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Dow Jones: Bearish divergence on RSI.DJI managed to recover the drop that (marginally) broke the 1D Channel Up resuming the bullish technical action (RSI = 64.012, MACD = 186.600, ADX = 46.489, Highs/Lows = 130.1071). The RSI on the 1D chart is on a bearish divergence though and the last two times that happened the index dropped -3.20% and 5.13%. If the current bearish divergence follows the same patterns then we are looking at two downside targets: 27,965 and 27,400. ** If you like our free content follow our profile (www.tradingview.com) to get more daily ideas. ** Comments and likes are greatly appreciated.
OANDA:US30USDShort
by InvestingScope
Another $20 trillion threat on the horizonIn previous reviews, we have repeatedly talked about the future global crisis. The economy is developing cyclically and sooner or later will have to pay for a period of growth and prosperity. 2019 clearly showed that the situation in the world economy is rapidly deteriorating and if nothing happens, then it is only a matter of time before the decline comes to replace economic growth. We have already said that trade wars, escalation of the conflict between the USA and Iran, presidential elections in the USA, all kinds of force majeure and flash crashes, the collapse of price bubbles in the stock market, corporate lending and real estate, derivatives market, defaults of Chinese corporations, lack of liquidity in financial markets, etc can accelerate existing negative trends and provoke a global crisis. Today we’ll talk about another problem, the price of which, according to various estimates, is up to $ 20 trillion. We are talking about the financial risks associated with climate change. Current events in Australia show that the scale of natural disasters is growing rapidly, as well as their consequences. Moreover, we are talking not only about physical consequences (destruction), but also financial ones (for example, payment of premiums by insurance companies, loss of assets, etc.). Here is a trivial example: real estate on the coast. The fear of flooding can lead to the fact that people will begin to massively get rid of such real estate, which could trigger a crisis in the market as a whole. And this is just one aspect. Insurance companies, for example, may refuse to insure real estate on the coast or radically increase insurance rates. Banks may stop issuing a mortgage, investors will redirect their funds from real estate investments on the coast somewhere else and so on. To understand the extent of the problem, here are the results of a recent Center for American Progress (CAP) study. If the sea level rises just a couple of meters, for the US real estate market it will cost about $ 900 billion. And this is just one aspect of climate change: fires, hurricanes, droughts. The energy industry tied to fossil fuels (coal, oil, gas) could lose from $1 to $ 4 trillion. (the actual fall in natural gas prices last year from $5 to $2 is a clear confirmation of this). Global warming will provoke a sharp decline in demand for energy assets, which in turn can trigger a chain reaction across the industry with the potential damage of up to $20 trillion. And then a chain reaction will start - insurance companies, investment companies, banks, other financial intermediaries directly or indirectly associated with the energy sector will suffer. Trillion losses will naturally not go unnoticed and will likely provoke global consequences. Such a scenario, of course, is inherently very long-term. But natural force majeure is very dynamic in terms of appearance and course. Considering how serious their consequences have become recently, they may well be one of the factors that will trigger a chain reaction, which will ultimately provoke a new world crisis. The period of unrestrained economic growth, based on monetary stimulation, provoked the appearance of price bubbles in a number of markets, we suggest not to stand aside, watching how everything collapses, but to make money on it. Recall that we consider 2019 the last year of unjustified growth in the US stock market. Already in 2020, it will begin to adjust. The scale of correction is from 50% and higher. Given that in recent years, shares of technology companies in the US stock market have grown by an average of 7-8 times (and some issuers have shown growth of 10 or even 20 times), the US stock market will no doubt become the object of massive sales. We recommend participating in this process, selling both the market as a whole (Nasdaq index) and the shares of individual big issuers (Apple, Microsoft, Alphabet, Oracle, etc.).
NASDAQ:NDXShort
by Trade24Fx
S&P: Sell opportunity if the Channel Up breaks.SPX is trading within a 1D Channel Up (RSI = 64.687, MACD = 28.070, ADX = 51.456, Highs/Lows = 0.2723) since the October 3, 2019 bottom. There is however one bearish divergence signal that calls for a sell towards the 3,070 1D Support if the 1D Channel Up breaks to the downside. That signal is the RSI which is trading sideways (at best) on a pattern that resembles a lot the January - April 2019 Channel Up. That pattern also had the RSI trading sideways despite the price making Higher Highs on the Channel Up and eventually failed to sustain it, broke downwards below the 1D MA50 (blue line) and found Support on the previous Higher Low. If the same pattern is repeated then S&P should seek the 3,070 1D Support. We are waiting for such pull back for our next long term buy position. ** If you like our free content follow our profile (www.tradingview.com) to get more daily ideas. ** Comments and likes are greatly appreciated.
