Technically Speaking: The Drums Of Trade War – Part Deux

Technically Speaking: The Drums Of Trade War - Part Deux

Summary The concern currently is that while the 200-dma is critical to warding off a deeper decline, the escalation of the "trade war" is going to advance the timing of a recession and bear market. As we have been writing for the last couple of weeks, the risks to the market have risen markedly as we head into the summer months. China understands that Trump’s biggest weakness is the economy and the stock market. This fight will be to the last man standing, and while Trump may win the battle, it is quite likely that "investors will lose the war." This idea was discussed in more depth with members of my private investing community, Real Investment Advice PRO . In June of 2018, as the initial rounds of the "Trade War" were heating up, I wrote: "Next week, the Trump Administration will announce $50 billion in ‘tariffs’ on Chinese products. The trade war remains a risk to the markets in the short-term. " Of course, 2018 turned out to be a volatile year for investors which ended in the sell-off into Christmas Eve. As we have been writing for the last couple of weeks , the risks to the market have risen markedly as we head into the summer months. "It is a rare occasion when the markets don’t have a significant intra-year correction. But it is a rarer event not to have a correction in a year where extreme deviations from long-term moving averages occur early in the […]

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