Ray Dalio still believes in gold (2)

The main reason for declining interest and appetite for gold is the fact that the noble metal does not fulfill its function of a protection asset. Gold prices dropped in February after massive sell-offs on the stock markets, continuing to fall over the next few months, amid the recovery of indices aimed at testing their peaks.
In addition, the appreciation of the dollar, in the midst of two Fed interest rates, was another factor triggering a fall in the price of gold.
The strong growth of the US economy, in an almost full employment environment, allows the Fed to think of two more interest rates this year.
Of course, there are serious prerequisites for the Fed to refrain from one of the two potential interest rates, in a climate of global geopolitical uncertainty and the growing trade war between the US and China.
Gold broke the key level of support at $1,205 and went down to the next major $1,194 support. At this stage, the latter level manages to limit the further depreciation of the "yellow metal". According to technical analysts, however, a break of $1,194 may open the way for a further decline to $1,181 an ounce.

Ray Dalio still believes in gold (1)

The billionaire investor and founder of the world's largest hedge fund, Ray Dalio, retains his belief in gold. That happens, despite the sharp decline in the metal, which today reached a new low for the last one over a year - down to less than $1,290 per ounce.
Dalio, who runs the Bridgewater Associates, has kept its stake on the two largest index-traded funds on gold by June 30, despite the fall in the metal.
By today, Dalio has 3.9 million shares of the largest exchange-traded index fund based on the gold price of SPDR Gold Shares and its 11.3 million shares in the second largest fund - iShares Gold Trust, according to data of regulators.
For the three months until the end of June, investors in gold-based index funds recorded serious losses, resulting in more than $1 billion in both funds being withdrawn. This was also the first quarterly outflow of funds from the gold funds since 2016.

The fall of the bitcoin and the other cryptocurrencies may be good news for the cryptomaniacs?

The depreciation of bitcoin and other cryptocurrencies may be good news for the cryptomaniacs. For example, the ripple is traded at levels not seen since the autumn of last year just before it erupts and increases its value 10 times. The question now is whether the ripple will be able to return quickly over the psychological limit of 30 cents, or its decline will continue.
Quite similar is the situation with the ethereum. The digital currency is at its lowest levels since April, after a peak of $1,400. From a technical point of view, the ether is in a strong downward trend after overcoming the lower limit of a narrowing triangle.
On its way down, the ethereum does not have many obstacles, and its decline may increase if we see a drop below the $300 psychological barrier that temporarily limits its depreciation.
A very serious decline was recorded by the bitcoin cash. It is traded at levels of about $570, and its decline may increase if we see a breakthrough in the key support level at $550 for a coin.

Ripple again under 30 cents

Remember the ripple mania at the end of last year? Then the cryptocurrency rose from 25 cents to 3 dollars. In just a few weeks.
Now things are the same again. The ripple has returned back to less than 30 cents. Will, however, it have the power to rise again at a similar pace? Hardly...
The record-breaking decline in cryptocurrencies continues. An exception to this negative trend is only the bitcoin, which is sustained at levels above $6,300.
The depreciation of the cryptocurrencies began after the US regulators refused to issue a permission for an index fund license based on the Winklevos brothers bitcoin.
The decline in the digital coin has intensified after US Bank Goldman Sachs commented that we can see a further decline in the bitcoin.
Later on, the fall of the cryptocurrencies accelerated after a massive wrong bet of $416 million in bitcoin futures that remained uncovered after the fall of the cryptocurrency.

R. Schiller: Investors to be careful with US Indexes!

One of the most respected economists and winner of the Nobel Prize for Economics, Robert Schiller, warned investors about US stocks.
Based on the cyclical cost-benefit ratio (CAPE), Schiller believes that US stocks are expensive. The index is calculated on the basis of the S&P 500 price divided by the average annual earnings of its components over the past 10 years.
According to some analysts, when this ratio is close to record values, similar to those of 1929 and 2000, the market is shrinking.
Currently, the CAPE ratio is close to 27x, which is well above the average of 15x and near its record highs.
The last time the ratio was at such high rates was a decade ago, followed by a substantial drop in stock prices, according to Oliver Jones and John Higgins of Capital Economics, in a letter to their clients.
Long-term investors must be warned, Schiller claims.
But Schiller recalls that this indicator is not very good at predicting market slumps. In other words, it is entirely possible that the index will continue to rise before it drops significantly.

Evans: One or two rate increases are absolutely reasonable

The US economy is performing "very well", with its continuing growth creating preconditions for one or two interest rates rises this year, according to Fed Chicago chief Charles Evans.
In an interview, Evans scattered fears of weaker inflation, which led analysts to forecast only one, or even none, raises in interest rates by the end of this year.
We may see one or two raises, Evans said. In December, Evans publicly opposed the rise in interest rates on the part of the Fed. Since then, we have seen two interest rates rises - one in April and one in June.
Evans, however, said the US economy was extremely strong, and its performance made him confident that inflation would hold or even cross the target of 2% while the unemployment rate would remain at its low levels. The growth of the world's largest economy is expected to range between 2.5% and 3% this and next year.