CME_MINI:ES1!Short
by InvestingScope
US stock market: growth out of control The Dow Jones Index is showing the longest period of growth in its history. Given that this growth is completely divorced from economic development, even the most avid bulls in the US stock market are beginning to doubt about prospects: the growth is clearly out of control. There is another fact: when the market grows very rapidly in a very short period, it becomes extremely vulnerable to correction. According to many analysts, a correction in the US stock market is inevitable and its minimum scale is 10% -20%. Jack Ablin, chief investment officer at Cresset Capital, expects a 15% correction in early 2020. The problem of the US stock market in terms of continuing the bull rally is the lack of drivers for such growth: the economic growth rate has long lagged behind the stock market growth rate, on the eve of the Presidential election, there are no serious economic reforms to be expected, companies are stopping their share buyback programs, and their financial results for the fourth quarter in a row show worse growth rates. Perhaps the only chance for stock market growth is an active interest rate cut by the Fed. But the Central Bank made it quite clear that it is not going do that. Recall, we consider 2019 the last year of unjustified growth in the US stock market. Already in 2020, it is going to adjust. The scale of correction is from 50% and higher. Given that in recent years, shares of technology companies in the US stock market have grown by an average of 7-8 times, the US stock market will no doubt become the object of massive sales. We recommend participating in this process, selling both the market as a whole (Nasdaq index) and the shares of individual issuers (Apple, Microsoft, Alphabet, Oracle, etc.).
NASDAQ:NDAQShort
by Trade24Fx
VIX Index: Quo Vadis?After examining VIX Index, with weekly closings for a two-year period, it can be concluded that 12,00 point looks like a strong support (green line). We have witnessed throughout this period four downward trends (red lines). In each rebound (October, May, July) from these four falls, 12,00 point was a pivotal base. I have also plotted a blue line to indicate long-run resistance, which cut every upward trend. Considering these facts and looking into daily data, I think 15,00 point-level will be sooner or later broken and we will observe more volatility in the markets in 2020. Although BREXIT and Trade Agreement risks somehow abated and risks on attitude prevailed in the last quarter, according to my opinion things will not be easily finalised. An increase in the volatility will negatively affect the markets and a fall in the stock market indices will follow.
CBOE:VIX
by Ergun_Unutmaz
"Rally of everything" is doomed: sell Nasdaq100The U.S. stock market has seen a new all-time high. The bubble in the US stock market and the "deal of the decade." We are, of course, talking about sales on the US stock market also - shares of the technology sector (Nasdaq100). The ultra-soft monetary policy, which became the main trend for global central banks after the global financial crisis of 2007-2009, led to price bubbles: stock markets (especially the US and emerging markets), corporate lending (USA and China), bond markets (China and the USA), real estate (EU, China, Canada and the USA), etc. That is, we have a situation that can be called "a rally of everything." When investors buy everything indiscriminately, simply because they have too much money. The ugliest and largest bubble has inflated in the technology sector of the US stock market. In its scale, it has long exceeded the dot-com bubble (and then, recall, Nasdaq lost 80% of its capitalization in just over a year). For example, Apple shares grew by more than 80% (!) over the year, and the company's earnings have remained essentially the same over the years. Even though the company has already squeezed out all the juices from its flagship iPhone (it generates more than 60% of the company's revenue). Why the market has not crashed yet if everything is that bad? We have already answered this question, but we will repeat: the Fed’s refusal to raise rates in 2019 and 3 rate cuts breathed new, but completely artificial life into the rally. Add to this the conclusion of the first phase of a trade agreement between the US and China and get a temporary injection of optimism. Recently, markets have generally switched to artificial life support - meaning a sharp expansion of the Fed's balance sheet due to operations in the REPO market. That is, the patient is already dead. Just waiting for taking off life support. The rally of everything always ends badly for investors. For example Japan in the 80s of the 20th century and the “lost decade”. The sharp increase in gold in recent years proves the fact that growth is at the terminal stage. The simultaneous growth in demand for risky assets (stock market) and safe-haven assets looks very illogical. In general, the number of inconsistencies and various anomalies has long exceeded the critical level. Everything suggests that the end is near. In our opinion, the Fed’s decision to return to the cycle of increasing interest rate will collapse the bubble. The reason for this may be a rise in inflation caused by a sharp expansion of the Fed's balance sheet. Logically, a significant increase in the supply of money will lead to a drop in its value, to inflation. Recall that we consider 2019 the last year of unjustified growth in the US stock market. Already in 2020, it will begin to adjust. The scale of correction is from 50% and higher. Given that in recent years, shares value of technology companies in the US stock market have grown by 7-8 times (and some issuers have shown growth of 10 or even 20 times), the US stock market will become the object of massive sales. We recommend participating in this process, selling both the market as a whole (Nasdaq index) and the shares of individual issuers (Apple, Microsoft, Alphabet, Oracle, etc.).
