correctional growth in the region of 8300, after which sellers will again try to push the price lower. A kind will be an attempt to trap buyers. It is important to consider that the key zone of resistance to liquidity of sellers is located in 8720 - 9100 and a breakdown of this particular level up will indicate a medium-term uptrend.
Oil. Volumetric terminal http://prntscr.com/re597o
Oil was adjusted early last week,but on Friday quotes were simply leaked on the OPEC foundation. The oil discovery on Monday killed many buyers. A similar drop has not been observed since the 90s, but the market is a market and you need to expect anything! After massive margin calls and dumping unnecessary passengers, we have all chances to partially correct. After such force majeure events, volume levels cannot be built. Therefore, it is worth focusing on the 30.00 mark for wti, where the market began to massively increase optional liquidity. There is no reason to wait for the full closure of the gap at 41.51 - for this we need to see a fundamental positive. But an attempt to correct to 36.00-37.00 in the near future can be expected.
Gold. Volumetric terminal http://prntscr.com/re5a45
Gold is expected to grow as predicted. In the deflationary phase of the market, gold will be in demand, therefore it is better to work from purchases. But it’s worthwhile to understand that now, after breaking the previous high and the 1700 mark, we can get a local correction. A good support level is in the area of 1639. In case of breakdown of this mark and a return of the price above, I plan to buy. If there is no demand for 1639, I will catch the price for the purchase in the region of 1600.
UST10. Volumetric terminal http://prntscr.com/re5b3e
Bonds, as expected, held a dob ascendingdynamics and now the correction time. Demand for bonds will remain, therefore, the current correction can be used to search for medium-term purchase opportunities. The most important levels for work are volume support 136.16, and also a key volume zone 135.7 - 134.10. At the same time, the zone of climax and imbalance in sellers' liquidity is 139.17 - 138.27.
S & P500. Volumetric terminal http://prntscr.com/re5bfl
Last week’s forecast worked out very accurately andSPX corrected by 50% in the zone 3125 - 3063, where it was recorded profit on long positions. After reaching this zone, the price began to merge again and updated low 2853, shaving off all the extra passengers. Indexes of fear are simply terrified, which is very good for us to buy. I expect the stock price to grow and we will see another test of the price zone in the region of 3100. A very good sign is a correction on bonds and gold, against the background of stock growth. By the way, it is very important to pay attention to the fact that the last low made its way through the declining volumes, and the purchase of prices followed on a huge ask delta. This is a clear sign of customer activity amid the end of the sale.
EURUSD Volumetric terminal http://prntscr.com/re5cyj
As previously indicated - the euro pulsed up byamid falling Fed rates, as well as expectations for further reductions. A very interesting correlation was observed between the euro, franc, yen and bonds. This is mainly due to low rates, which makes it possible to carry carry out profitably. The current correction on the bonds and the yen indicates the correction potential on the euro and the franc. It is likely that the market will try to test a key area of liquidity concentration of 1.1197 - 1.1120. Also pay attention to local volume support 1.1315. Do not forget that on Thursday the ECB meeting and the euro will depend more on the outcome of the press conference and rate. If the ECB greatly accelerates the printing press and reduces the rate in the negative zone, the euro will fly off to the floor. The market will simply have a huge desire to sell at current very high prices.
GBPUSD. Volumetric terminal http://prntscr.com/re5j9h
Pound Strengthens Amid Strong DropUS dollar value. If you dig deeper, then there are no reasons for positive for the pound itself. Britain's economy is highly dependent on transit and the banking sector. Declining business activity and falling commodity prices are very negative for England. I will explain. Recently, energy companies have been increasing capex due to bank loans and high-yield bonds. Current oil prices will contribute to the systemic defaults of these companies, as they simply will not be able to service their debt with the current business margin. As a result, the banking sector is forced to increase reserve standards and solve default problems. This will hit banks' margins heavily.
Now closer to the pound futures. Please note that sellers are already buying the price around 1.3200, which happened yesterday. As a result, a volumetric supply level of 1.3144 - 1.3097 was formed. Immediate support 1.3027 - 1.2997 and its breakdown will mark the end of the uptrend.
Another important point. Pay attention to the delta of yesterday - the net imbalance of the ask. This suggests that they carried out the feet of sellers and planted buyers. It is unlikely that they will be released. And all this happened amid falling open interest. Conclusion - large market participants handed out their longs to retail.
As for commodity currencies (AUD, NZD, CAD, RUB, etc.), they remain under strong pressure and should be considered only on short.