Oil with heavy losses

Oil has serious losses yesterday, following the escalation of US-China trade pressure.
China said they will not surrender and have imposed new import duties on US goods worth over 16 billion dollars. At the same time, Trump threatened to impose $200 billion in customs duties on goods.
This has triggered a drop in brent of over 3%, to below $72 a barrel, on international markets. Earlier today, the raw material recovered some of its loss by adding 30 cents to 72.50 dollars a barrel.
US crude added 20 cents to $67.10 a barrel after a loss of 3.2 percent yesterday. To a large extent, oil prices are supported by fears that Iran's new sanctions will lead to a decline in supply.
Investors' fears are that the US-China trade war will enter the final phase, and the stake for both sides will be "all or nothing". And this, in turn, would lead to a serious slowdown in the US economy.
China is the largest importer of crude oil in the world, with an average of 8.48 million barrels a day, 8.18 million barrels per day a year earlier and 8.36 million barrels in June.
The US energy agency said yesterday that oil reserves had fallen by about 1.4 million barrels last week. However, gasoline stocks surprisingly rose by 2.9 million barrels.

The bitcoin encounters serious difficulties, falls below 7000 dollars (2)

The risk-management team of the exchange immediately contacted the client, with the requirement to partially close the position to reduce the risks. The client, however, refused to cooperate, which triggered the decision to freeze client assets. Shortly thereafter, however, unfortunately the cost of the bitcoin dropped, which led to the liquidation of the account, the stock exchange said.
The stock exchange said they would redirect 2,500 bitcoins worth $18 million at current prices in an insurance fund to reduce the risk of such cases.
From OKEx, where their customers first agree to stock market conditions before they trade, they said they intend to make changes to their margin requirements after this.
The exchange, which is ranked 2nd amongst cryptocurrencies stock exchanges, against a commission, allows its clients to leverage 20 times the amount of their funds.
On Friday, the bitcoin, the biggest cryptocurrency, lost 2.2% of its value to a level of $7,383, bringing its weekly loss to 10%. Since the beginning of the year, the bitcoin has lost 48% of its value.

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The bitcoin encounters serious difficulties, falls below 7000 dollars (1)

A massive bad bet on bitcoin futures has led to a trader not being able to cover his long-term losses on the Hong Kong Stock Exchange. And that points to everything wrong with the trading of futures on cryptocurrencies, which many experts fear.
In a statement by the exchange on Friday, it is clear that the trader's stake is worth $416 million. The exchange liquidated the position on Tuesday but failed to collect the amounts due from the trader in the price drop. Because of the case and social rules, the stock exchange will force traders with unrealized gains to lose 18% of them.
The stock exchange said only that the troubled position was opened on July 31 at 2am.
This case comes to remind traders and investors of the risks associated with trading in unregulated or poorly regulated markets. Such cases are almost impossible to become a reality on regulated markets on which stocks and bonds are traded.
Cryptographic platforms are subject to hacker attacks, market manipulations, and more. Their weak regulation is largely the basis of the ability to manipulate the cost of the bitcoin and the other cryptocurrencies.

The dollar is rising, the metals are collapsing

Contrary to popular beliefs that the dollar is cheaper in times of trade wars, we are seeing the extraordinary strength of the US currency. Earlier this morning, the euro fell to 1.1560 against the dollar and is about to test the critical support at 1.1500. What will happen after this test will most likely depend on the medium-term movement of the single currency.
Otherwise, green money reached a 14-month high against the yuan. China urged a vengeance on Thursday if the US threatens to raise tariffs on exports of Asian-produced goods after US President Donald Trump instructed his trade officials to consider raising customs duties on imported Chinese goods from 10 to 25% of Chinese goods for $200 billion.
But as the US imports much more from China than China from the US, investors see the deployment of the trade war, causing worse trouble for the Chinese economy.
Serious problems due to the appreciation of the dollar have metals. Gold went down this morning near the psychological limit of $1,200 per ounce. Silver is traded at 16.20 dollars per ounce and platinum at $823.

Apple with capitalization over $1 trillion, growth for US indices

The big news of yesterday's day is the rise in Apple's market capitalization above the psychological limit of $1 trillion. The question now is, how long will the tech giant hold there.
The US indexes ended yesterday mainly on positive territory.
Best results, of course, had the technological Nasdaq. Driven by Apple's appreciation of 2.8%, the index added 1.2% to its value.
The broad S&P 500 added 0.5% to its value, while the blue chip index Dow Jones recorded a drop of 7 points.
The yield on 10-year US bonds declined again below 3%, although it remained extremely close - at 2.986%. Interest on long-term 30-year government bonds reached a level of 3.118%.

Nothing new from the Fed. How did the markets react?

