Watch Out. It’s selling alert.
The markets are slowly but continuously falling since yesterday where the Wall Street is going down as the top levels were not retained – neither in the Dow Jones index nor in the SP 500 index.
The S&P 500 index made a top of 1811 on Friday after which it started falling and is trading at 1793 level before the start of the U.S. session here on Tuesday. The continuous fall in 2 days may be the result of the analysts’ expectations regarding the slump in the market that may come any time due to the bubble. In fact, some renowned economists and investors are also predicting such downfall in the stock market which they are categorizing as the cause of the bubble in the housing market and the technology sector.
Both these sectors, according to them, are getting overvalued and are having exaggerated value that may not be sustainable in the long-run hence the bubble may get burst if effective control mechanisms are not taken to control such flow of money in the market.
Gold investors – Hopeless
The investors are strongly bearish on the metal for the past few months as gold has broken its 1242 support level and is trading at 1221.73 after testing the 1218 area on Monday. The uplifting of sanctions or should we say the ‘relaxation’ in the sanctions on Iran has caused the optimism to grow among the traders / exporters of oil due to which the supply side has increased, causing the prices of oil and gold to fall.
However, the outlook for gold cannot be generalized right now for long-term or at least for the medium term, especially at this point where the year is about to end and still no decision came out regarding the tapering of the stimulus plan.
The non-farm payrolls and the unemployment rate data for the U.S. are up next on Friday, and can certainly give a good boost to the metal where bulls might enter the market and take it at least above the 1250 level.
To contact the reporter of this story: Jonathan Millet at firstname.lastname@example.org