Month: March 2020

British Pound (GBP) Latest: GBP/USD Stabilizes, Outlook Improves

Following the recent news of a slight increase in the current account deficit, the British Pound (GBP) is currently trading against a strengthened US Dollar (USD). This has led to speculations that the GBP might depreciate as it may not be able to maintain its previous valuation if the US Dollar continues to strengthen.

Of course this is not a particular perspective which we can gain for you but it can be compared with the forecast of the economic impact and how the recent global financial crisis will impact upon the economic growth and development. All major currencies are linked and they are affected by each other. If for example the UK were to experience an increase in trade with China, the economy would grow but so would the price level.

There are several economic indicators to check on and most of them are pointing towards better growth. We can look at the output figures, we can look at consumer confidence, we can look at employment figures and many more. The strength of the global economy is even being backed up by the International Monetary Fund (IMF) who have been stating that the economic outlook is looking very bright.

In addition to this, the strong demand and supply balance of the international market mean that there is an increasing opportunity for businesses and investors to take advantage of the low-interest rates and liquidity conditions which exist. Some countries have done very well through this crisis and some have fared poorly and some countries which suffered the most have recovered very quickly and had massive growth in their export markets.

Amongst the major countries that have seen a boost in growth are the United States, United Kingdom, Japan, Italy, Germany and Ireland. However, even among these countries, many are still trying to find the optimum form of stimulus. Given the current situation, it seems unlikely that any additional stimulus from the major central banks will be forthcoming anytime soon.

The British Pound (GBP) has been one of the best performing major currencies against the USD (as shown in the previous graph). The rise in the demand for Sterling has also been matched by the strengthening USD.

One of the reasons why the British Pound (GBP) has performed well against the USD is the strong performance of the Euro. For example, during the Global Financial Crisis, the Euro appreciated against the USD whereas the British Pound suffered steep falls. But even after all this depreciation, the GBP continued to recover and is now up over 2% since the onset of the financial crisis.

Another benefit of trading the British Pound (GBP) against the USD is that the currency has strong support from the European Central Bank (ECB). There are a number of reasons why the ECB decided to support the GBP. First of all, it has been seen that an appreciation of the GBP may have implications for their own exports and therefore if their exports are depreciated, it may have a negative impact on their balance of payments.

Another reason why the ECB is supporting the Euro is that it has seen that countries which have entered into fiscal austerity programmes may not have the capacity to do so in the future. This has prompted the ECB to protect the value of the Euro by allowing for a rise in the UK Pound's value. In order words, the Euro and the British Pound are both up.

Finally, as discussed above, the global economic crisis has increased consumer confidence around the world. Therefore, the global demand for goods, commodities and services is on the rise.

The British Pound (GBP) is on a strong upward trend and as a result, we can expect to see a further upward move on a monthly basis. It is possible that a new high may be achieved and this is very much dependent on the economic scenario in each country.

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S&P 500 Price Outlook: Index Tests Trendline Extremes in Bear Market

So you've heard that the S&P 500 price outlook indicates an upcoming bear market. You want to do something to protect your investment, but don't know what. In this article I'll go over some of the indicators you can use to spot a bear market and what you can do to ensure your financial security.

It's relatively easy to spot a bear market because all you have to do is compare the direction of the trend line of the S&P with the direction of the trendline of the prior and previous five market cycles (the average length of a bear market). If the current trend line appears to have edged downward and the previous ones had consistently turned upward, then the price will likely continue to tumble.

What exactly does it mean when the price index of the S&P 500 gets lower during the bear market? Let's take a look at four of the most important things you should be watching for.

First, if the trendline of the S&P gets lower and the previous one was stronger than it is today, then that means that the S&P 500 is likely to drop in the coming weeks. The index has usually either dropped sharply or steadily for several years before the bear market period. This should tell you that there's a chance that the current price might fall even further than it is now.

Second, another sign that the index is heading for a low is when there are several bears that seem to have aligned themselves around a trendline that has lowered since the last cycle. For example, you'll see several bulls that seem to have aligned around the trendline of the S&P when the index falls below two hundred and fifty points. This is usually a sign that there's going to be a bear market. Third, the trendline of the S&P Index appears to have curved downward during several years and shows no signs of stopping this time. Usually, the previous cycle ended with the index at two hundred and fifty points. Since the price index has been trending downward, you can expect that it will continue to do so, which suggests that the prices of the stocks will be lower.

Fourth, the index recently fell sharply during the past three years and the future market prices for the stocks haven't been any different from what they were before. After all, in the previous five market cycles, the S&P Index rose consistently and the future prices didn't differ much from the past five cycles. Since the future market prices have been lower, then that would suggest that the future prices for the stocks won't be any different.

Even though these four indicators can help you to spot a bear market and to take action to protect your portfolio, it's also very important to understand the definition of a bear market and how it differs from a bull market. There's a good explanation for this difference in this article.

In order to keep your money safe during a bear market, it's best to invest only part of your portfolio in the index itself. Instead, concentrate on the small cap stocks and gold. Using your small cap stocks to protect the remaining portion of your portfolio from being wiped out in a bear market is a good way to avoid a wipe out in a bear market as well.

Most people think that they can just rely on the price of the index to tell them when to buy and sell. But this approach will usually backfire and cause the investors to lose more money than they can afford to lose.

To determine when the next bull market is about to occur, you need to understand how the index behaves during a bull market. It tends to follow a trend line, but that doesn't mean it stays on a trend.