Fully expected, the Fed kept the interest rate unchanged, with Powell emphasizing the good state of the US economy. This was taken as an impulse to preserve the policy rate of the interest rate reserve.
This negatively affected the US indices and sent the dollar upwards, initiating a decline in metals and raw materials.
The Dow Jones blue chip index lost 81 points, with its most lost components being the industrial Caterpillar and 3M lost 3.4 and 2.3%.
The broad S&P 500 declined by 0.1%, with the industry declining by more than 1%. The Nasdaq Technology reduced its value by 0.5%.
Global financial markets continue to focus on a US-led trade war, especially after the White House administration announced on Wednesday that President Donald Trump offered a higher 25 percent duty for Chinese goods totaling $200 billion.
The euro fell slightly by 0.1%, to 1.16505 dollars.

The Japanese central bank laid the foundation for the yen to fall

The Japanese yen is expected to depreciate against other major currencies, including the US dollar, after the country's central bank did not take action to curb its record monetary stimulus.
After the Japanese central bank meeting, Haruhiko Kuroda announced that the key interest rates in the country would be slightly increased, but did not mention anything about changing the monetary policy of the bank and record monetary stimulus.
Kuroda clearly said this morning that in an environment of continuing low inflation, the central bank has no intention of raising interest rates and will continue to maintain its incentives until targeted inflation is reached.
This largely disappointed investors and traders who were betting on a change in central bank policy. The yen, which had registered a significant growth against the dollar and the rest of the currencies, returned almost everything earned.
Earlier this morning, one dollar swapped at levels of about 112.00 yen.
Kuroda clearly said this morning that in an environment of continuing low inflation, the central bank has no intention of raising interest rates and will continue to maintain its incentives until targeted inflation is reached.

Oil ended July with an increase of between 6 and 7%

Speculation to find a solution in the Red Sea, as well as data on surging oil stocks, contributed to the decline in oil prices. We can recall that at the beginning of the week, the Brent almost reached the 75-dollar barrel again.
Concerns about the deepening US-China trade war, and the potential slowdown in Asia's economic growth, have led to a 30-cents loss for Brent up to $74 a barrel.
Losses of nearly 40 cents were also recorded by US crude oil futures. Together with the fall of Tuesday, the drop in oil is already close to 2%.
Yet, July was a good month for oil. In the seventh month of the year, Brent added 6% to its value, and US crude oil - nearly 7%.

Trump/Yen, Yen/Trump

The Central Bank of Japan apparently took seriously Trump's warning to its main trading partners - not to try to manipulate exchange rates.
According to well-known sources, the central bank of Japan is said to change its monetary policy. The explanation is - to make it more effective. Market participants, however, fear that its preparing for normalization is becoming a reality.
And this led to a fall of the Japanese Nikkei 225 by nearly 300 points and a serious appreciation of the yen. The dollar, which reached trading levels of 113 yen in the past week, traded at levels 111.18 on Tuesday evening.
Indeed, the dollar marked its largest decline against the main currencies for three weeks. The dollar index lost 0.8% of its value on Friday, with the loss of 1% against the yen, the US currency declining 0.7% against the euro.
The bond repurchase program was launched by the head of the Japanese bank in the distant 2013. The aim was to raise inflation.
Now, however, according to experts, the Japanese central bank has to make a lot of effort to persuade Trump's administration that it does not artificially lower the exchange rate of the yen against the dollar.
On the other hand, it appears that 2% inflation targeting the bank is an unattainable goal, even against the backdrop of serious monetary stimulus. Buying bonds, however, has led to an increase in government debt of over 40% over the past five years. At the same time, the goals of the Japanese central bank do not seem to be achieved. And this largely points to the ineffectiveness of the bank's policy.
Interest rates on 20-year Japanese government bonds also rose 6 basis points to 0.535 percent, moving away from their 18-month minimum at 0.475 percent earlier this month.
It has to be mentioned that the currency war is already a fact, as a continuation of the trade between the US and China. On Friday, President Donald Trump accused the major trading partners of the US of manipulating their exchange rates and thus receiving unfair competitive advantages.
We can recall that the trade war between the two leading economies started earlier this month, with the imposition of reciprocal duties on goods for $34 billion.

Strong growth in Europe and Asia after good results from Google

The US indexes ended yesterday's stock market upwards, prompting Asian and European markets to open on a plus today. The growth of European markets, however, was far stronger. The German DAX has risen to levels of trade of nearly 12,700 points, or an increase of over 1% compared to yesterday.
Opening on a positive territory is also shown by US index futures, with the S&P 500 trading at levels above 2,816 points.
To a large extent, the positive mood contributed to Google's results. The parent company, Alphabet, reported yesterday quarterly earnings of $32.66 billion, an increase of 26 percent and acceleration in the same quarter of last year. For comparison, revenue growth in the second quarter of 2017 was 21%.
After the results, the company's shares rose 5% and Alphabet's market capitalization was almost equal to Amazon's. For comparison, Amazon's market estimate is at $874 billion.
Still, Apple's shares remain closest to the boundary line. After good news about the company, its stock continued to rise and its capitalization is already close to 942 billion dollars. So Apple is only about 6% of reaching the coveted $1 trillion, which has not been achieved by any company in history.
So far, more than 17 percent of S&P 500 companies have announced their second-quarter results, with 82 percent of analysts expecting analysts to expect, according to FactSet. Wall Street has high expectations for this reporting season, with analysts forecasting an annual growth of 20%.

