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ZFX: Fears returned? Another wave of correction - Zeal Capital Market

ZFX: Fears returned? Another wave of correction

24-09-2020 09:05

The Asia-Pacific stock markets generally closed lower on Thursday, following an overnight drop on Wall Street. Stepping to the European trading session, the bearish momentum maintains, as the US index futures were just “ups and downs”, without any good signs.

Analysis warned that, the trends of the three major Wall Street indexes were all technically bearish. Risk-off sentiment may continue, leading further price losses.

ZFX analyst Jacob Leung said that we should question whether the uptrend of the “tech stocks” is finished or not. Any rebalancing of the portfolio may cause substantial correction, and the three major indexes have dropped below the 50-days MA so that greater selling pressure is predictable.

These day, coronavirus pandemic developments are the hot topics, weighing on investor sentiment. The dollar is strengthening against most of the major currencies amid risk aversion. Investors are worried the return of the lockdown measures, which will slow down the economic recovery. The worries have sparked another wave of the adjustment in the financial markets, especially under such unclear direction.

ZFX analyst Jacob Leung said that, we know that somehow “no news is bad news”. There are numbers of reasons for the market adjustments, based on how to review those different interpretations, like the recent comments from Fed members, the global economic data performance, resurgence of the pandemic, vaccine developments, and all the international conflicts and tensions. Meanwhile, it is implied that the financial markets have no direction at all. The uncertainties could drive the investors to reassess to hold “cash” as a best strategy so far. As mentioned recently, a higher dollar is unfavorable to the market sentiment, if “Cash is King” is valid. As expected, the markets may be continually “risk-off” until new bullish prop coming.

Risk Warning: The above content is for reference only, and does not represent ZFX’s position. ZFX does not assume any form of loss caused by any trading operations carried out in accordance with this article. Please be firm in your thinking and do the corresponding risk control.