Weekly Market Outlook

Let us have a quick look at the week ahead, which is not rich in economic data. Tomorrow the UK is reporting the final version of the GDP for the last quarter of 2019. The US and major European economies, Germany, France and the UK, are releasing key manufacturing data on Wednesday. By far the most important figure is the US non-farm payrolls. Watch out carefully for it on Friday and adjust your trading, because it promises to cause violent swings. Last but not least, the COVID-19 developments promise to remain the main driver of financial markets around the globe.

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Weekly Market Outlook

All Week: Coronavirus

The coronavirus-induced volatility on financial markets showed no signs of abating last week. Central banks across the globe took out their heavy ammunition, resorting to multiple rate cuts, large liquidity injections and other unconventional policy measures. Monetary stimulus alone, however, is not enough to support markets. People are now keenly awaiting to see if policymakers hold onto the promised fiscal commitments to support the economies of their respective countries. Any signs of backtracking would surely result in further steep declines on financial markets. Volatility is likely to remain pretty high, as investors see the coronavirus taking its toll across the Old continent, the UK and the US. 

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Weekly Market Outlook

While reading this article, you should bear in mind that the top story to look out for this week is the unfolding of the dynamic situation surrounding the coronavirus. What you need to be looking at is not just the pace at which the virus is spreading, but also the institutional response, both on a country and on a global level. The markets will be scrutinizing the measures taken by leading countries to judge how long the pandemia could be menacing the world and what the potential impact on the global economy could be.

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Crude Oil in a Free Fall

Yesterday, 9 March 2020, is a day most crude oil traders will remember for a lifetime. After brutally gapping almost 20% lower compared to the previous week close of $41.56, US West Texas Intermediate (WTI) futures continued their early morning slide on Monday to touch $27.35, the lowest price since 12 February 2016. Similar was the case on the Brent oil market, where futures were down more than 30% in the early morning to touch $31.03, again the lowest since 12 February 2016.

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Make Your Trading Corona Proof

With 96,218 confirmed cases and 3,303 deaths so far, according to Worldometer statistics, the coronavirus has been taking a heavy toll on humankind. Projections that the disease has much more to spread would better make people around the world much more cautious. If there is a single most important quality on which individuals should focus in the face of this imminent biohazard, this is definitely adaptation, in all possible forms.

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Financial Markets Under Pressure

Financial markets are in crisis mode for a third day in a row as the coronavirus spreads.

So far this trading week has been extremely difficult for the main US financial index: after negative 3.56% on Monday, a decline of 3.15% followed on Tuesday. Since closing last Friday, the Dow Jones Industrial Average (DJI) has lost almost 2,000 points. And so far there are no signs of when this sell-off might end.

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Trading Idea – USDCHF

Current Trend: Just turned from bearish to bullish

Relevant Key Levels: Resistance at 1.0828 and 1.1059. Support at 0.9612 and 1.0240.

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The DAX30 at All-Time High

The record run of the DAX continues: the leading German index marks a new all-time high at 13,739 points. The old record from the end of January is history again. The strong US stock exchanges play a major role in this rally as well.

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Is Tesla the New Rocket Ship from Musk?

Since the start of the year, the price has more than doubled. You can credit much of the increase to the seemingly boundless enthusiasm of Tesla’s supporters. But the haters appear to be playing a role, too. After betting that the company would fail, many seem to be cutting their losses and that is actually pushing the share price even higher.

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Analysts Look Forward to Facebook’s Results Today

Facebook (Nasdaq:FB) will report fourth-quarter 2019 results on Wednesday, January 29, after market close. The company is expected to have generated $28.9 billion in revenue and post $2.52 of earnings per share. Facebook stock recovered during 2019 after a weak 2018 for the company due to regulatory investigations and multiple data leakage issues. Although Facebook’s problems are far from over and CEO Mark Zuckerberg warned about the difficult upcoming year, the company continues to be stable in its revenue flow. Facebook announced that new users are still added to their apps and that as many as 2.8 billion people already use at least one of their services on a monthly basis.

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