Oil is resuming its decline

After yesterday's recovery, the price of oil went down again today. Brent with delivery next month was traded at levels of $73.30 by noon. The risks of oversupply of raw materials have begun to dispel concerns about tensions between the United States and Iran.
Yesterday, the President of the United States addressed the Iranian president a serious threat to Twitter, which was repeated by other officials of the government. All of this, bent market participants, to the expectation of further oil supply problems. It rose to $74 a barrel, but failed to keep up on that level and began to fall again.
Saudi Arabia and large producers are increasing their yields to offset the losses likely to come as the deadline for imposing sanctions approaches.
Meanwhile, US pil reserves at the supply center in Cushing, Oklahoma, increased at the end of last week, retailers have reported, referring to information from the Genscape Market Research Agency.
In the last week of the month, however, inventories in the center are expected to drop, add traders. Further clarity on the state of supply is expected to be made tomorrow after the data on oil stocks in the world's largest economy.
The attention of market participants has moved away from escalating disputes over the impact of world trade on global economic growth and the demand for energy sources and raw materials.
Over the weekend, the G20 financial leaders voiced concern about the global economy's risk that may be the trade strain between the United States and China.

Bears rule: the market on Friday found no reason to rejoice

On the evening of Friday, the US dollar lost against the euro and let it grow. The main currency pair is above 1.1720. The risk for the euro is Italy with its political imbalance, besides some of the politicians again mention the possibility of the country's exit from the euro area - this is not the driver at which the single European currency can rise in price.
In oil, the "bulls" are trying to win back part of the weekly sales, but in the last couple of weeks, no one has gone up for black gold effectively. A barrel Brent opens the week with worth about $73.07, the resistance is at $73.50 and $73.75 respectively.
The gold closed last week near historically low levels, at a price of $1,233.60.

New ESMA regulations

ESMA (European Securities and Markets Authority) has negotiated measures related to the offering of CFDs and binary options to non-professional traders in the European Union (EU), and these include:

• Binary options - prohibiting the marketing, distribution or sale of binary options to non-professional clients;
• Contracts for Difference - Restricting the marketing, distribution or sale of CFDs to non-professional traders. 

The limitation includes: thresholds for the use of leverage when opening a position; a margin rule for closing positions; measures to protect against a negative balance on the account; preventing the use of commercial incentives by the CFD providers and a strict risk-specific warning through standardized formulation.
Arrangements for CFD and Forex Trading:

• The leverage thresholds for opening a position of non-professional traders are 30: 1 to 2: 1, this ratio varies according to the volatility of the underlying asset.
• Margin Rule for Closing Account Items. It determines the percentage margin (50% of the minimum required margin), whereby providers must cancel one or more open positions with CFDs to a non-professional client.

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Why was the dollar spared by the trade war? (2)

Last month, the ECB reaffirmed its non-aggressive policy, which helped renew the dollar's appreciation. The euro fell 0.7 percent against the dollar at the ECB meeting on June 14. Then the dollar rose the most against the euro in two years.
The outlook for the US economy is the best among developed economies, according to Marvin Loch, chief strategist at BNY Mellon. The Fed remains the most aggressive in its tone, compared to the other central banks around the world. Since the beginning of the year, the Reserve has raised the interest rate twice, and is expected to make two more hikes until the end of the year.
At the same time, the ECB is unlikely to raise interest rates by the end of the year, barely stopping the stimulus for that period.
In addition, credibility among bullish investors for the euro is diminishing as a result of the emerging trade war between the US and Europe. Experts point out that serious threats to foreign exchange markets may be an extraordinarily high short-term growth in the US economy, which would trigger a further strong appreciation of the US currency.
Investors continue to worry about the minimum slope in the interest rate curve, which continues to raise fears of an impending recession.

Why was the dollar spared by the trade war? (1)

The US dollar has so far been spared by the decline in other major currencies as a result of fears of a trade war between the US and China. Experts explain this, strange at first glance, with something very simple. Indeed, the trade war will not be good for the United States and the country's economy. Simply, it is expected to be much worse for US trading partners.
In this case of full force is the rule - "best among the bad ones". The rise in protectionism in the US, as a result of the US-China trade war, would generally hurt the US economy. So far, however, a mix of political events, fiscal stimulus, and concerns about bond market conditions can actually trigger a short-term rise in the US dollar.
Analysts from the ING investment bank explain the stability of the dollar with the "attachment" of the market participants to the US currency and the strong US economy compared to other developed economies. And as the currency pair with the best potential for growth of the US dollar, is the world's most traded one - EUR/USD, at least in the short term.

