Geopolitical tensions | 01 April 2022

Geopolitical tensions


#SP500:


U.S. equity funds witnessed big inflows in the week to March 25. U.S. investors purchased equity funds of $13.88 billion. U.S. large-cap funds attracted $9.39 billion in net buying after facing outflows of $2.5 billion in the previous week, mid-cap funds received $98 million, and small caps saw outflows of $440 million. U.S. growth funds regained inflows, amounting $3.38 billion after six consecutive weeks of outflows, while value funds faced small outflows of $82 million after purchases of $1.41 billion in the previous week. This is a positive signal for the stock market.


Trading recommendation: buy 4500 and take profit 4580.


Geopolitical tensions


XAUUSD:


The U.S. Federal Reserve is also tightening its monetary policy, hiking its interest rate to 0.5% in its latest policy decision handed down during the previous week. The central bank’s policymakers also hinted at a more aggressive approach to curb inflation. Yields on the U.S. 10-year Treasury note also remained close to their 2019 highs. This is a negative signal for the precious metal. Geopolitical tensions in Eastern Europe will have a positive impact on the value of gold.


Trading recommendation: range 1910 -1990.


Geopolitical tensions


#WTI:


Crude prices rose, as investors reconciled the impact of a missile attack on an oil distribution facility in Saudi Arabia with a possible release of oil reserves by the United States. Yemen's Houthis said they launched attacks on Saudi energy facilities on Friday and the Saudi-led coalition said Aramco fuel distribution station in Jeddah had been targeted by an attack. The Iran-aligned Houthi movement that has been battling a coalition led by Saudi Arabia for seven years launched missiles on Aramco's facilities in Jeddah and drones at Ras Tanura and Rabigh refineries. With global stockpiles at their lowest since 2014, the market remained vulnerable to any supply shock.


Trading recommendation: buy 105.50 and take profit 113.44

 

David Johnson
Analyst of «FreshForex» company
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