Hacked: Hacking Finance

Analysis

Daily Analysis: Stocks in the Red as Geopolitical Tensions Mount

Posted on .

Daily Analysis: Stocks in the Red as Geopolitical Tensions Mount

Introduction

Tuesday Market Recap

Asset Current Value Daily Change
S&P 500 2350 -0.45%
DAX 12188 -0.25%
WTI Crude Oil 52.80 -0.53%
GOLD 1267.75 1.20%
Bitcoin 1215 1.16%
EUR/USD 1.0614 0.17%

 

Global stock markets are slightly lower today, as the major indices continue to trade in narrow ranges on the holiday-shortened week. Last week’s trends remained dominant so far as European and Asian stocks are still slightly weaker, while the major US benchmarks are somewhat stronger. The growing tensions regarding North Korea sparked some buying in gold and the Japanese Yen, as both China and the US have sent military forces in the region, while the communist country warned of a possible nuclear strike “against its enemies”. The Syrian situation is also on the edge, with today’s G7 meeting unlikely to deliver a breakthrough in

Currencies remained stable with moderate selling in the US Dollar following Janet Yellen’s speech, as the Yen and the British Pound inched higher. The Euro is also slightly higher, following the better than expected German ZEW sentiment indicator, but the common currency is still near its one-month lows. WTI crude oil reached the $53 per barrel level for the first time since early March, while gold surged above the $1260 resistance level again. On a negative note for precious metals, silver is still relatively weak compared to gold.

Gold, 4-Hour Chart Analysis

Bitcoin held up well above the $1200 level, but it failed to rise above the upper boundary of its resistance zone at $1215, as traders still await the cryptocurrency’s push towards its all-time high near $1300. Monero might also be heading for a thrust to new highs as it breached the $22 level overnight, although a major momentum move is yet to happen. Dash continues to drift lower, trading barely above last week’s support at $60. Ripple is still stable near the 0.035 level, while Ethereum and Litecoin are also trading sideways today.

 

Technical Picture

DAX, 1-Hour Chart Analysis

The DAX continued its orderly correction on the 1-hour chart, and the German Index that had been leading global markets in March is now nearing the end of a triangle consolidation pattern. The range contraction that dominates US markets is visible on this chart as well, as the 12150 and 12250 levels provide strong short-term support and resistance for the benchmark. The long-term uptrend is still intact with the lower boundary of the trend channel now close to the 12,000 level.

Key Economic Releases on Tuesday

Time, CET Country Release Actual Expected Previous
10:30 UK CPI Index 2.30% 2.20% 2.30%
11:00 GERMANY ZEW Economic Sentiment 19.5 13.2 12.8

 

Key Economic Releases on Wednesday

Time, CET Country Release Expected Previous
10:30 CHINA CPI (yearly) 1.1% 0.8%
11:00 UK Average Earnings 2.1% 2.2%
14:30 UK Unemployment Rate 4.70% 4,7%
14:30 CANADA Base Interest Rate 0.50% 0.50%
14:30 US Crude Oil Inventories -0.7 million 1.6 million
Important: Never invest money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.



Feedback or Requests?

DON'T MISS OUT

Mate Cser

Mate Cser

Trader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.

Comments
  • user

    AUTHOR Ershad

    Posted on 4:22 pm April 11, 2017.

    Hi mate,

    Following the geopolitical movements regarding both Syria and North Korea, what’s the best price you think gold will reach? Also at what price would you recommend selling ?

    Kind regards

    Ershad

    • user

      AUTHOR Mate Cser

      Posted on 5:01 pm April 11, 2017.

      Hi Ershad,

      the next “natural” resistance level to watch is $1315, from there I would certainly look for a deeper correction. That said, as an investment and as a hedge against political risk and a major negative move in stocks, I would definitely keep a core position in gold. The long-term picture is the most promising that it has been since the top in 2011, with the first higher low on the monthly chart, and clear relative strength, despite the Dollar’s strength. All in all, it looks like we have a new bull market in hand with gold. Thanks for the question, great trading!

  • View Comments (2) ...
    Navigation
    The irony of the diffusion of human advancement has created…