NASDAQ:AAPLShort
by Trade24Fx
GLOBAL FINANCIAL ENGINEERING SWING TRADING STRATEGY FOR WUOur Proprietary Trading System indicates the following: The Primary Trend (PT) given by the Global Monthly TIME BAR (GMTB) is currently Bullish The Secondary Trend (ST), given by the Global Weekly TIME BAR (GWTB) is currently Bullish The Medium Term Trend (MTT), given by the Global Daily TIME BAR (GDTB) is currently Bullish The Short Term Trend (STT), given by the Global Four Hour TIME BAR (GFHTB) is currently Bullish In light of the above trend analysis we will execute a bullish trade on Western Union Global Entry Signal For Trade #1: Buy @ $20.35 Global Trailing Stop Loss Trade #1: @ $18.88 Global Target Profit Trade #1 : @ $35.00 Global Trade Management Strategy: We applied the Global Trailing Stop System for Global Trading Strategy #3. Check updates --------- The analysis in this material is provided for information only and is not and should not be construed as an offer to sell or the solicitation of an offer to buy any security. To the extent that this material discusses general market activity, industry or sector trends or other broad-based economic or political conditions, it should not be construed as research or investment advice. To the extent that it includes references to specific securities, commodities , currencies, or other instruments, those references do not constitute a recommendation by Global Financial Engineering,Inc. to buy, sell or hold such investments. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice. --------------------------------
NYSE:WULong
by globalfinancialengineering
Impeachment Trump - a time bomb for the US stock marketIn our previous reviews, we have repeatedly spoken about the bubble that swelled in the US stock market and that the sale of shares of American companies or the stock market as a whole is a unique trading opportunity that happens 1-2 times in trading life. Accordingly, to miss such an opportunity is simply a crime against trading. There are more and more signs of impending collapse (see our previous reviews). The stock market has not fallen yet, because the Fed is taking completely desperate steps to keep it afloat (referring to the sharp inflation of the Fed's balance sheet due to operations in the repo market of up to $ 500 billion this is an injection of money into the US financial market). The scale of cash injections is horrifying - the Fed is serious about increasing its balance by 10% soon. This cannot go on for long. We will talk about the consequences of such a policy in our next review. Today we will focus on the main event of the current week, the consequences of which can affect for years. We are talking about the impeachment of Trump and a successful vote on this issue in the US House of Representatives. We want to note that there will be no immediate effect since this whole procedure does not aim to remove Trump from the post of President, but rather is an act to discredit Trump and the Republicans as a whole. The majority in the Senate are Republicans. Not a single Republican voted for, the Senate will fail to vote. That is, in terms of the current Presidency, Trump is not in danger. But the damage to his image and the image of the Republican Party, which he represents, will be colossal. That is, the chances of the Democrats winning the US Presidential election are sharply increasing. For the US stock market, this could be the verdict and the end of the bull market era. Recall, the US stock market owes much to its growth to Trump and his policy, starting from lowering corporate income tax (from 34% to 21%, which led to a sharp increase in company buyback programs and provoked an increase in demand in the US stock market) ending with upholding the interests of US producers (trade wars were unleashed for this purpose). And in general, the Republican agenda is to protect big business, which plays into the hands of the stock market. The advent of the Democrats means a sharp turn in public policy, which will lead to the disappearance of favourable conditions for the US stock market. Against the backdrop of an overbought market, this will be enough for a reversing and the start of sales. Thus, the impeachment of Trump is a kind of time bomb laid under the US stock market. According to Stanley Druckenmiller, one of the most successful American investors, “a change of leadership in the White House will mean the advent of anti-capitalists. Which will trigger the transition of the US stock market to the bearish phase. ” Recall that we consider 2019 the last year of unjustified growth in the US stock market. Already in 2020, it will begin to adjust. The scope of the correction ( rather the bearish phase of the market) is from 50% and above. Given that in recent years, shares of technology companies in the US stock market have grown by an average of 7-8 times (and some issuers have shown growth of 10 or even 20 times), the US stock market will become the object of massive sales. We recommend participating in this process, selling both the market as a whole (Nasdaq index) and the shares of individual issuers (Apple, Microsoft, Alphabet, Oracle, etc.).
