› Market review, Mar 12 – Mar 16, 2018

Market review, Mar 12 – Mar 16, 2018

Gold

The publication of data on unemployment on Friday, March 9, supported the value of gold; and on Monday, March 12 it showed the flutter movement fundamentally.
There is a high probability that this week investors will be interested in more risky assets, which will negatively affect the cost of the yellow metal. Moreover, the depletion of the international situation will also put pressure on gold.

From the technical analysis, gold is in a small downward channel, and the likelihood that this movement will continue in the upcoming week is high. If you consider a longer period, you should take into consideration the rhetoric of the new head of the Federal Reserve System, because the decision to raise the interest rate in the near future will put additional pressure on gold, and a long-term uptrend may change its direction.

Market review, Mar 12 –  Mar 16, 2018

Volkswagen

The last year was far from the best for the auto giant. Scandal in 2015 between the German manufacturer and the USA because of the software understatement of exhaust gas from their diesel cars (that is also called as falsification) during the testing period; and after the testing period the car went into a "regular" mode and the damage from gases exceeded the norms by 40 times. After that, the US Department of Justice opened criminal proceedings against the management of VW due to the fact that there was a fake test of cars for gas exhausts into the atmosphere. The EU responded that they will conduct an internal investigation regarding the concern and other automakers to comply with environmental standards. And at the beginning of this year, the problems have happened to the second auto giant - Daimler.

So, Volkswagen had to pay 4.3 billion dollars in the second half of 2017, the part of which, namely 2.5 billion, was paid in the 3rd quarter of last year. We are waiting for the report for the fourth quarter, in which there will also be deductions for the repayment of the diesel scandal. In total, the concern paid for this incident 25 billion euros and should soon be exhausted. Although free turnover is less than 10% of the shares, patient investors suffer from low incomes and reduced deductions of dividends for all 3 quarters of the past year.

Given the foregoing, we should expect a drop in the price for the release of reporting, there is also a high probability of a geb down followed by the restoration of the price. At the current price of 160.20, the nearest level is 158.4, the next is 157.00.
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Market review, Mar 12 –  Mar 16, 2018

OIL

After the disturbances on the last Wednesday, black gold has recovered slightly by the end of the last trading week and on Monday morning is traded within 61.40-62.20. Pressure on which, you can expect from Tuesday on the American side, the most volatile publications are traditionally for oil on Wednesday and Friday. Also this week, OPEC will try to coordinate the extraction with the States, because America becomes a full player in this market, but the fact that Trump will make concessions and cut production to maintain prices is very doubtful. Therefore, this week is uncertain price drop, at least until Wednesday, when the stocks in the States become known, then it is worth take it from there.

Market review, Mar 12 –  Mar 16, 2018

EUR/USD

As expected, the last week was not very surprising, although the expectations were very different. The ECB did not change its rhetoric about monetary policy for the near future, Trump retreated and excluded Canada and Mexico from the "black list of duties", while saying that he was ready for proposals from partner countries. Last Friday NFP supported the dollar well, returning it to the corridor 1,233-1,228, where consolidation is observed from Monday morning. This week is expected to be no less intense, as early as Tuesday, important news will be published. During the week there will be: Spain's inflation, ZEW's economic sentiments in Germany and the EU, the EU finance ministers' meeting, Draghi will speak on Wednesday, Prata at the meeting of the Eurogroup, which will also become aware of the volume of industrial production for January, and the meeting will be closed by Vitor Constancio

It is on Wednesday the EU will respond Trump regarding its duties - will there be any counter restrictions? And on Friday the European ends the week with inflation for February, which is predicted to remain unchanged, and also the level of wages for the fourth quarter will be published. States against the February inflation will begin on Tuesday and continue with weekly oil reserves from the American Petroleum Institute (API). On Wednesday there will be the monthly OPEC report, the basic retail sales index (which directly affects GDP), the producer price index, the retail sales volume for February and by evening traditionally crude oil reserves. Also, it is worth noting to say about the crisis in Italy, the growing level of unemployment, accompanied by rallies, which does not support a single currency. Therefore, we expect the weakening of the single currency by the end of the week to levels of 1,226-1,224.

Market review, Mar 12 –  Mar 16, 2018


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