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Stock Market News: Crash of Indexes

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In less than 10 months, stock indexes have lost all those privileges they gained after the elections of 2016. Although pessimists warned of a bubble, the optimists’ beliefs pushed quotes up. Analysts believe that the formal cause of this is the publication of unsatisfactory financial reports, although this is about a retracement to reach equilibrium of the market.

Shares of Apple and Goldman Sachs are among the drawdown leaders of the last week.

Following Facebook, whose shares keep falling against the background of the unsatisfactory financial results and scandals about Mr. Mark Zuckerberg, the Apple’s shares have crashed too. This technological giant has lost more than 5% after several component-supplying companies, including Lumentum, had dampened their forecasts for the next quarter.

Lumentum – is one of the corporation’s main suppliers, whose components are used in the Face ID technology, related to the Apple smartphones. Weak financial reports and negative forecasts declined the company’s shares by 33%, which immediately affected the Apple’s shares. Moreover, a number of microchip suppliers, which also do business with technological corporations, have lost around 1-4%. The decline of the Apple’s quotes was one of the main reasons for NASDAQ index to drawdown by almost 2%.

If one of the reasons for the drawdown of NASDAQ index was the Apple’s shares, then Dow Jones index has lost more than 2% because of the shares of Goldman Sachs. On 1st of November, mass media released the information about the suspension from of work of the former head of the Asian Division Mr. Andrea Wellu, who had previously been downgraded in view of the scandal about 1MDB Malaysian State Investment Fund. Following the result of the investigation, the Malaysian State Investment Fund had been implicated in some corruption cases, involving top managers of Goldman Sachs.

The first scandal broke out back in 2015, when some information on the possible unauthorized transfer of around 700 million US dollars to the accounts of the former prime minister of Malaysia surfaced. The investigations had been carried out in at least 10 countries for more than three years. According to the information from the US Department of Justice, which was conducting an independent investigation on its territory, the top managers of the Asian Division of Goldman Sachs aided by the country’s government, had embezzled and laundered around 3.5 billion US dollars. In September 2018, the ex-prime minister was arrested on charges of violations of the country’s tax legislation.

Shares of Goldman Sachs has declined by almost 7.5% after the current minister of finance of Malaysia had stated about the government’s plans to charge Goldman Sachs with all fees that had been paid to the bank in compensation for the transactions it made for 1MDB totaling several dozens of BUSD.

The quotes of energy companies also decline, albeit to a lesser extent. The cost of their quotes depends on the price prospects for oil.

There is no sense to expect any growth of stock markets for the following reasons:

  • Markets are full of negative information, which brings bearish trends for the quotes of indexes;
  • Deceleration of the US GDP growth will slow down both currency and stock markets;
  • The US stock market is overvalued and has no fundamental factors for further growth in the coming month.

Traders can consider some earning options on separate shares of companies. For example, it could be companies from biotechnological sector. But taking into consideration the total stagnation, such the strategy is quite risky.

Currency market overview for 12.11.18

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The competition between the US currency and the European currency was the most significant event of the beginning of the week. When both opponents are taking each other down, there is nothing else we can do, but to stand by and watch. The issue of both base currencies plays into the hands of those, who prefer to deal with less volatile instruments.

EUR/USD

At close of the American session, EUR/USD volatile currency pair has declined by 0.86%, reaching the level of 1.1238. Analysts say that the next support level is 1.1236, but even this level will apparently be overcome soon. It is notable that, under these circumstances, EUR has increased against GBP (+0.11%), but has fallen down against JPY (-0.82%).

The bearish tendency about EUR/USD currency pair is getting stronger and stronger. Understanding that Brexit is not only a problem of London (that is now cutting all diplomatic ties), but also a problem of the entire Eurozone together with the increased risks of Theresa May’s political defeat along with the Italian problems certainly speak to the fact that EUR will not grow in the near future.

Analysts think that the adoption of the new Italian budget (which will definitely make living-large Italians to hunker down), will make the European Central Bank to cut its forecasts on headline indicators in December. This will automatically constitute as the acknowledgement of the economic growth deceleration. But the European Central Bank has no alternative: the necessity of a structural support to the banking sector will anyway tighten its monetary policy. At the same time, it is felt that the financial problems of Italy will not affect other countries, and therefore, we shouldn’t expect any collapse of EUR.

