Tradepedia’s Founder & CEO Mr. Avramis Despotis on ReLive Le FontiTVPosted on Tuesday, January 22 2019 at 11:11 am GMT+0000
discussing Market Outlook 2019, China GDP data, Chinese tech sector, Brexit developments and FTSE 100 and EU equity markets outlooks
FTSE and GBPUSD:
In UK we are walking into uncharted territory, no one knows what is really happening, there seems to be some positive news from what I’ve been listening around that the peer of no-deal seems to be taking over Europe or might be willing to compromise on the Irish border story, so for example the polish foreign minister said that the Irish issue could be solved if the backstop was time-limited to five years. So you see that there is something starting to change and Europe have to be afraid of a no-deal scenario, so they might be willing to compromise and we might see compromise in the days and weeks to come which of course is going to be converting to a nice rally in the stock market. However, I just believe that this is going to be a fair market rally, it’s going to be relief rally that will take us a bit higher to then start a long-term Bearish market. So I don’t believe the short can have the opportunity to enter yet, but the general direction of the market is strongly Bearish. The rally that we saw since the beginning of the year was totally anticipated, the markets were oversold they reached important support levels, so the rally was welcomed and will give us the opportunity to sell at a higher level. Of course the market now, let’s say the Asian market have corrected a little because the GDP of China which was at the lowest level in 28 years, so I think it’s technically dragging the world stock markets, since it’s showing there is a slowdown in China and this is worrying world stock market and the economies everywhere.
There seems to be a positive momentum, so I would expect the market rally in the sterling and the FTSE and the stock market to continue higher because it seems that they’re going to be maybe a compromise between the UK and EU so they will try for another compromise and this is what is helping the rally, but is going to be temporary of course, let’s not forget especially in the European markets like DAX which is my favorite market to short you know economies especially in Europe are not doing that well I mean Industrial production in Italy, Spain and Germany went negative in November and also GDPs in Italy Germany were going down in November.
ECB’s meeting expectations:
You know the ECB is a bit more slow to react so I’m not sure that we are going to see any reaction this coming week, if we do it would be a surprise but then again I think since the economies are not doing well in all around Europe so they have to act I’m not sure that they are going to do it fast enough.
Growth in China:
If China managed to find a solution with the US in the trade war, so they negotiate a trade agreement, tariffs lifted, China cannot get access and plan down on those intellectual property, all these things are technically going to help the growth in China but then again I think it’s very hard to maintain these levels since the trend is clearly down in the growth in China. I’m not that rosy but you know we are a global economy now, so with Europe going to recession it’s also bad for China and we have the Oil which is not that high so this affect the consumption in the middle-east which in turn affect China.