I hung back from trading on Friday because I have seldom ever got it right on payrolls day. And I am glad I did, as the jobs number was poor and the markets got hammered. Since then, the European crisis has taken another turn for the worse, with political deadlock in Greece, a Spanish banking bailout on the cards and an economic fantasist on his way to the Elysée Palace.
With so many of the indices having plunged below key levels, I have to start looking for shorts once more. I think the best opportunities are likely to come outside the US, where equities have already been weak. I am hoping to short either the DAX or the FTSE if the chance presents itself today.
Click here for analysis of some leading equity indices.
The next round of money-printing is one step closer, in my view. And this goes not only for the US – where weak jobs growth will ultimately require a third round of quantitative easing – but also for the Eurozone. If the single currency project is to survive in its current form – or even in a reduced form – the ECB is going to have to do exactly as its peers elsewhere have done and print. The prospect of further monetary debauchment has yet to feed into a stronger gold or silver price, but there is plenty of time for that to happen. In the meantime, I look for further weakness in these metals, although nothing too dramatic for now.
Click here for analysis of some leading commodities.
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Dominic Picarda is a Chartered Market Technician and has co-ordinated the IC's trading coverage since 2006. He is a regular speaker at trading and investment events and also holds the Chartered Financial Analyst qualification.