Typically, there is an inverse correlation between the value of the dollar and that of gold. When the dollar loses purchasing power, then the value of other currencies increases and so the demand for commodities. The investors look for alternatives to protect value: gold, a typical safe haven, is a preferred choice.

Not always the inverse relationship is true. There have been times when both assets have risen or fallen together. Many factors drive the U.S. dollar’s trends, like monetary policy, U.S. inflation, economic prospects. Nevertheless, the correlation coefficient calculated between the returns of the U.S. Dollar Index and the price of gold sticks, most of the times, around negative values.

We expect some consolidation into August for Equities. Indeed, Risk/Reward seems momentarily stretched on the S&P500 Index, while the EuroStoxx 600 could be eying a second leg down into August. Following that, these trends should resume up possibly from late August / early September into October.

The first person who introduced the concept of “stalking” in investing was Van Tharp when he described his Ten Tasks of Trading. One of these tasks was: “stalking your trade”. 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.

Biotechnology is defined as the use of living systems and organisms to develop or make products, or "any technological application that uses biological systems, living organisms, or derivatives thereof, to make or modify products or processes for specific use" (UN Convention on Biological Diversity). The recent dramatic improvements and progresses in research and achievements in this sector reveal a considerable potential for the improvement of the quality of life but also for the creation of economic value. Therefore, biotech can be considered as key industry for the century.

The STOXX Supersector Europe 600 Banks Index, has been in the last ten years, the worst performer index among he 19 European Supersectors group. Since January 2007 it had performed -63,23%.

In the last ten years this Supersector developed three intermediate uptrends, and the las one started one year ago. Looking to the weekly chart from 2006, we can note a first short but strong uptrend in 2009 (1), a second longer uptrend in the period 2012-2015 (2), and a last one started in mid 2016 (3).

Since reflation trades topped out between December and February, Cyclical sectors and Financials have underperformed. During this period, growth stocks and especially Big Technology have widely outperformed, followed by Consumer Discretionary, also a growth sector, as well as Defensive sectors (Staples, Healthcare, Utilities). We believe that these rotations should reverse during the Summer, as Growth and Defensives handover to Financials and Cyclical and give life to a second leg up for reflation assets towards early 2018.

An important step was moved the last week towards the integration of the Chinese economy within the financial world. The index giant MSCI has finally decided to include, next year, 222 China mainland stocks to its emerging markets index. The proposal had been rejected three times in the recent years.

It’s a big decision since MSCI controls the benchmarks of the most heavily owned exchange-traded funds worldwide, an asset class that is more and more relevant in the global financial world.

Technically speaking, the US 30 years government bond yields curve, from a long term point of view, is still in a bear market. But looking on a short and medium term basis, we must consider some elements to understand if prices could be in a retracement phase of a potential short term rising trend.

First of all, the 30 years Treasury curve, the week that Trump was elected, advanced with the most highly percent daily change in 30 years (1). The price broke the medium term downtrendline (2) but was not able to overcome the previous high around 3,25 of June 2015 (3).