USD is the currency that also actively prevents EUR from declining. As we may see, the US gross domestic product is slowing down its growth. In other words, now both currencies experience hard times, so it is fair to assume that the consolidation will begin in the range of 1.1 – 1.135. There are at least two requirements for EUR/USD currency pair to follow in order to pass the lower threshold of 1.15 and to get closer to 1.18:

  • Common ground between the UK and EU with the subsequent ratification of the agreement by both parties. If the irregular Brexit process carries on, then EUR will fall down following the British currency.
    Addressing Italian issues and return of the country’s economy to the pre-crisis level.
  • So far, the addressing of both problems is far from clear, so EUR/USD currency pair will most likely continue to decline.

USD/RUB

USD/RUB currency pair has increased a bit by the end of 12.11. There were two factors weakening RUB: some small strengthening of USD in the beginning of the week and the reduction of the oil cost below the level of USD 7. As at 13.11, the opening price was 67.846, while in the morning USD had collapsed down to 64.446.

USD/JPY

USD/JPY currency pair keeps demonstrating an ascending trend that will most likely continue for a few days more. Later in the week, we expect a small decline of the price in the frame of the downward adjustment. The JPY weakening plays into the hands of the Japanese government that hasn’t been able to get closer to its targeting inflation level for several months already.

USD/CHF

The volatility of USD/CHF currency pair has suspended the growth of the traders’ enthusiasm. Usually, quotes of this currency pair reflect the quotes of EUR/USD currency pair, so analysts expect its growth concurrently with the collapse of EUR/USD currency pair.

Market overview for 05.11-09.11

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The main factor that had the greatest influence on all the world’s markets this week was the US Congressional elections. Despite the common victory of the Republican Party represented by Mr. Donald Trump, the Democratic Party has managed to get an essential advantage. Now they have a possibility to block some part of the president’s initiatives, which brings some imbalance into the overall policy of the United States of America.

1. Oil market

Predictably, the oil quotes has declined to the psychological level of USD 70 per one barrel. But what was really surprising was the fact that they could breakthrough this level closing on Friday at the level of USD 69.64 (Brent oil).

The following factors are the main reason of it:

Investors’ concerns about the economic development slow down and the continuation of trade wars against the background of the Republicans’ victory. Record production level. This week’s statistics has demonstrated that the oil production level in the United States of America, Russia and Saudi Arabia stays at the historical maxima – more than 33 million barrels per day, i.e. 1/3 of the world’s production level. Increase of reserves in the United States of America. The report published by the US Department of Energy has shown that the oil reserves increased by 5.7 million barrels within this week, while the forecast was about only 3.2 million barrels.

Current week forecast: experience shows that the influence of the Friday’s reports on the oil quotes is short term and local. The level of USD “70” is the strong support level and its clearance is more of the inertial price motion (channel clearance with the following retracement). So, in the beginning of the next week, we will be able to see the reverse in the range of USD 70-73.

2. Stock market

The US indexes has responded the election results positively, demonstrating the aligned growth since the middle of 6th of November after the announcement of the provisional results. A small retracement has happened by the end of the week, but it has no significant influence on the bigger picture. At the same time, the European DAX index demonstrated high volatility, breaking even at the end of the week. Trade wars, Brexit and the Italian political crisis keep pressing on the European stock market.

Current week forecast: “bearish” state of the world’s stock markets still dominates and it would be imprudent to bet on the growth.

3. Cryptocurrency markets

The Congressional elections in the United States have suddenly boosted the cryptocurrency market. Although this market was declining by around 1% at the end of the week, it is still is a positive dynamics. The dynamics of ВТС follow the common trend of the market, although its share in the total capitalization has fallen down to 52.2%.

Among TOP-10, Bitcoin Cash has demonstrated some small growth – its price had increased from USD 535 to USD 635 since the beginning of the week. However, its price has turned back to the level of 6th of November by the end of the week. According to analysts, the local, but very strong factor was the victory of the blockchain followers in the US, who supported its legalization. The biggest ctyptocompanies create strong lobbies to protect their interests in the government, although there is a strong resistance coming from SEC.

Current week forecast: the situation on the cryptocurrency market is still under active. According to CoinMetrics, it is only each fourth coin of the whole emission of ВТС came into motion. In other words, investors use “buy and forget” approach, which is the case for a long-term investment. That’s the main reason why we will not see any speculative bubble as we saw previous year. The price range forecast for the next is 200-220 billion US dollars. Taking into account commission of stock exchanges and margin, it is not rational to earn on short-terms fluctuations in such a range.

The US Congressional Elections: No Surprises

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Few days ago, on 6th of November, the congressional elections were held in the United States of America, the preliminary results of which have already been published in mass media.