TVC:NDQShort
by Trade24Fx
4
Do You Believe in Santa Clause and... his rally?We're in the week that traditionally Santa's rally begins. Sales of tax losses usually end after the 15th of this month, so the coast is clear. At the same time, no one has forgotten the slaughter in the stock markets, which began at the same time last year. Well, do you believe in Santa and his rally in 2019? Yes, I was an obedient child during the year and I believe Santa will give another gift to my wallet… The second half of December is usually associated with stable seasonal demand for risky assets, especially given that the market cleared three significant overhanging clouds (UK elections, USMCA, US-China tariffs). China and the US have reached a first-phase deal in which the US will suspend tariffs in December and cut tariffs from 15% to 7.5% of the September list. Looking at the rest of the world, we see that the OECD's leading indicator confirms current stabilization. After 21 months of delay, the composite leading indicator returned to recovery, which has been historically positive for risky assets. The bearish scenarios and fears of recession were a large part of the investment markets throughout the year, and yet the global rally lifted almost all asset classes in 2019, except industrial metals, EUR and CHF. Looking at all mentioned above, the optimist in me suggests that the risk appetite among investors is likely to remain high despite the expected deviation in the trade talk story. The pessimist in me says that there is no way after a whole year of growth that we will not see a retreat and Santa will not help us… However, in a realistic view, a restricted deal means limited risk as investors become cautious, ultimately viewing Friday's partial deal as a short-term installment rather than a clear path to lasting and complete resolution of the trade tensions. In addition, the victory of Boris Johnson only brought more hope, but it did not draw the clear path of Brexit and the light in the tunnel is far away… At the same time, US stock market is overbought, which means it is vulnerable to a fall if bad news hits us this week. If the momentum of the stock market turns, smart money with big profits, especially hedge funds, may want to sell to lock in the profits. And such sales can accelerate the downward momentum. Looking ahead, this is a scenario that requires cautious attention and investors should be vigilant. Traders will now be forced to consider the prospect of the second phase of the trade deal and what will happen next. But for now, they might be just as happy to put the trade in the rearview mirror for a few weeks and to focus on economic data. The structure of the calendar this year leaves this week as de facto the last week of the year. And this is what makes it harder to explain intraday movements. We are about to see… In conclusion, I'll just say - don't be fooled, these stock markets are mostly controlled by the momentum crowd. Buying is not because of better earnings, better economy or better geopolitics, but because of the upside momentum. Keep in mind that sometimes the crowd is unshakable and can turn up for a penny. Technically, the S&P 500 starts the week by jumping to the $ 3,200 level. This level is, of course, a psychologically important figure, so that in itself was a sensible event. In addition, we also had an ascending triangle on daily chart that was broken up and in fact the price hit our longer-term goal. Now when that it has been reached, nothing is clear except that there is an obvious bullish pressure underneath. We prefer to Buy on the falls at this point, and I would not be surprised to see the S&P 500 drop to 3,100 before I weigh up. Many experts call that the next bullish target is $ 3,250, and another 50 points from now until the end of the year would certainly not be a big challenge. We believe that short-term pullback should be seen as potential buying opportunities. Especially given that so many money managers outside have to pad their results for the year. After all, this is a market that has a direction and of course it is an upside trend. But remember that there is quite a bit of market noise. What is your opinion? Do you already close your positions before the holidays or are you looking to capture the last moment?
