I went back after a week and would like to take an overview of the financial markets and add my trading schedule that I am following.
There seems to be a return to normality, the numbers say so with the Dax flying for the first time to 15000, the S&P 500 makes new all-time highs as if the covid pandemic had not affected the financial economy.
Sentiment is positive in the markets, the PMI index in Europe continues to rise so everything would seem to be regular, world governments continue to issue debts, container ship blocked Suez Canal and fortunately a few days ago the egyptians unblocked the situation.
Despite this, Suez Channel event, world stock markets did not find the problem last Friday, I would remind my readers that 12/13% of world trade between Europe and Asia passes through Suez. The next few weeks will tell whether or not shipping companies will increase shipping costs without calculating that we are in a global emergency situation.
I think financial markets are completely disconnected from the real economy, I don’t believe all this positive sentiment but I think about how many people lost or will lose their jobs between 2020 and 2021.
Have you seen Bill Hwang’s Archegos Capital Management fund?
This character in 2012 got involved in an inside trading case, my question is : how is it possible that the SEC can give license people who defraud in financial markets?
Goldaman Sachs and Morgan Stanley (particularly the former) are the brokers of Archegos Capital and given the highly speculative positions of the fund they asked for the “margin call”.
20 billion dollars (perhaps much more) causing the 26/3/2021 collapse of some titles such as Baidu, Tencent, Vipshop, Iqiyi and Viacom. What do brokers do in these cases? Simple, Goldman Sachs calls the risk manager of the Archegos Capital Management fund and asks to rebalance the positions. Fund is obliged to sell securities in the portfolio to cover the margin call, but it will be necessary to check if the sales have been absorbed by the market, we will see this situation in the near future.
For all lovers of speculative funds, in 2020 and 2021 more than 200 funds failed, the media do not always tell everything even so as not to alarm savers but this is the truth on the financial markets. This is the result of speculative finance with the systematic use of derivative instruments such as options and since March 2020 from the mass participation of retail traders who have pushed stocks such as Gamestop, Tesla etc… to rise without particular economic fundamentals.
I add the hidden hand of central banks that at every negative event instead of having the financial markets correct, they inject billions of dollars by artificially supporting them.
When mechanical doping ends, what happens? What risks do savers take? How can they defend themselves?
S&P 500 Futures (4027.25) 3:45 pm 02/04/2021
Disclaimer: What I write is not a solicitation of trading but my idea of what I’m going to do on the financial markets. All my analyses are done through platform with speed and pressure indicators
Long: 4032.25 to 4038 first target
4038 to 4052 second target
Short: 4025.25 to 4014.25
4014 to 4000
3897 to 3973
3963 to 3949
14 points have their own meaning, each has its own strategy and money management. I remember that it is not a advice to invest your savings, the risk appetite of each of us is different.
Happy Easter traders