Investors were waiting for this date most of all, because the election results could fundamentally affect all main quotes from the USD dollar on down to stock and commodity markets. The uncertainty of the elections lies in the fact that there is a serious conflict between the executive and the legislative branches.

The dissatisfaction with the policy of Mr. Donald Trump has even made some officials to think about the impeachment after the elections. Investors preferred to exit the market temporary, due to which some part of assets has demonstrated a negative trend in the beginning of the week.

The question was who would finally win. Shaky victory of republicans doesn’t calm markets The US Congressional elections are just intermediate elections, because they are held in between the presidential elections. There are two competing political parties – democrats and republicans. Moreover, the members of the first party are sincerely expecting the victory, because it would help them to undermine attitudes of Mr. Trump, who is presenting republicans.

6th of November is the day when Americans elect the Congress representatives and the representatives of the local government authorities, including: · 435 representatives of the Chamber. This is a full complement that is elected every two years; · Around one third of the Senate members.

They are elected every six years, and this time there are only 35 members of 100 to be reelected; · Governors of 36 states, as well as the legislative branch of 46 states. The party that has an influence on the Congress (i.e. the majority) automatically gets benefits in a legislative area.

In other words, if the election results were in favor of democrats, they would have obtained a right to block the initiatives of the US President. The same rule goes for the local government authorities. Every ten years (i.e. in two years) the party that governs a state, has a right to change the electoral boundaries, thereby indirectly affecting the results of the future elections.

The forecasts before the elections were pretty discouraging for investors. There was a possibility that democrats would gain a majority of votes in the Lower Chamber of the Congress. And, if republicans keep the control over the Senate, there will be a strong confrontation when taking any budget decisions. If republicans prevailed over democrats, then they would have retained a possibility to finish their reforms: for instance, tightening of the immigration policy, reduction of taxes and cancelation of the compulsory medical insurance system.

Later, on 7th of November, despite the fact that the vote counting process isn’t finished yet, the preliminary results are already providing some opportunities to summarize the situation. Republicans still have the majority in the Upper House (and that means that this is no longer about the impeachment of the president), but they are losing their majority in the Lower House. That means that Mr. Trump still has a right to designate the right persons to the official government positions through the appointments in the friendly Senate.

But the House of Representatives, where democrats have the majority now, will definitely be blocking the president’s legislative proposals and slowing down the financial of his initiatives. Against the background of the election results, the US dollar has been devalued against other currencies, because now the prospects of the country’s economic policy are unclear.

Stock indexes and gold are rising up. Oil is declining. At the same time, it is pretty hard to predict for how long the election results will be influencing markets.

Commodity market overview for 02.11.18

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The last day of the trading week wasn’t so good for the majority of the commodity markets’ assets. Most instruments showed the recession, thought not very significant. Traditionally, trading peaked at the morning and daily hours of the eastern European session, after which markets demonstrated some downfall. That is partly due to the geopolitical problems and traders’ uncertainty. The classic profit taking on the eve of the weekend is partially responsible for that.

1. Oil goes into a dive

The oil quotes demonstrated pretty high volatility on Friday, giving traders a hope for the reversal to the psychological level of USD 75. As at 09:00, January futures of the Brent oil were at the level of USD 72.75 per one barrel. During the peak of the trade, the quotes were reaching the level of USD 73.49, but by the end of the trade, the price reduced to USD 72.57, which is 0.44% lower than the opening price.

For the second consecutive week, the oil quotes has been showing not very strict behavior, slowly but surely reaching the level of USD 70. The main falling trend is due to the trade war and the forthcoming sanctions of the United States of America against Iran. The new sanctions pack will come into force on 4th of November.

Experts predict that after this date, the export of Iran oil will be reduced by approximately 1-1.5 million barrels per day. But the US government reported that it is ready to give a support to the countries that will be most affected by the alleged sanctions. It concerns eight countries (India in particular) that are among the main buyers of Iran oil. So for now it is quite difficult to make any accurate forecasts of the market reaction, because the supposed deficit arising from these sanctions may be converted to the market glut. Moreover, Saudi Arabia and Libya announced their intention to increase the oil extraction. As a whole for October, the oil extraction by OPEC has increased by 430 000 barrels per day (up to 33.33 million).

2. At day-end: gold is in the red, silver – in the black

As follows up to the day, XAU/USD currency pair went to a small minus. The European session opened at the level of USD 1230.9 per troy ounce. The European session closed at the level of USD 1234.60, which is 1.4% lower than its opening level. The maximum mark was “1238.2”; the minimum mark was “1231.4”.

