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Home / Analytics / Forex analysis & forecasts / Market Overview / Morning Call. Market Overview for 31.08.2016
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Morning Call. Market Overview for 31.08.2016

31.08.2016

The Big Picture:

The DAX on convinced Monday, rising ca.1%. Amongst hedge funds a type darwinian selection is starting to take place. During the course of July, 25 Billion USD were withdrawn from hedge funds, many of them performing badly over the year. Adding to weak performance, there are management fees. Hedge funds usually charge a fee of 2% and take 20% of profits. Amongst hedge funds the top 25 have earned 13 Billion USD in 2016. There are 8000 hedge funds worldwide, 100 of these having closed last year. I total this sector manages 2700 Billion USD. Due to the profit share model, many managers invest in only a few stocks. If these stock perform well, managers profit immensely. Ons of these stocks was Valeant Pharmaceutical, having quadrupled over the last years and being a favorite of many managers.  Since August of last year, Valeant has lost 80% of its value. Bill Ackmann, a star in the industry, has lost over 1 Billion USD with this stock. Instead of limiting losses, lower prices were happily bought to average down. This is not an individual case, so it is of no shock that investors are pulling out.
 

DAX

The DAX is in an upward trend. Next resistance is seen at 10860, support at 10500.



 

Euro / USD

The Euro is trading sideways in a large trend. Support is at 1,0822, resistance at 1,1429. Short term the Euro is in a downward trend.



 

JPY / USD

The Yen is in an upward trend



 

Gold

Gold mid term, is now trending upwards, short term we are seeing a sideways move. The next major resistance is at 1375, support at 1300. Gold is showing some very short term weakness.
 


 

WTI Oil

Oil is trending upwards.




Overnight:

Walls Street traded moderately weaker on Tuesday. Future US monetary policy remaining the dominant focus. Consumer confidence in the US came in stronger than expected. This lead to interest rate concerns and falling stocks. In addition the technology sector was put under pressure by the European-Commission´s tax demand against Apple, which as a index heavyweight put pressure on the Nasdaq 100. In Asia the Nikkei 225 rose 0.925 on the back of the weaker Yen against the USD. Australia and Hong Kong trended lower. After yesterday´s strong gains, profit taking was seen in the USD. WTI Oil trades unchanged.
 

Today´s numbers (CET)

  • 08:00 Germany: German Retail Sales
  • 09:55 Germany: Unemployment Change
  • 14:15 USA: ADP Nonfarm Employment
  • 15:45 USA: Chicago Purchasing Managers
  • 16:00 USA: Pending Home Sales
  • 16:30 USA: Crude Oil Inventories
 

Company news :

  • USA: Quarterly Earnings: No data expected.


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Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex bears no responsibility for trading results based on trading recommendations described in these analytical reviews.