Oil fell after the US can resort to its reserves

US oil fell back below the psychological limit of $71 a barrel. This became reality after Saudi Arabia warned it would raise its output for two of its clients in Asia. In addition, the US has said it can turn to its strategic reserves to stop the rise in fuel and oil prices.
Oil futures in New York lost 0.8% of their value after falling by 3.8% last week.
With the price of oil reaching a three-year high in the past month, fears that the trade war between the US and China will hurt the price of "black gold" have become serious.
The renewed sanctions against Iran, as well as the declining production from Venezuela, were factors that compensated to a certain extent the depreciation of the oil price.
OPEC and its partners have agreed that they can resort to an increase of more than 1 million barrels of oil if needed.
US crude oil is trading early in the morning at $70.50 a barrel.
Brent with delivery in September traded at a level of 74.96 dollars per barrel.

The S&P 500 tested the key resistance level at 2,800 points

Big news for stock market investors. The US S&P 500, accounting for about half of the world stock market capitalization, overcame key psychological resistance.
According to technical analysts, if the index succeeds permanently to keep above that barrier, it may be heading for a test of its historic peak.
We can recall that since the index reached new record levels at nearly 3,000 points at the beginning of the year, followed by a sharp decline in February, it took over 10% of its value.
And now the question is - will we see a test at the top and will the indicator keep permanently above the 2,800 level?
If the S&P 500 fails to last above 2,800, its weakness can recover and we could witness its strong frustration. Quarterly reports by US companies for the second quarter will be published soon, also volatile August is expected, which has repeatedly proven that it can surprise investors very imprecisely.

Mark Mobius: The trade war is a prelude to the next financial crisis

The veteran investor, Mark Mobius, has one warning for investors who quickly forgot what happened in February with the indexes.
According to the expert, the trade war between the US and China is a precursor to the next financial crisis. Still, worst in US-China relations is ahead, in the light of the imposition of new tariffs on Chinese goods worth more than 200 billion dollars.
The worst is yet to come, commented Mobius in an interview with Bloomberg.
What does Mobius mean by "the worst"?
Mobius expects a further 10% decline in emerging markets and, ultimately, a financial crisis in the US and around the world.
According to him, tensions between the US and China will rise, with Trump not giving up on his plans to impose tariffs. Inflationary pressures will rise from wage growth in an environment of full employment in the world's largest economy, says the investment expert.
Good news, according to Mobius, is that damages to stock markets will eventually be a good opportunity to buy. He himself is currently raising his capital to take advantage of these potential opportunities in the future.

Oil lost nearly 7% yesterday, partially recovering today

Brent recovered partially from his strong losses yesterday. Today, the raw material added 1.3 dollars, or 1.8 percent, to $74.7 a barrel. US crude oil futures added just 42 cents, or 1.8 percent to $70.8.
The premium between Brent and US crude oil is still extremely small - just four dollars, against more than ten dollars just a few weeks ago.
Yesterday, "black gold" lost nearly 7 percent of its value as a result of continuing tensions in trade relations between the US and China. Yesterday, Trump threatened China with import duties on Chinese goods for about $200 billion.
Experts recall that we often see the compensation of some of the losses, with decreases with yesterday's magnitude. So the rise in raw materials today is not a big surprise.

The ECB is expected to raise rates sooner than forecasts

Eurozone bonds declined as market participants raised expectations that the ECB would raise interest rates earlier than expected.
German bonds led the cut, as the euro rose, after rising expectations that the ECB would raise rates well before December of next year.
Currently, at futures trading levels, the ECB is expected to raise interest rates by 82% by September of the following year. By comparison, until recently the expectations were only 70%.
Interest rates on five-year German bonds rose three basis points to a minus 0.26%, while those on 10-year bonds also added 3 basis points to 0.33%.

Turkish lira collapsed

Turkish President Recep Tayyip Erdogan initiated a turmoil for the Turkish lira again. This happened after two of his actions. First, Erdogan appointed his son-in-law as a new economy minister, and second, he would now determine who to be appointed as the head of the central bank of Turkey. At the same time, the governor's new term will be reduced to four years.
The Turkish lira lost 3.8 percent of its value against the US dollar, to a level of 4.74 pounds, and its loss since the beginning of the year is now more than 20 percent.
The document, which has the force of a law, also provides for the president to be the deputy governor, as well as the members of the Monetary Policy Committee, who will also have a four-year mandate, Reuters reports.

