S&P 500 has obstacles on its way | 11 декабря 2015

Forecast 7 - 11 of December:

XAU/USD:

In the first half of the week we should expect continuation of the corrective movement to the psychological level of 1100/1115 per ounce. After the index basket of the dollar set a multi-year highs at around 100.58, investors began to partially close long positions, which in turn led to correction of the US currency and positively impacted on the stock of the precious metal. However, the outlook for gold is still negative. Firstly, OPEC, as expected, did not reduce production quotas. On the other hand, some members of the cartel were in favor of increasing the quota to the level of 31.5 mln. barrels per day, which corresponds to the current state of affairs. Oil contracts took this event negatively and trading week on Brent and WTI closed on the lower level - decline was more than 3.5%. The second player in the global oil market - Russia - the last week reported an increase in production in November by 140 thousand barrels to 10.78 million barrels per day, which will also have a negative impact on the stock of the & ldquo; black gold & rdquo ;. In this connection, it is now quite difficult to count on growth of inflation expectations in the G-7 countries, which is a negative factor for gold. Secondly, on 16 December FED with high probability will go raise the interest rate, which in turn will enourage demand in the US dollar and cause an outflow of capital from the commodity market. Market participants understand that and will not build up long positions with XAU/USD, on the contrary, growth of quotations will be used to open short positions. So, the week we expect flat trend within the range 1065 - 1115.

XPT/USD and XPD/USD:

The platinum group metals demonstrate growth of quotations, but news background is now clearly against them. See yourself: PMI indexes for the manufacturing sector of the US and China published last week were below 50%, indicating decline in the industry of the two leading world economies. And if the figure in China has been below the key level for nine months in row, the US ISM got there for the first time for three years. This trend is a negative factor for industrial metals. However, against the background correction of the US dollar in the foreign exchange market, in the first half of the week both metals will be in demand and can demonstrate growth to the psychological level of 900 XPT/USD and 600 for XPD/USD. On the threshold of coming tightening of the monetary policy by the US Federal Reserve we should not count a greater growth of quotations. So, this week we should open Buy positions with XPT/USD on drop to 870/860 and take profit on 898 and open Buy positions with XPD/USD on drop to 560/550 and take profit on 595.

S&P500:

US stock market is hard enough to move up, because now there are practically no drivers to update historic highs. Published releases from the ISM manufacturing and services sectors have disappointed investors. The industrial index dropped below 50% for the first time in the last 36 months, which is a consequence of the revaluation of the US dollar and stagnation of oil and gas sectors which is caused by lower prices on hydrocarbons. Over the past eleven months, the dollar index basket (USDX) rose by 8.2% and in the last five days it has established a new multi-year highs at around 100.58. Starting from the second half of 2014, growth of the US currency was 22.2%. The negative trade balance in the first ten months of this year amounted to 440.04 bln. US dollars, which is by 4% more than for the same period in 2014. On the one hand, the trend for the American economy is not something to be concerned about too much. At first glance it may seem that corporations adjust their work to the & ldquo; strong dollar & rdquo ; environment. However, the quarterly reporting of majority of companies tells about the opposite: in the second and third quarters of this year, there was a decline in revenue and net profit associated with the high rate of national currency. In my opinion, a strong negative effect will be witnessed by us in 2016, when growth rate of the trade deficit will increase. You can not ignore increase in the yield of two-year treasury bonds, which signals the coming raise of the FED interest rate and thus does not add optimism to investors in the stock market. So, this week we should open Sell positions with S&P500 on growth to 2101/2111 and take profit on 2045.