European stocks opened on a mixed tone on Tuesday as rising concerns and uncertainty globally put pressure on prices. Investors who chose to take profits following the rally since the 23rd of March may be tempted to keep on doing so after new virus cases were recorded in South Korea and Wuhan, highlighting fears of a new wave. We are now in a crucial phase where investors, after the recent mixed data and corporate results, desperately need more clarity on the short to mid-term outlook. Even though most market operators believe the virus peak is now behind us, they still need more evidence that economies are back on track and that the pathogenic agent is firmly contained before increasing their exposure to risk assets. Additionally, market sentiment is being shaken by rising US-China tensions, especially after President Trump declined a request from Chinese officials to renegotiate the Phase One trade deal. Traders now have to deal with two different bearish leverages on stocks: the 2020 as well as a resurgence of 2019’s trade tensions between Washington and Beijing, which is making for a very difficult trading environment ahead of the summer season.
The DAX-30 Index is one of the eurozone’s worst performers with the price dancing near its open price level. Technically, the market has failed to clear the 10,980-11,120pts zone previously mentioned and slipped back to their double support (trendline + 55-day moving average). Even if a pull-back towards 11,000pts remains possible, a breakout down below the support level at 10,770pts is now the most likely scenario on a short-term basis. If that support fails then the subsequent ones are at around 10,545pts and 10,200pts.
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.