It can thus be said that for the gold Friday trades were quite calm and without any sharp growth or downfall. The midpoint was the session opening and closing level. According to the results of October, the gold increased by almost 2% against the background of the unstable political situation in the world. In a traditional way, the gold confirmed its status of a “safety harbor”, compensating some part of other assets’ losses. Over the year as a whole, the tendency is negative – the investors’ losses amounted to more than 3%.

In contrast to the gold, the silver demonstrated smoother positive results on Friday. At the session opening on the level of “14.74” and its closing at the level of “14.745”, the volatility corridor per day was “14.655-14.92”, which is lower in comparison with the gold. The daily chart has little strongly marked peaks and drawdowns, but on monthly result, the silver has demonstrated some insignificant downfall. There is also an annual downfall – 13.74%. So the gold acts much better as a safety asset.

In general, the commodity market forecast for the next week is negative. The ground tone will be created by the oil quotes, the prospect of which lies in the bear trend. There is a chance for a small growth of the gold price, but much will depend on the statistics published in the beginning of the month and on the US dollar exchange rate.

Stock market overview for 02.11.18

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The end of the week and concurrently the beginning of the month continued for the stock markets with the downfall tendency. On 6th of November the United States of America are planning to conduct the Congressional elections, after which we will see the approximate direction of their economic development. Until then, investors prefer to close their transactions. The end of the week has also played its part – on the eve of the weekend, traders are locking in their profits.

1. Dow Jones

Dow Jones was the most stable among all American indexes, although it demonstrated some decline as well. The price reduction at the end of the session was USD 109.91 (-0.43%). At the closing of the session the price was USD 25270.83, the daily range: USD 25078.72 – 25578.98.

The growth leaders were Chevron and Exxon securities, which grew up by 3.2% and 1.59% accordingly. Some positive trend has also been demonstrated by securities of some investment banks. Apple, Intel and Pfizer were among the downfall leaders – their quotes declined by 6.63%, 2.30% and 1.69% accordingly.

2. S&P 500

On Friday this index were in the red – during the trade day its quotes reduced by USD 17.31 or by 0.63%. At the European session opening, the futures price of this index was USD 2751.31, the daily range: USD 2700.44 – 2756.55.

Despite the fact that this index demonstrated bigger drawdown compared to Dow Jones, the quotes of some companies in its composition has increased more than others. For instance, Starbucks securities increased by 9.7% and VeriSign securities – by 17.2%. Though, it also has some downfall leaders. Kraft Heinz securities declined by 9.73% and some number of companies lost 4% to8% thus compensating the growth of the leaders.

3. NASDAQ

NASDAQ index was the Friday’s downfall leader of the American stock market. At the session opening its price was USD 7424.02, and at the closing – USD 7356.99. Therefore, the futures of NASDAQ index declined. Its daily range was USD 7298.68 – 7466. Such a big volatility is due to the temporary problems of the technological corporate groups that are trying to reach their balanced state in the near term.

The growth of individual companies of this index was 30% to 67%. Biotechnological companies (-48%) and pharmaceutical companies (-32%) were among the downfall leaders.

A few words about other indexes….

4. MMVB-RTS

During the last trading day, this index demonstrated quite a good growth, in spite of the geopolitical problems. Following the results of the day, its growth was +0.79%. Highlights: while European and Asian indexes roll back to the level that is lower than the level of early 2018, MOEX index reverses to the positive trend. If, since 2018, the growth of the US indexes is 5.55% – 9.56%, then MOEX demonstrated 14% of profit.

5. DAX

Following the results of the day, this index won back some losses of previous periods (+.44%). The truth is that against the background of the downfall of the quotes of the European companies’ assets, this growth is intangible. Since the beginning of the year, this index has lost 14.3%.

6. Nikkei 225

The growth within the day was +2.63%, so that this index has finished the week positively, compensating some part of the losses taken during previous weeks. The loss of the index investors is 1.31% since the beginning of the year.

Next week forecast

We expect both-side volatility till 6th of November, so it is quite difficult to make an accurate forecast for this period. Analysts assume that during the whole next week, the quotes of the assets of American companies will be falling down, reaching values of early 2018. As for Asian and European indexes – the expectations are more optimistic, because we already see pretty strong resistance levels.

TrendWave: universal indicator for trend strategies

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Most of strategies can be tentatively divided into two groups: trading on a channel breakout and trading on trend reversals in overbought and oversold areas. There are many channel indicators. Most of them are built on the basis of moving averages and their calculation formulas are different.