TVC:SPXLong
by ForexTrendline
2
Spanish Markets Fundamentals and Technicals Point HigherWith the supposed China "phase 1" deal being agreed upon...even though when no actual facts are really being presented and now the Americans are claiming it will be signed mid January...the trade has still been risk on. Markets globally liked the news as some uncertainties dissipate and we are set for a Santa Clause rally. I like what I see in the Spanish markets, the Ibex. I believe it generally is lagging behind some of the Asian markets, the American and European markets. Remember folks, it is not about forward guidance. There is nowhere to go for yield anymore except stocks in this environment where central banks keep interest rates artificially suppressed. As a fund manager, you cannot be in cash for a long period of time. Your clients pay you for yield. Bonds yield very low...way below the pension fun targets of 8% and they historically are heavy fixed income...not anymore. Real estate? Property taxes do bring yield down and most funds do not want to become REITs. Some say cryptos but that would only happen once it gets regulated. No fund manager would put clients money in cryptos knowing that exchanges do not have the money to pay you back if Bitcoin goes higher because legally, they do not need to since they are NOT regulated. Stocks are the only place to go, and I think these markets that are lagging will be attracting money chasing yield. The Ibex has been in a downtrend with lower highs and lower lows. We then began to base long term and even created a double bottom pattern. You can see that this range was composed of trends and a head and shoulders pattern we traded in the past. Recently, we created a larger head and shoulders pattern which I find very interesting. With todays daily break, which is strong, the trade is triggered. We are looking at the 10,000 for first tp.
FOREXCOM:ESP35Long
by Uncharted-FX
Trump and US-China Deal Attract the AttentionIt was risk-on mood after yesterday Trump teased traders with hope of a US-China trade deal by tweeting “Getting VERY close to a BIG DEAL with China. They want it, and so do we!” If the both sides can’t reach an agreement within the next few days, additional tariffs will be imposed on imported Chinese goods on Sunday, December 15th. If a deal is reached before Sunday, the tariffs will likely not be imposed, and current tariffs may be rolled back. The big question that remains is, “How much of the existing tariffs will be rolled back?” We saw following reports by the Wall Street Journal that U.S. negotiators offered to cut tariffs by 50%. But until Trump makes an official announcement, which must occur before December 15, the tariffs could still be imposed. The Dow Jones index has touched new record highs yesterday at $28,225. At this point in time it’s likely that we will continue to see pullbacks as buying opportunities. If the price break above the yesterday's high we could expect the bulls to extend the upside momentum towards 28,250 (the upper line of Bollinger Bands). But we wouldn’t be surprised at all that if by the end of the day Friday we don’t get any hint of a delay of the tariffs by Donald Trump and than the stock market pulls back significantly. The first support of course is the psychological 28,000 level. The 50-day SMA follow it, which has risen to 27,374. A clear break here could send DJIA 30 to retest the Dec. low at 27,325. If the tariffs do in fact go into effect, it’s likely that this market will gap down on Monday, so at this point it’s probably best to stay aside. All things being equal, but we think that the next 24 hours or so could be a bit dicey. In the next trading day you can throw out technicals of the window and it's possible to see "Buy the rumor, sell the fact" trading. Don’t forget the “Santa Claus rally” either.
TVC:DJILong
by ForexTrendline
DAX30 Still Looks Neutral in Short-termThe DAX30 index currently faces a challenging resistance area at 13,190. The index is holding the rebound from the 23.6% Fibonacci retracement of the October 4 low (13,879) to November 19 high (13,338.25) rally at 12,970. The 55-day moving average has risen to 12,827. Yet the positive slope in the 55-day SMA that increases distance above the 200-day EMA suggests that the bullish trend is intact and an eventual reversal could come later rather than sooner. On upside, if the price break above upper border of Bollinger Bands at 13,350, our first target is Nov. high 13,374.27. A clear break of which could see the bulls to retest the all-time high level of 13,597 registered in late January 2018. A closing price below Tuesday’s low of 12,927 and the 55-day SMA could encourage more selling pressure. However, only a significant fall below 12,660 would put the current uptrend under speculation, shifting the medium-term picture from positive to neutral first. There is located also 50% Fibo level on the above-mentioned rally.
XETR:DAX
by ForexTrendline
UK100: Could the slide bellow 7,190 extend?FTSE100 (UK100) index is also an interesting one to watch this week. The index was bounded in a range above 7,000 handle since August. Note that FTSE has been in a loose inverse relation with the pound since the Brexit referendum. So, in case of a clear Conservative win this Thursday, a strong rally in both the pound and FTSE would be a strong sign of return in investor confidence. Take in mind that the UK elections are held when markets are open, and a new government may be formed on Friday, so volatility could be significant throughout the night and also during all day at Friday. UK100 index were steady on Monday after posting the biggest weekly loss in 9 weeks last week. A firmer pound prevented more extreme gains as the latest poll showed the Conservatives increasing its lead over Labour by two-digits percentage points. The UK100 index is trading below the 50-day and 200-day SMAs on 4-hour chart. The RSI indicator is sloping down on both H4 and D time frames. This morning FTSE broke the first support at 7,200. We opened Short position at 7,190 with Stop Loss above 7,250 and Take Profit around 7,130. There is located the lower line of Bollinger Bands on 4-hour chart and since October this level is acting as key support. On opposite side, the first resistance is the top in the last 3 days at 7,256, followed by H4 50 SMA, middle line of BBs and 200 SMA (on both H4 and daily charts is around 7,320). Do you trade this index and how?
