Daily Analysis - 19/04/2018
Stock markets around the world as well as some commodities are marching upwards as new buying is coming back into the markets. This is another positive sign that the fear of the last two months is receding. We are positioning to take advantage of this return by taking buying indices up for short term periods of time or in price terms, small gains. In other words, we keep our take profit orders and our stop loss orders closer to the opening price than we would if we thought that the trends were stronger than we do. Yes money is coming back in, but it is not a bullish stampede. The new investors are more cautious than the rest of the market crowd.
The Milan index has been the standard bearer for Euroland for the past week’s rally. We like it because it is rising robustly and steadily. Keep your eyes on worthwhile trades as they are not likely to last but for several hours and maximum, end of day. The stock market are not yet populated with the loose hands who were shaken out recently.
This market is oversupplied, yet rising. It is a tricky fundamental situation because of the OPEC stranglehold on supply. The cartel has its weaknesses but they are not in evidence today. The price of crude has not responded as it normally would to recent inventory reports with large oversupply numbers barely affecting the price and small depletions moving price excessively often in the opposite direction.
The Swiss Franc continues its slide. We are trading the EURCHF though other CHF pairs are tracking a similar path. Why the Franc is weakening has been the subject of debate among commentators but we have heard no convincing reasoning. Traders have been exiting and selling the CHF short for weeks now. We have been taking advantage of the movement for weeks.
