Expert opinion

This summer I wrote an article about the suggestion of stalking the small cap stocks Russel 2000 Index (1). Just like a cat stalks its prey looking for the best possible moment to pounce, so a trader can stalk an entry to get the best price for entry.

The reason was because on this Index it is present a not so common pattern: the “orthodox broadening formation” (2). This kind of pattern was present also on the Dow Jones Industrial Index, but it was luckily negated (3).

Last week we had a potential and positive sign that also on this Index the pattern could be negated. We have several signs of strength, but we are still in the early stages of potential medium-term growth.

Latest reports revealed that the Consumer Price Index for July remained at about the same level it was seen back in June, when it was reported to have increased 1.2% y/y/. Is it reasonable to expect a higher inflation in the next quarter?

Yes, we do see inflation in Canada grinding higher in the next 3-6 months, though it is going to be a slow track up to the bank’s 2% target. Some of the weaknesses has occurred due to temporary factors that are likely going to reverse to some extent in the nearest future. At this point, we continue to believe that the economy is operating at a relatively high level and that the growth will create modest inflation pressure.

Finlantern’s Fiscal Forum, at its fourth edition, once again created an environment where enterpreneurs and investors were able to meet new potential clients, and in general create networking opportunities, but also learn the benefits of internationalization, and meet tax advisors.

There are several markets across the broader emerging market (EM) world that offer yield – India is no different in that sense – but very few match Indian bonds for their high yield and low volatility characteristics.

In January, I wrote an article about the situation of the Stoxx 600 Index, indicating that it had a good strength and that some pattern studies suggested that the Index could lead to a probable formation of a higher low before to start a new uptrend leg (1). In reality the retracement begun later: the bullish short term trend easily crossed the down trend line (b), the resistance level of the previous 2015 high, situated at Fibonacci level of 23,6% (a), and topped in May with an higher high (H1). Then we had a retracement that apparently stopped at the 38.2% Fibonacci level, forming the aforementioned higher low (L1). The oscillator also turned upward after touching the zero line (c).

In result of combination of technical factors and fundamental events, the currency pair made a turn around and broke though the bottom boundary of a previously dominant ascending channel.

From technical point of view, the rate encountered a resistance level formed by the monthly R2 at 112.54 and the upper boundary of a long-term falling wedge.

The last Newsletter ended with a suggestion that US marines might soon be setting foot in Venezuela. The fact is that America has been spending a lot of money financing the opposition in this oil-rich country and has been fomenting regime change as a matter of course. The reason for this policy is not only hate for Hugo Chavez and his successor Maduro but rather the huge oil reserves that Venezuela has, which are the largest in the entire world.

Tensions have risen sharply on the Korean peninsula this year, as North Korea (NK) has accelerated the pace of rocket launches and has conducted its sixth nuclear test. In response, the United Nations has adopted its strongest sanctions yet, but the fault lines remain.