• Francois Abley

The general situation of the major financial markets

Dernière mise à jour : 17 déc. 2018

We are on December 17, 2018 and all financial market players have only one question in their minds that is: are we going to get a Christmas rally this end of the year? Or did we ever attend a Christmas rally during the Remontada of the financial markets following the speech of the boss of the FED (Jerome Powell) where the financial markets had practically progressed by 4% in a straight line after a decrease of about 7%. In any case, in view of the current posture of the financial markets, it would seem that the financial markets had certainly over-reacted in front of Jerome Powell's speech, when he announced a new era in his management of the monetary policy that is Neutral monetary policies for a short period of time to let the financial indices breathe and recover from the pressure of the last few weeks.

The other factor that is also alarming, and not least, is undoubtedly the commercial relationship between China and the U.S. that are switching to another field, that of the diplomatic, with the arrest of the CFO of the company HUAWEI (global giant of the Technology behind Apple and Samsung), Cathy Sabrina Weng Wenzhou, who was arrested in Vancouver (Canada) and then extradited by the Canadian authorities under the orders of the U.S. government. For a few days now, we have witnessed small diplomatic escapades between China, the U.S., and Canada. This tense climate between the two major economic powers puts pressure from a geopolitical point of view, on the major indices and in turn on the major commodities that are gold and oil, which therefore condition the supply and demand Global and global growth; Gold being the global refuge and oil the engine of global growth that would therefore require an affordable dollar value.

Looking therefore generally, in the major markets here, we see that the S&P500, the Oil, le DAX, and the EuroDollars, are all without exceptions on major levels; Either crucial supports or on important thresholds, polarity inversions (Support that becomes resistance or vice versa). It will therefore be a decisive week in these markets that condition and guide in some way the holding of other markets or assets. The S&P with the area of 2600-2550 points, the oil with the global threshold of $50 a barrel, the Dax at 10 800 points, and finally the EuroDollars at 1.12400. As a reminder, as long as these levels hold, and will be above these levels, there will be no question of evoke a Bear market. The signal of a Bear market will be activated at the break of the 2550 threshold; But already below the 2600 points on the S&P 500, this remains largely tense! We should therefore consider a possible rebound if we keep these levels evoked from these different markets!

Overall view on major markets
Weekly Market Analysis


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