Hi Everybody,
One of the coolest things about working in the Fintech industry is getting the inside scoop on new technology. Recently eToro hosted a lecture for employees and a few guests on how the blockchain works, the potential of Ethereum, and new digital currencies that are coming on the market.
For your convenience, I was able to capture the lecture on video. We have no current plans to promote this video. However, as valued clients, partners, employees, and as loyal readers of the daily market update, I feel that the knowledge within is worth sharing with you.
Hope you enjoy!
Mati
Today’s Highlights
- Gold Surging on Safety
- Tillerson in Moscow
- Trump on Himself
Please note: All data, figures & graphs are valid as of April 12th. All trading carries risk. Only risk capital you’re prepared to lose.
Market Overview
Though many market analysts and commentators may be afraid to say it, the markets are showing very clear signs of FEAR.
Sign 1… Gold surging past $1270. Now at levels not seen since the US election results came out on November 9th.
Sign 2… Yen surging. This is the purest safe haven currency. It has now broken below 110 Yens to the Dollar, a significant level we’ll explore below.
Sign 3… The VIX popped up yesterday. The fear index is now reading 15.07, also the highest level since the US elections.
Sign 4… Stocks falling. Almost all major global indices are red. The DAX in Germany fell more than 1% yesterday before making a weak recovery to close at a loss of 0.5%. The Nikkei 225 is down more than 1% so far today.
That should be enough to confirm the above statement but I’ve got one more for you…
The price of Oil is rising. Since the Trump attack on Syria, we’re noticing a slow but steady gain in the price of Oil. Now, this may have to do with expectations of lower output in the future but current stockpiles have not waned. Since the source of the fear is the Middle East, escalating tensions give oil traders a good incentive to be on the buy side.
Carlos Moreno Vals AKA @TradeBetter commented on Trump’s recent actions in a note that seems to encapsulate how investors on eToro feel at this point in time.
Chart for Yen
As promised, here’s the chart…
The Blue line is the 110 level. Now there is no real support left until around 105.
This is not a great sign for clients in eToro who have been long on the USDJPY pair for the past few weeks. At the moment, Stop Losses are getting eerily close. With the average stop loss for buy positions as close as 108.90, just 65 pips away from the current price.
Focus now on Russia
The United States has made their move in Syria. Now it’s Russia’s turn to respond.
Today, Trump’s Secretary of State Rex Tillerson is visiting Moscow and the number one question is who will he be meeting?
Traditionally, a new US Secretary of State visiting Russia should meet with the head of state. However, there has been a lot of speculation in the media as to whether Putin is willing to meet with Tillerson. If he declines, this could represent a turn not only on Syria but could be an end to the Trump-Putin bromance.
In fact, Putin has already put out a statement comparing the US allegations that Assad was responsible for the chemical attack to the time that US intelligence claimed that Sadam Hussein possessed weapons of mass destruction.
At the moment, the Ruble is in a position of strength as analysts were expecting sanctions to be eased by the Trump administration. However, if we see a quick policy turn around here the pair is likely to get very volatile in the coming days.
In the meantime, the White House is taking it on the chin in social media over comments from WH Press Secretary Sean Spicer, who said that “even Hitler didn’t use chemical weapons.” The entire world said, wait… what?
He was, of course, quick to apologize for the statement but it’s a bad day for any public figure when you’re drawing criticism from the Anne Frank Center.
What’s next?
More Trump of course. The Donald will appear on his favorite news station, Fox Business. For some strange reason, the interview is going to be at 6 AM EST. So most Americans will be asleep when it happens.
Trade with others. Join eToro community and use experience of other traders!
Trump, of course, will be talking about his favorite subject… himself. Expect to hear comments on everything from Healthcare to tax reform, to the situations in the Middle East and North Korea. This oughta be fun.
Thanks again for all the amazing feedback on these updates. It’s really appreciated.
Have an amazing day ahead!
Best regards,
Mati Greenspan
Senior Market Analyst
