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DW Wealth Snippet 22 May 2021 vol.697
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This Week Highlight - Impending Risk Rising in Eurozone
On 22 April, European Central Bank (ECB) head Christine Lagarde said the economy is still “on crutches” and in need of support from both the central bank and government spending. The rising threats of covid-19 has engulfed the slowdown among 19 countries in Euro bloc as extended lockdowns implemented.
Lagarde said that policymakers in the Eurozone see an eventual rebound before year-end but did not discuss any reduction in its emergency stimulus.
The ECB left interest rate benchmarks untouched at minus 0.5 percent while made no adjustments to its EUR1.85 trillion (est USD2.22 trillion) in bond purchase stimulus that will run through March 2022.
On 19 May, ECB Vice President Luis de Guindo said there could be a financial risk coming forth in Eurozone as the region might need more stimulus. Till now, the pandemic has hit different economic sectors with varying degrees of severity and speed, with tourism and hospitability among the most impacted.
Policymakers are particularly concerned about a higher corporate debt burden in countries with larger service sectors because this could increase pressure on governments and lenders in these nations. Guindo asked for caution as the central bank expects a possible increase in insolvencies in 2021.
The ECB fears that the situation moving into 2021 will see bank profitability remains weak while prospects for lending demand are uncertain. Bank asset quality has been preserved so far, but credit risk may enlarge with a lag, implying a need for increased loan loss provisions.
While sovereign debt and corporate debt financing instruments are ballooning in wake of the pandemic crisis, it will be a worry if the Eurozone can manage its economic recovery amid the growing deficits in all sectors. In the event of the interest normalizing to taper the deficits, we foresee the equity market and asset bubble will rupture.
If you think Y2021 is a tough year, then we suppose Y2022 will be the greatest challenge to many business owners and entrepreneurs. Hedging into safe haven will begin now in order to safeguard your hard-earned fund.
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The U.S. stimulus worth USD1.9 Trillion has been approved by the House and waiting to be signed into law by President Biden. Target timeline to complete the signatory on the dotted line is today, 14 March 2021. That also means President Biden has to execute his pen power in order to continue the issuance of unemployment benefits to low-income Americans after the expiry date. Last week, Dow Jones market clocked the historical fresh high again on Wednesday when it closed at 32,297 points. The worries on inflation pressure as an eye-washer to long traders have become a bear-trap. Sometime back, we have mentioned in this snippet on the ironical sarcasm of inflation in U.S. economy while so many Americans are cash-strapped due to loss of jobs. Since we are expecting the U.S. stimulus to be rolled out in March, the expanse of this public fund will be able to last for estimate 5-6 months. Practically, we expect the inflation will build up at strongest level sometime in mid-April to end
Hello everyone. It’s a bit late to do analysis for trading today. Here is my analysis support and resistant guide for your. FUTU support level is 123 now. Please take note. It must close above 126, then, you can continue to hold. Otherwise, your sell some profit first. To average down your cost. Once the price breakdown 123, will look for the support at 116. If the price breakup 126 and we can continue to hold. I will give your future resistant. TESLA for short trade, it went to above 600 and drop again. It still look’s good. If not breakdown to 550 again. We still look for TESLA sideway between 550~600 for the next 3 to 5 trading days. APPLE, no matter how still at the normal price range movement. Support at 122, resistant at 128. I dont think it breakdown 120 yet. Still can hold for long term. NIO looks went to 34.9 and drop again. If it hit 32 and not breakdown, it can hold for long term. It look’s good for NIO. Dont need to worry too much. Anyway, market movement we cant predic
After the price movement and Q1 2021 Financial report, FUTU Just hit above 130 yesterday premarket. So, I provide 120 as support level. Because the prive movement, the market support level is up. Once breakdown 124, i suggest take profit first. 130 still today’s resistant. Once can stay above 130, we look for next higher resisant at 140.If the price breakdown below 120, please do not buy as low first. Next support level at 112. Good Luck.