The first part of strategies implies the following fact: the price moves inside a channel in most cases. But if a breakout happens (and this is not about a retracement or an inertial motion), then a new strong trend is emerging.

The second part of strategies is built on the rebound of the price off a channel’s boundaries. The question is how to determine the direction of trend? Will it be a breakout or a rebound? And this is the case where trend indicators can help.

TrendWave is the unique author’s indicator that acts as an oscillator for the intraday trading. Only a few years ago it could be bought for USD 100, but today you can easily find its free template in the Internet.

TrendWave indicator and the strategy on its basis

TrendWave is an oscillator, the core of which is simple and medium exponential moving averages. Its benefit in comparison with other analogue indicators is in fact that it finds opening position points not only on a dynamic market, but on a flat market as well.

TrendWave settings

WavePeriod. This is the setting of the indicator’s algorithm period. It is chosen for each specific timeframe.
AvgPeriod. The aggregative period of both moving averages. The higher value it has, the smoother МА and ЕМА will be and the lees frequently the entrance signals will appear, but the more accurate they will be by excluding the price noise.
SoundAlert. This is the activation of the alert at the appearance of the signal.
EmailAlert. This setting activates the sending of signals to Email.

It is fair to say that there are some negative reviews of TrendWave indicator in the Internet. However, there are no ideal indicators and strategies. You still need to be able to understand the market and its volatility, to choose the right timeframes and settings. The proposed strategy uses Hooya Map as an additional indicator. Hooya Map is a tool that draft signal lines on the basis of MACD, МА and stochastic. The trading is carried out on any currency pair, but preferably with the high volatility. Timeframe is Н4, may be reduced to Н1.

– TrendWave settings: WP = 10, AP = 21, levels: 60, -60, 50, -50.
– Hooya Map settings: basic. Stochastic settings are D = 3, S = 3, MACD moving averages are 5 and 34. As for other parameters – we can set “0”.

Long position opening conditions

– TrendWave indicates a blue point on a chart.
– Hooya Map on a signal candle shows three green points. The appearance of a signal on a candle is permitted after a signal candle, but not later.

Here we open a transaction on the next candle after both conditions. The stop length is selected by a test method for each currency pair (around 20-30 points). The target profit is 20 points. After which we shut down 50% of positions, transfer stop to a breakeven point and start trailing with the step of 20-30 points.

Short position opening conditions

– TrendWave indicates a yellow point on a chart.
– Hooya Map indicates three red points on a signal candle. The appearance of a signal on a candle is permitted after a signal candle, but not later.

Entry and exit conditions are analogous. We pass first three Monday candles and last three Friday candles that are beyond the statistical accuracy frames. Do you like this strategy? So, share it with your friends, test it, try to optimize it and leave your feedbacks! Have a good and profitable trading!

Oil continues to decline against a backdrop of the political conflict

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Oil continues to decline against a backdrop of the political conflict

Oil quotes continue to fall, gradually approaching to a psychological level of USD 75.00. As at 12:00 PM, 24th of October, the price for December futures of Brent oil was at the benchmark of USD 75.90, which is 0.7% lower compared to the previous day. Just in 24 hours quotes dropped by almost 4.3%, completely fixing a bear trend all over this week.

According to leading financial analysts, here are some main factors causing such a sharp price collapse:

Escalation of the diplomatic conflict between the United States of America and Saudi Arabia in light of allegations of accessory to murder the American journalist and call by some senators to impose sanctions against Riyadh.

General world stockmarket crash. In light of the geopolitical conflict between the United States of America and China, traders prefer to move money out of risky assets while waiting for volatility to pass.

Increase of the apprehensions among traders with regard to the consequences following the sanctions placed by the United States of America on Iran. Despite the growing political conflict between the United States of America and Saudi Arabia, Riyadh stated that it had no intention of imposing an embargo by analogy with the year 1973, and that it would make every effort to respond to any demand for “black gold”.

This statement, made by the oil minister of Saudi Arabia on Tuesday, 23rd of October, slowed down the quotes decline speed, but, at the same time, had no significant impact on it. Another cofactor that supported quotes decline was the publication of data on changes in oil reserves issued by the American Petroleum Institute. Reserves growth to 9.88 million barrels just made things worse, pushing quotes to a benchmark of USD 75.00. Moreover, oil quotes are pressed by the recovery of the US dollar, and the reason is that “black gold” is denominated in this currency.

