The year begins extremely unsuccessfully, so we will earn

6 ene 2020

In the news plan, the year began extremely unsuccessfully. The elimination of Iranian general Kassem Suleymani (he was the second most important in Iran after the main ayatollah) was headline news. We wrote about in our weekend reviews “Escape to safe-haven Assets Activated: $ 1800 Gold” and “Will the Suleyman Killing Become a Black Swan for the US Stock Market”.

Will this event become a real "game-changer" we will see. But the primary reactions of the markets are showing how the events will develop in response to any the conflict escalation. Gold will hit 1800. Oil, if Iran decides to block the Strait of Hormuz, will continue to grow. Stock markets rush down. So it’s possible and even necessary to earn.

Weak data on business activity indices were shown from all around the world. But the main event was the publication of the US Manufacturing Sector Index, which fell to a 10-year low. So our expectations of sales in the US stock market have the background.

Our basic position - recommendations to sell the US dollar. In December, the dollar lost about 2%: this was the maximum monthly decline over the past 2 years.

Weak data and the threat of collapse of price bubbles in different segments of the US financial market will push the Fed to further lower rates and continue to inject money through repo markets or new quantitative easing programs. Which will inevitably provoke a new round of dollar weakness?

So we will buy the USDRUB in the future. Selling the Russian ruble from current points is a great opportunity, despite our expectations of dollar weakness.

This week the statistics on the US labour market is expected to be published. And this is a guaranteed surge of volatility and a great opportunity for making money. But we will talk about this later.