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Gold imports to India declined by 39%

India, the world's second-largest gold user, after China, reported a 39 percent drop in gold imports for the first five months of the year. The data are extremely disappointing and come at an extremely inappropriate time for gold.
The noble metal fails to find its way up, despite the trade war between the US and China, after the entry of reciprocal customs duties on goods worth over $30 billion.
The strong dollar also does not particularly support the price of gold to which the "yellow metal" is in a negative correlation. A traditionally strong dollar is associated with a weakness in the performance of gold.
Imports of India, which almost entirely fuel demand in the country, are considered a serious indicator of metal demand. This is something that gold traders are watching very closely.
The weak rupee since the beginning of the year, which makes gold relatively more expensive for Indian consumers, also largely determines the weak demand for the metal.

Asian indices fall given the tension between the US and China

Asian markets ended today's session on negative territory as a result of continuing tensions between the US and China. Chinese commodity duties are expected to enter July 6th on Friday, but the Chinese said they would advance with reciprocal duties, which, though again from July 6th, will become a reality 12 hours earlier due to the time difference.
Duties imposed are reciprocal, on US and Chinese goods worth $ 34 billion.
The Japanese benchmark Nikkei 225 lost 0.31% of its value to 21,717.04 points. Tokyo Electron shares fell by 4.28%.
In China, Shanghai Composite lost 1% of its value and closed at 2,759.13 points. In Hong Kong, HangSeng moved down 1.01% to 28,253.33 points.
On the stock exchange in Australia, the S & P / ASX 200 dropped 0.43 percent to 6,183.39 points. In South Korea, Kospi finished the session with a fall of 0.32% to 2 265.46 points.
Losses in Asia became reality after the fall in US indices yesterday. US markets ended the cut-off session on Tuesday on red because of downs in the technology sector. The Dow Jones industrial average index fell 0.54% to 24 174.82 points, with Apple shares falling by more than 1.5%. The broader S & P 500 ended with a fall of 0.49% to a level of 2,713.22 points.

Almost a record period of correction for US indices

US stocks are a few days away from a worrying event that will not delight all investors in these markets.
The Dow Jones and the S & P 500 are within a few days of reaching a key level. Be in the corrective phase during February 8th.
It was then that we witnessed the massive sell-offs that brought down the index by about 10% after new records were reached.
Rarely in history, after more serious adjustments of 10%, the indices move in such narrow ranges. Or the indices are in a narrow range of 10% already five months.
By Thursday, both indices - Dow and S & P are in an adjustment phase of 98 trading days. This is the longest such series since the financial crisis.
Then it was 108 days before the market came out of its correction phase.
In other words, if the two indexes remain in the adjustment phase for another 11 trading sessions by July 16, this will outperform this 2008 period and will be the longest similar period since 1984.
In 1984, the S & P 500's broad US index required 122 days to go through the adjustment phase, according to data from the WSJ Market Data Group.

D. Kostin: There will be a difficult second half of the year for the markets

US indices closed the first day of the new quarter slightly on positive territory. Investors, however, should not be granted much, because they may be in difficult months.
We can only recall that historically July and August are one of the most volatile months of the year. Remember what happened in August of 2016?
The number of financial experts who warn stock market investors to watch out for the second half of the year is rising. And one of them is David Kostin, the head of the Goldman Sachs Equity Investment Unit.
Kostin commented that, on the one hand, there is a serious geopolitical tension and, on the other hand, the Fed's rise in interest rates, from which they seem to be seriously worried about inflation.
In addition, Kostin predicts further interest rates on 10-year US government bonds rise, which should also cause problems for stock markets.
Of course, the situation is not entirely "black" according to Kostin. He believes companies with good balance, such as Facebook, will perform well in the second half of the year, even in an environment of further rising interest rates.

The trade war threatens the reserve status of the dollar

The danger of a trade war between the US and China is again on the agenda. And this may play a bad joke to the appreciation of the dollar against other major currencies, according to analysts.
Moreover, President Trump's protectionist policy threatens the status of the US dollar as the main reserve currency.
The US has already introduced steel and aluminum duty and threatens to do so with other Chinese and European goods. Meanwhile, the two parties concerned are expected to take reciprocal action.
The use of the dollar has long brought about serious risks for countries like China, as witnessed by turbulence caused in the country in 2009 by the financial crisis.
China Central Bank, again warned of avoiding the dollar in 2013.
Otherwise, history shows that in a trade war, the dollar has seen a serious depreciation against other major currencies.
In view of the current strong increase in green money over the rest of the major currencies, the time to shorten the dollar appears to be quite appropriate.

Eurozone with an inflation

Inflation in the eurozone has appeared. According to the latest data, inflation in euro countries, for the first time in more than a year, is above the ECB's target. At the same time, the main consumer price index is still growing at a slow pace.
Inflation in the euro area amounted to 2% yoy, against a background of 1.9% last month. Without taking into account volatile food and fuel prices, inflation in the euro area is 1%. This is a slowdown in last month growth, when the rise in the core CPI was 1.1%.
High oil prices are expected to continue to exert upward pressure on growth in euro area goods and services prices.
At the same time, the key consumer price index is expected to grow at an accelerated pace in the second half of the year.
Against the background of widespread wage increases in the euro area, investors and analysts do not expect any major surprises in the upward direction.
The euro initially rose against the dollar after data, adding 0.1% to its value to 1.1656 dollars. Subsequently, however, the single currency returned some of the earned, returning to levels below 1.1650.

