Market overview for 12.11-16.11.18
Almost all markets are full of tension now. Concerns about the US economy slowdown have a negative impact on the stock market, which keeps falling down gradually. The problems in Italy and Great Britain hold DAX quotes and EUR quotes at the record low level. The oil is becoming cheaper. But the world’s markets volatility plays into the hands of gold, which has demonstrated some strong growth over the week.
1. Oil market
Despite expectations that quotes, which broke “70” level, will return to the range of USD 70-72 from Monday, the Brent oil’s futures have declined even lower. After a small Monday’s increase, the price returned to the level of “65.10”, and has won some part of its losses only by the end of the week.
Analysts place the blame for the oil market collapse with the United States of America, believing that the market-influencing factors have long ago moved beyond its limits. Primary concerns about the oil shortage after the implementation of the sanctions against Iran weren’t that serious. And, trying to smooth their consequences, The United States of America together with OPEC has put on the market too much of the “black gold”. The pressure that the Unites States of America puts on Saudi Arabia with a views to increase the production level, resulted in a political stand-off that has made investors to switch to more stable assets.
Current week forecast: Goldman Sachs analysts do not exclude that the price will go lower than USD 65 due to the world’s demand collapse and due to the refusal of OPEC to decrease the oil production. The information about a steady demand will on the contrary increase the price to the level of USD 72-75, and this is a more probable scenario.
2. Stock market
The US stock indexes were demonstrating some small volatility for all week, but went in the red by the end of the week. There were no fundamental drivers during this week, so indexes continued their inertial decline of previous periods. Indexes of Asia and Europe also demonstrate negative trend.
Current week forecast: It is steadily negative. Despite the fact that, in the context of the publication of statistics and reports, the next week is going to be calm, the market still has some tension. The overvalued securities will continue the retracement, so it is better not to hurry with the investments in the stock market.
3. Cryptocurrency market
The middle of the week has brought some unexpected changes to the cryptocurrency market. The US dollar that has been continuing its flat in the range of BUSD 200-220, has abruptly been interrupted by a sharp collapse. In a matter of a few hours on Wednesday, the market capitalization declined down to BUSD 180-182, which caused a full-scale panic among investors.
The hard-fork of BTC (scheduled for November 15) was supposed to become one of the most remarkable events of the previous week. The internal conflict of developers resulted in the division of ВСН into two independent branches, and, according to some analysts, this event may become a cause of the whole market’s drawdown. The point is that, in this case, it is not clear why investors were withdrawing their money from all cryptocurrencies: despite the fact that ВТС has been devalued down to USD 5 500(- USD 700 per one week), its share in total capitalization remained at the level of 53%.
Current week forecast: It is negative. The price of ВТС has declined below the cost of its mining, which will slow down the miners’ work. Since the market demonstrates some unpredictability, investors will hardly be in a hurry to open long positions, locking in profits. It is quite possible that the capitalizations may fall down to 160 billion US dollars by the end of the next week.