News background & trading ideas for 19/03/2019

19 มี.ค. 2019

News about the stock market and the oil market. We already wrote last week about the problems of Boeing. So far, they continue to get worse. According to the Minister of Transport of Ethiopia, the flight analysis showed a lot of similar details with the disaster in October. Therefore, markets reacted negatively to this news.

Despite of a decline in the Boeing quotations, what is happening is fully within the pattern of reaction to negative force majeure: a fall in value of an asset in 1-2 weeks. Recall that the next phase of this pattern is the return of prices to its normal level (before the occurrence of force majeure). This usually takes at 2-3 weeks. So, if you have the patience to stay in the position for about a month, we recommend in real time testing the testing of the force majeure pattern.

You can buy Boeing shares from current prices with a gradual averaging during the week (if the shares continue to fall). Goals - closing the gap on the daily chart. As for the reason for the upward price reversal, it has already been voiced - the cause of the problem is solved by changes in the software. The patch is already developed, it remains to implement it. So a reversal can happen at any time.

Germany's two biggest banks are in talks about a merger is another important news. As a result, a financial monster may appear.
Brexit. This week, Theresa May has postponed the final vote on her Brexit deal. We were quite skeptical about the idea of hers, because the previous votes did not just fail, but failed with a crash. Our skepticism was justified by yesterday's news. Speaker of the House of Commons John Bercow has banned the British Prime Minister to return the version of the agreement on Brexit to re-vote without any changes. That is, Teresa May will have to go to Brussels and ask for a postponement (the trip is scheduled for Thursday).

Of course, if she fails her mission, the pound will not be in a great shape. But it is rather a force majeure scenario. The most likely is granting a delay. So, we are still positive about the pound and recommend its buying.

The data on the labor market in the UK. Given that the pound has recently been actively responding to the news background, you can try to trade on the news. As an option, prior to the release of data, place stop orders for both buying and selling in the 15-20 points from the ongoing price at that time.

The meeting of the OPEC+ monitoring committee in Baku. According to the committee, the level of compliance with the terms of the transaction was about 90%. At the same time in March they plan to exceed 100%. In general, this is a bullish signal, but there is one significant "but." Recall that before the expiration of the OPEC + No. 2 transaction there is not much time left. So far, there is no unity and clarity on the issue of contract renewal. So, you need to follow the news about the extension of the contract. Otherwise, “bears” may well seize the initiative in the oil market. But until that happens, we continue to recommend buying oil on the intraday basis.

We buy gold, sell the dollar, the Russian ruble and the Japanese yen.