80% of US companies with better-than-expected results

About 80 percent of the S&P 500 companies reported better-than-expected results for the first quarter of the year. Still, the index has fallen by 1.2 percent for the year to March, after investors are increasingly beginning to fear an upcoming recession for the US economy.
Volatility index VIX rose to 37 points, momentarily in February, after the sharp decline in the indexes in the second month of the year.
And although the broad US index has seen an increase or a decline of more than 1% only eight times in the past year, in 2018, movements over that figure were already registered for 35 days.
This poses the question to investors whether the 2019th year will end the second longest bullish market.
The US economy posted an increase of 2.2% in the first three months of this year, with inflation at the current US level.

SEC: The bitcoin and the ethereum are not securities

Whether the bitcoin and the ethereum are securities? One of the biggest questions in the crypto markets. Well, it already has a response from SEC officials.
At the San Francisco crypto conference yesterday, SEC Finance Director General William Hinman said the commission would not classify the ethereum or the bitcoin as securities.
This corresponds to recent comments by JJ Clayton, the head of the SEC, that the bitcoin and other cryptocurrencies are not classified under the definition of "security" and no changes will be made to that definition to be included.
Clayton also said that digital tokens are securities, but cryptocurrencies are not.

The ECB ends with incentives at the end of the year, the euro collapses

The ECB was fully expected to keep its short-term interest rates unchanged. What the bank surprised, however, from its meeting in Riga, was postponing the end of the bond repurchase program.
The bank hinted that "quantitative easing" or incentives would only end at the end of the year. The majority of market participants were counting on ending the stimulus in October or at the latest in November.
The European Central Bank will continue to buy eurobonds for €30 billion a month until September, as previously planned.
From next October, however, purchases are expected to be halved - up to 15 billion euros, but on the assumption that economic data confirms the 2% inflation forecast by the financial institution.
Overall, the results of the Bank's meeting were accepted by market participants as too weakly aggressive, not meeting market expectations before. Investors reacted violently by selling the euro against the dollar. The single currency fell to trading levels at about 1.1630 late at night, or about 2% below its price yesterday.

Trump: OPEC is guilty of high oil prices

US President Donald Trump has made another accusation. This time, he blamed OPEC for high oil and fuel prices. And no doubt, most Americans probably think the same way.
Oil has risen more than twice since the beginning of 2016, after reaching levels of less than $30 at that time. And to date, US consumers are facing the highest fuel prices at petrol stations in 2014.
On Wednesday, the price of a gallon of normal fuel was at an average of 2.91 dollars, or an increase of 25%, a year earlier, according to AAA data.
The price of oil is too high, OPEC is behind that. It's not good, tweeted Donald Trump on Wednesday morning.

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Bad news from Germany continue

Bad news related to the German economy just can not stop. The latter were related to industrial production and went out today. Industrial production in Europe's largest economy has seen a surprise decline in April.
Against the backdrop of the projected 0.3% rise, the indicator fell 1%.
These figures, coupled with the downgrade in factory orders in Germany earlier this week, indicate the potential problems the German economy may face.
Industrial production in the second largest European economy - the French one - also fell in April.
The euro fell after bad data from Germany and France, losing 0.2% of its value to 1.1772 against the dollar. Yesterday the single currency traded at levels above the psychological limit of 1.1800.
Other data from the eurozone also indicate a slowdown in the growth of the European economy. This may well be a factor in the ECB's next week's decision and postpone the announcement of the end-of-term of incentives from the European Central Bank.

The Fed will most likely raise interest rates despite emerging markets

Emerging markets, which are facing serious difficulties because of the Fed's interest rate increase, are not expected to gain sympathy from the federal reserve.
Developing countries' currencies were severely affected by sales due to investors' fears that their economies would not cope with higher US interest rates. This has prompted the central banks of India and Indonesia to call the Fed for careful action while Brazil warned of challenging times.
However, there are not many signs that the problems of emerging markets will change the policy of the Fed. Analysts are expecting at least two more interest rises this year, except for almost full-rate interest rates next week.

Nasdaq Composite with a new historic record on Monday

The Nasdaq Composite tech index rose yesterday to levels above its highest historic closing. The benchmark was traded at 7,600 points or above its highest closing level of 7,588.32 points.
It should be borne in mind that the highest value reached in the index was momentary at 7 637.27 points on March 13 this year.
The rise in the technology index, as well as the other US indices, has become a reality in a context of lowering political tensions in Europe and declining the dollar.
The Dow Jones Industrial Average rose 174.7 points, or 0.71 percent to 24,809.91 points, while the S&P 500 added only 8.01 points, or 0.29 percent to 2,742.63 points.
The MSCI Global Monetary Index rose 0.54%. European indexes added 0.22% to their value.