Quotes Prospects

According to analysts, quotes decline will continue in the following days, but it will hardly overpass a psychological resistance level of USD 70.00. As reported by the Industry sources early in the month, Saudi Arabia was going to keep prices in the corridor of USD 70-80 with the purpose of profit maximization, which partially convenient for the United States of America. The recent demand of Mr. Donald Trump to decrease prices has finally elicited a response, although implicitly. A trend fluctuation will likely remain within the range of USD 70-75 by the end of the month, but in early November traders expect a spike in prices. New US sanctions against Iran will enter into force on 4th of November, which will drastically reduce export and therefore increase oil prices.

Weekly Market Overview. Stock index dynamics from 15 Oct – 21 Oct

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Global stock markets continue their negative trend that has been going for several months. As on 21.10.2018, some stock indexes has already fallen below the level of the late 2017 and still keep declining.

The worst situation, by far, is on European and Asian markets. As illustrated in the chart above, the Japanese Nikkei 225 index has already passed the break-even point of 2018. Those investors, who had put their money in the European DAX index in the beginning of 2018, have already lost around 12% of the money invested. The American stock market runs a bit better – its main indexes still remain above their values of 1st of January, 2018. The October crash was so wide and compound that there is every reason to believe that stock investors will be out of their pockets by the end of the year.

Analysts indicate several main reasons of the stock market’s crash in October:

Autumn depression that leaves its stamp on the traders’ bahaviour. The formal reason was the publication of negative financial reports of a number of companies, and the negative forecast regarding the consumer demand. Without knowing what to expect, investors are getting themselves ready to the worst scenarios, trying to switch to other assets.

As is well known, US congressional elections will be held in the early November, so investors prefer to wait it through, staying out of the market. What also contributes to the deflation of the stock bubble is the political stand-off between the executive and the legislative branches and the conflict between Mr. Donald Trump and the US Federal Reserve Fund. And now to the local overviews of separate indexes over the past week.

Dow Jones

The industrial average over the past week has demonstrated some relative stability. After a slight growth shown in the beginning of the week (against the background of the negative financial reports), the index of a number of companies went down a bit. Here are the leaders of the past week’s fall: IBM (computing machinery), Caterpillar (farm and building machinery), Home Depot (building tools stores). Although, the decline of Dow Jones is slower than, for example, the decline of S&P 500, the probability of growth within next two weeks is practically non-existent.

S&P 500

The past week was pretty calm for this index. In comparison with the beginning of the week, this index has even grown a bit. Truly speaking, this growth was so insignificant that there is no sense for investors to expect any profit. Despite the stability of the past week, S&P 500 will continue to decline. “2700” benchmark may act as the psychological level, but in connection with the overall market stagnation, investors should be ready for a pullback to “2600” benchmark by the end of October. This is also confirmed by Fibonacci levels (“2613” – 38,2%).

NASDAQ

NASDAQ index, which was really promising only a few weeks ago, has become quite upset for investors last week. And it could be said that the reason of it was a global market drawdown, but this is the exact sector was one of the most far-ranging ones. Securities have crashed without any local obvious reason. Apple securities declined by 2%, and the week’s best-performer was Netflix that has just published quite good financial reports – 5% drawdownNASDAQ can be described as one of the most unpredictable indexes. Pay your attention to the fact that, in comparison with other indexes showing a clear descending trend, NASDAQ demonstrates two-ways volatility. This suggests that, in the short term, an ascending trend is quite possible as well as a chance to get some insignificant recovery after the elections in the United States of America. Most likely, investors should expect a pullback to 7000, after which some careful purchases will begin.

Nikkei 225

The Asian markets go down following the American ones. But iAby the end of this week it could even increased a bit. The general monthly trend has a clear descending trend. So far, the Asian market follows the US stock market and we shouldn’t expect any recovery of this index. If at the end of September quotes reached their maxima over the past 27 years, then now they are at the level of March, 2018. However, in comparison with the quotes of the last five years even this value is still pretty good.

Quotes Prospects

After the election victory of Mr. Donald Trump, the US stock market had increased by more than 30%. After the dotcoms crash in the year 2000, stock indexes had an ascending trend and there were no any adjustment over 20%. The fast growth of security quotes after the elections in the United States of America triggered what is known as a “bubble”. According to analysts, as at the beginning of 2018, the stock market very overvalued, and what we see now is nothing but an adjustment in order to reach the balanced state. We recommend making bets on the fall of all indexes through the first 10 days of November. The probability of the stock market recovery at least to the June-August level by the end of this year is quite small.