European stocks drifted lower at the opening on Monday, extending losses registered earlier this morning by Asian benchmarks, as the appetite for risk assets decreases. This risk-off mood, initially triggered last Thursday by fears of a second virus wave, has been confirmed over the weekend after a rise in the number of new COVID-19 cases were spotted in many different areas such as Japan, Beijing and the US (20 states). In addition, macro data added to this global disappointment this morning after Chinese retail sales continued to drop and the industrial production came in below expectation. Even if higher volatility may come from multiple monetary policy meetings this week (BoE, BoJ and Swiss National Bank), the risk-off tone will prevail as more and more investors view the economic recovery to be longer than previously expected. Meanwhile bonds, precious metals and other safer havens are likely to be used as diversification tools this week as traders try to hedge their portfolio against these rising downside risks on stocks.
Technically speaking, the Stoxx-50 Index is now trading inside the lower part of its bullish canal, slightly above the strong 2,850-3,050pts support zone, which is the last remaining support before the bullish trend would become invalidated.
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.