European shares drifted lower on Thursday alongside Asian equities and US Futures on the S&P 500 as market sentiment slowly fades. Investors, who were already sceptical about further gains on stocks, have seen their risk appetite slashed by yesterday’s comments from Jerome Powell. The Fed chairman added to the current uncertainty by warning investors about the lasting damage to the economy caused by the coronavirus pandemic, and the fallout could worsen if no additional stimulus support is provided. The market optimism between the end of March and early May has now vanished and led markets to fresh lows for the first time since the beginning of the April rally. This is seen as a threatening situation to markets as the short to mid-term bullish trend is now over and traders wonder if prices will enter a horizontal consolidation phase or start a new corrective move that could lead to much lower lows.
Investors will need fresh bullish leverages, like reassuring macro data or encouraging numbers on the virus front to send prices higher and restart the rally. Having said that, we expect volatility to rise towards the end of the week as investors cautiously monitor the latest significant data with today’s US jobless claims and tomorrow’s much anticipated retail sales and industrial production from China.
While a student, Pierre Veyret had a passion for the financial markets. At the time, he studied International Trade through the setting up of import / export operations and it was the techniques of hedging against exchange rate risks that helped him to make the link with the financial markets, and all especially that of Forex. It is therefore with the aim of anticipating the price of currencies several months in advance that Pierre quickly turned to different methods of analysis by drawing inspiration and surrounding himself with experts in the field. Shortly after, Pierre decided to specialize in Technical Analysis, a discipline he had the opportunity to practice with real market professionals, thanks to AFATE / IFTA, an association of which he has been an active member for several years. Pierre Veyret is passionate about the field of the financial industry with a particular interest in the various techniques of stock market forecasting. Currently, Pierre is based in the City of London where he works as Chief Analyst. He performs regular interventions on a multitude of asset classes through various media (television, internet and print media).
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© 2019 High Leverage FX - All Rights Reserved.