The reason this is so important is because of the nature of the stock market. A bull market often lasts longer than a bear market and can be just as volatile, if not more so, so that a bear market.

Gold Prices Drop Despite Coronavirus Scare, ECB in Focus

Gold prices plummeted when the news of the Coronavirus scare spread, as a result the price of gold dropped. As the market continued to drop, a number of economic analysts raised their concerns regarding the declining price.

Many in the financial community believe that gold prices will continue to drop, as more people are becoming aware of the Coronavirus. One thing they are concerned about is that consumers will abandon gold altogether. If consumers see the value of gold dropping, it could cause a dramatic decline in the value of the dollar.

This is particularly alarming, since in recent years, gold has only gained value and is currently one of the strongest holdings against the dollar, the strongest currently. The price of gold, and its reserves, has been steadily rising in recent years. It will be interesting to see how long the Coronavirus scare lasts, or if it will cause consumers to start selling gold instead of spending it.

Meanwhile, interest rates on money are dropping all over the world. When interest rates fall, prices of any type of asset rise. This is due to the fact that the amount of money available for loans and credit will increase.

In the past, as interest rates have risen, prices of assets have declined. The Fed's efforts to prop up the market have done nothing to help the economy. If there was something to fear, it should have been the interest rates, not the Coronavirus scare.

The global recession has set in, and the dollar has continued to weaken. Gold prices are down by about 60% since 2020. That is a big decline in a relatively short period of time.

With the economy in the doldrums, and interest rates dropping, the value of paper assets continues to rise. That's because the amount of paper assets will increase.

With paper assets increasing, the dollar will continue to weaken. More countries will be forced to give in to currency crises, and that will hurt the United States' image worldwide. This makes the problems of the global recession even worse.

The Coronavirus scare, and falling gold prices, may be a sign that the global recession has been delayed for another year or two. It is possible that the financial institutions are holding off on injecting liquidity into the market, which could end up hurting the stock market, and finally lift interest rates back up.

They may also try to tighten monetary policy, so as to maintain the confidence of central banks around the world. Gold will eventually recover, but only after central banks get serious about helping the economy. When that happens, gold prices will begin to climb again.

It is possible that gold prices will stabilize, and that we will be back in a recession within a year or two. It is also possible that gold prices will rise, as citizens demand the US dollar to strengthen, and the world falls back into recession.

The value of gold prices will vary from month to month, depending on whether the US economy is strong or weak. As long as there is an economic crisis, it is possible that gold prices will rise again.

EUR/USD to Face Larger Pullback as RSI Falls Back from Overbought Zone

As the EUR/USD trades through the recent range, the charts show it is likely to retrace along a horizontal line from its highs before the divergence, perhaps to a high of EUR 1.2790, although it is not a very strong support level. The EUR/USD has been trading to highs that are below the swing high on the previous Friday.

The EUR/USD has crossed the resistance at the low of the trade range from this high, with other consolidation levels also tested again. But there is a question as to whether the break of this resistance zone is sufficient for the upper-elevation support set by yesterday's high will last. Because, if the current range continues to be widened beyond the weak area of the mid-month highs, the EUR/USD may again become a long-term overbought.

At this point, the EUR/USD is in an extension of the trade range, however, it will probably have crossed the technical levels from the recent highs. The charts indicate the range has been extended by a few points and is now contained in the high-risk area.

And since EUR/USD has entered a more aggressive extended trading range, it is possible that the upper-elevation resistance has fallen. It is possible that this area is now no longer solid enough to sustain the bullish momentum created by the EUR/USD as it pushes higher in the charts.

The EUR/USD has been on a trading path that has been above the swing high and this trading range has been tested as it has moved beyond the weak economic data. The charts are not certain as to whether the wedge formed at the high-trend line will continue or whether the EUR/USD may fail to absorb any additional growth.

The technical analysis points to the potential for reversal within the extended trade range. Trading above the wedge created by the daily low-point and high-point of yesterday's high could bring about further gains and could move the range in a slightly stronger direction than the recent price action has shown.

It appears that the resistance zone may have fallen or the EUR/USD is moving lower when the technicals show a sideways channel forming and this channel has become tightened. This may have encouraged the breakdown of the wedge in the market.

The channel has probably expanded a little and has passed the line formed at the high-trend line, which confirms that the trade range has been broken. In addition, the trade channel has narrowed but it may have opened a little wider in order to allow the weaker economic data to continue to act as support.

This means that the trade range may be open a little wider and this is a new entry point for the EUR/USD. But a new entry point may well be triggered by a slightly lower barrier than the recent highs and lower than the weakness previously found in the channel, perhaps even approaching the strength of the recent resistance, such as seen earlier in the week.

These may be the conditions that a resistance level may be established for the recovery and the trade range may be continued once again. With the prices being higher than they were yesterday, and the trend line in the channel more open than it was, then the bullish psychology may remain intact and could actually provide further gains.

The bullishness and the failure of economic data in the United States to give some support to this sentiment factors that drove the EUR/USD lower and now we see a short-term reaction of the same factors and the decline in the price. However, the market may pick up once again in a day or two, perhaps given more time to digest the economic data.

The break of the strength of the resistance in the channel has allowed some entry points for the breakout of the range of the EUR/USD. Once this is achieved, then the EUR/USD will begin to move higher and may go beyond the trade range formed in the channel, opening up a new trade area in the mid-week.