Bags: credible new increases? Expectations on Eur / Usd, Oil and Gold

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Below is the interview with Davide Biocchi, professional trader, to whom we asked some questions about currencies, some commodities and the expected scenarios for the stock exchanges.

The euro-dollar travels close to 1.09 after having failed the 1.10 area attack. What to expect now?

The euro-dollar is clearly inserted in a sideways textbook trend, with a base of 1.076 and an upper limit of 1.098 and widening a little we could say 1.075 and 1.10.

The cross moves in this range and is clearly waiting for something that may be the first Central Bank to move or a possible change in certain contexts.

We don’t know what it may be, but it is clear that the euro-dollar does not move until it reaches a defining point.

The trading range I was talking about before concerns just over two figures and it is already sufficient to have an interesting operation.

For a true trend, you have to wait, because everything in an impasse after the coronavirus and not to which central bank will move before the others or which situation will occur.

Gold failed to hold above $ 1,750. Do you expect further declines in the short term?

Gold is not in a very different situation from the euro-dollar, being in a trading range of 100 dollars between 1,675 and 1,775 dollars.

Within this range, gold is moving with the same characteristics as the euro-dollar and will go vigorously in the direction from which it will exit.

In my opinion, an exit from the top seems more easily conceivable, it is not said that in the end it will be like this.

I would like to spend a few words on the silver that gave the strongest signal of all, on the wave of gold and a fork that had opened with the latter, but also of the huge injection of liquidity into the system.

Beware of silver in the event that it exceeds $ 20 because this would be a very significant movement.

Oil continues to rise and tries to put pressure on the 34 dollar area. Is the rise underway expected to continue?

Currently there is not a huge demand for oil, but there is a problem related to the rarefaction of the supply, given that the number of active augers continues to drop.

When demand returns, oil could have an even more explosive recovery, while for now it could even settle a little on current values.

In the meantime, an increase in implied volatility should be noted and this means that a little more money is required from those who want to buy options.

On oil, perhaps another interesting movement is expected and in this light I point to the upside that there is the potential closing of the gap, while on the downside the support is at $ 28.5.

In light of what has been said so far, what indications can you give us for the stock exchanges?

The stock exchanges are now walking at two speeds if we compare the European to the United States and this is due to the handful of covid-stocks, large globalized companies that have a decisive weight in the lists, digging a furrow between them and the others.

I refer to the 4 companies that capitalize over 1,000 billion dollars, namely Microsoft, Google, Apple and above all Amazon, but also to those that come close to these such as Facebook.

The stocks of these companies seem to be heading towards new relative highs thanks to globalization and their business.
If you took these companies away from the Nasdaq Composite as well as the S & p500, you would realize that in reality the rest of America has remained at stake.

We are experiencing a global trend that is best represented by something that resembles the Eurostoxx50.

Meanwhile, we report that the European stock exchanges continue to be in a trading range, with the Ftse Mib between 16,000 and 18,000 points, the Dax between 10,000 and 11,000 points and the Eurostoxx50 between 2,700 and 3,000 points.

The moment these indices leave the trading range, they will create a rapid trend.

Somehow now the stock exchanges are pricing the post-coronavirus damage count around these levels, and time will tell if the consolidation took place too high or too low and only then will there be a sudden adjustment of the market to the new parameters. .

At the moment we do not yet have a realistic damage count and therefore I believe that regardless of the daily issues, we notice that other issues are back on the scene.

I refer, for example, to the stormy relationship between China and the United States, but also to the fact that the US presidential campaign will soon begin.

Even in Europe the situation is complex because it will be necessary to understand how it will be possible to get out of the impasse created between countries favorable to creating real aid and countries more oriented to loans subordinated to reforms.

It is all in the making that depends both on the count you do before and on what you live during.
Perhaps the stock exchanges could also go to settle down a little higher and it seems to me that at this moment there is more an upward inclination than a downward inclination, but I would not like it to be unjustified optimism.

We will see this when the resistance eventually breaks and if this should happen as a result of particularly favorable news, then it is clear that in that case we could witness a boom in the stock market.



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