Trade wars remain one of the major threats to economic and financial stability. Things will not improve unless there is some breakthrough. UN warns of massive implications for East Asia if the US raises tariffs on Chinese goods from 10% to 25%. It is going to lose about 160 bln in GDP.
Today, Trump is to give his State of the Union address. The impact on the market is expected to be minimal.
Dow Jones 30
The Dow Jones Industrial Average has been growing since December. It has recently passed the 200MA and set its sights on 26 000. As soon as it has been growing for quite some time, there should be a correction. However, the current momentum favors growth. It’s no use to go short until there is a strong break in the bull run.
The crude oil market will remain a bull one if the asset continues to set higher and lower highs like it was doing last month. To open a long position, one should wait until the price returns to the lower trend line. A breakout and a drop below 51 would make the chart bearish.
Gold is consolidating not far from the support level. The 1310.05 mark is the beginning of the support area. The growth is likely to continue if the price does not move downwards far from this zone. The key level to watch is around 1298.00.