Poloniex stopped trading and withdrawals until customers updated their information

The Poloniex LLC Cryptocurrency Exchange stopped the trade and withdrawals until its customers upload new documents required for account verification.
This has led to serious concerns among a large number of Boston-based cryptocurrency customers that they will not be able to withdraw their funds.
In a tweet in the social network, the cryptographic exchange owned by Goldman Sachs said that the funds will be secure and available at any time after filling in the required documents for accounts verification, Bloomberg writes.
This, however, did not completely reassure all customers who asked what would happen to the funds of those who failed to verify themselves?
In a post on May 27, in their website, Poloniex said that as all registered businesses operating with funds, Poloniex are subject to regulation and must abide by the laws.

223,000 new jobs in the US and unemployment of 3.8%

Employment data in the world's largest economy proved to be well above the average expectations of analysts. 223,000 new jobs were reported by the Ministry of Labor at an unemployment rate of 3.8%.
This was the lowest level of pre-crisis unemployment.
The result exceeded the analysts' average expectations of a 3.9% unemployment rate and 190,000 new jobs.
Better than expected was the rise in US workers' pay. Wage growth was 0.3% per month and 2.7% yoy.
The average hourly wage was expected to be 0.2% per month and 2.6% on an annual basis.
The rise in pay is perfectly logical, given the low unemployment rate and the accelerated pace of job growth, according to market observers.

Time to buy VIX? (2)

Why is VIX perfect?

Because the index is traditionally moving in the opposite direction of the US indices. But, unlike them, its downward potential is limited to about 10, or just below that limit - about 20 percent of its current levels.
Unlike six months ago, however, when US indices suffered from total lack of volatility and traded only at new and new record values, the unthinkable happened and volatility erupted, bringing this index to levels over 30 for a moment.
After a long recovery of indices, the indicator returned again to its lowest values. But the danger of a new eruption is much greater than half a year ago.
Or, the index can easily and quickly double, and why not, even tripling its value, with limited potential for decline. Or a yield-risk ratio of 5 - 20% drop, versus 100% growth.

Time to buy VIX? (1)

What's happening on US stock markets can be described as extremely dynamic and dramatic. But, as they say, we've already seen something like that before. Two times. And just before a drastic drop in US indices by more than 40 percent. Yes, I recall 2000 and 2007.
And while it does not necessarily have to end the same way - with crisis and crash (although it is possible, given that it has already passed 10 years since the last crisis), at least we can enter the "bearish cycle" - that is, a decrease in indices of more than 20%.


How?

The scenarios of the events in above mentioned two years, and then witnessing a fall in the index of more than 40%, seemed this way:
Reporting a historical record => Correction between 8 and 13% for about four weeks => Upward test for the next three or four months => Unsuccessful breakthrough or minimal false break at the top => Direction down to test the lowest value of the correction => And finally break down when breakthrough at the stated lowest value. Does it seem familiar to you?
If you think that a similar scenario can be formed at the moment, you can trade it with the VIX.
And the moment of his purchase is "ripening" again. Because the volatility index is again starting to look like an "asymmetric investment" - one with a limited drop potential and unlimited growth.

Italy is diving in a deeper political crisis (2)

Overall, the bond market in the euro area has become chaotic after the published documents.
In fact, Italy's debt problem is becoming more and more obvious. The country's debt to GDP is at the expense of 132%. And by adding to this size the much larger size of Italy than Greece, what could be the consequences for the EU?
For comparison, the debt of Greece, which was saved by its European partners, amounts to 180.8%.
According to Italian publications, two of the top populist parties, following the inconclusive results of the March elections, intend to ask the ECB for a 250 billion-euro debt relief program.
According to the 39-page document, there is also a possibility to look for a way out of the eurozone. This is a proposal the two parties have made in the past.
Following the publication of the report, the two populist parties have said that this is an old version that has been seriously modified. Particular attention was paid to the part leaving the eurozone, saying that the single currency is not in doubt at the moment.

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Italy is diving in a deeper political crisis (1)

The inability to form a government in Italy after the leaders of the populist parties have withdrawn leads to the country's entry into a deepening political crisis.
The Five Star leader has said he is considering an impeachment proposal for President Sergio Matarela, while anti-immigrant party leader Mateo Salvini has hinted at a conspiracy and a call for new elections.
Meanwhile, the euro has depreciated against the dollar, in an environment of increasing political uncertainty in Europe.
More and more analysts are concerned that the next financial crisis in Europe may begin in Italy.
The two populist parties have already hinted that they would want to alleviate conditions from Europe, the country's overwhelming debt.
The latest attack on United Europe has become a reality in Italy. Huffington Post Italia prints a government offer in mid-May, according to which populist parties in the country are planning to ask the ECB for debt relief of 250 billion euros.
After the report, interest rates on 10-year Italian bonds reached their highest levels in two months. Interest on government bonds and other euro area countries rose, with Greek 10-year bonds rising by 25 basis points.