OANDA:UK100GBPShort
by ForexTrendline
FTSE Bottoming Pattern on 4 Hour Trade/ British ElectionsJust before I talk about this trade, just a fair warning that the British Elections are this week on Thursday December 12th. So a high risk event, and will be dominated by Brexit promises. I have spoken about how Central Banks in the Western world are stuck, and they are now attempting to maintain confidence in the system. They want to go back to easing and QE but remember, QE was supposed to be a one time desperate policy to prevent a 1920-30's like great depression. When we go back to QE, people will realize it did not work in the first place. They will use different names to mask QE, but this is the confidence crisis that looms. These central banks have one role now: to keep assets propped. This will eventually be morphed into buyers of LAST RESORT (instead of lenders of last resort...which was the central banks original mandate when they were first being formed). I am expecting higher equity prices in the US because there is nowhere to go for yield anymore. Also, many investors know the Fed will support this market. Not to mention the President needs high stock markets if he wants to win the next election using "Keeping America Great" slogan. Yes, we will have pullbacks, but equity markets will go higher. I speak about why this can be a problem for the Fed and the US Dollar. Post linked below. In terms of the current FTSE chart, we did make a bottoming/ double bottom pattern at a flip/support zone. From here, we had a nice break above a flip zone marked in blue, a strong break, and now it seems we are making our first higher low which will be confirmed with this current 4 hour candle close. Target will be the flip zone at 7340 for the trade.
FOREXCOM:UK100Long
by Uncharted-FX
Potential Pullback on S&P 500?The American S&P 500 returned to the region above 3100. Recently the index testing the upper limit of the daily Bollinger Bands, which is also near to the bullish channel resistance line. That's why we may looking to short this market rather we would like to see a buying opportunity underneath. The 50-day SMA is currently trading around the 3030 level, which is the top of the support “zone” that extends down to the 3000 handle. We like the idea of buying a bounce that we can take advantage of cheaper pricing. On upside the first target is at 3137, followed by 3200.
TVC:SPX
by ForexTrendline
3
REVIEW: DJI (Wall Street), DAX and nuclear options. I've looked into the DJI and the DAX because they are connected. I also considered events affecting the Hong Kong index. In the text below, I consider China's 'nuclear option'. Overall I'd say the probability is greater for the south on these indices (from this point in time). But caution - because there is a residual probability for the north and I can't know how far south the markets may go if the markets are with me. These are very troubled times. 1. The markets are overbought because of QE4.0, lowering of interest rates and high hopes about a China 'Phase one' trade deal. 2. But there is trouble in the Hong Kong Stock market. 3. POTUS signed the Hong Kong Democracy Act which could cause the Chinese to retaliate in some way (nobody knows how). The 15th of December 2019 is an important date on which $160 Billion of tariffs on imports to the USA, get lumped on China or they are withdrawn. If the tariffs are withdrawn, expect markets to head to the moon (stupidly). If the tariffs are applied, expect a correction of some sort. Bond troubles In other trouble China has begun the so called nuclear option of selling off US Treasuries. Note that Treasuries are bonds, which means that money is owed to China by America i.e. they represent a debt owed by the US. Why would China sell off US Treasuries - which are debts owed to China? Perhaps because China expects the US Dollar to be worth less in times to come. It's like this - if I lend you money fixed in USD value, and then you decide to devalue your US dollar by various means, it means I'm getting back less value. For an exploration of Bonds go here . China holds about $1.2 Trillion of US debt. A sell off of US Treasuries is said to destabilise financial markets. How - is a separate complex story. The point is that China's retaliation on the Hong Kong Act could be this 'nuclear option'. The point of all this is that there are complex issues affecting the markets. Disclaimer: Nothing shared here is investment advice or encouragement to trade in securities. If you lose your money, kindly sue yourself.
FOREXCOM:US30Education
by Captain_Walker
1