It has been both a difficult and at the same time a positive year for the stock market and its traders. We have seen 3 major dips so far this year in the market, but simultaneously we saw long lasting and steady bullish trends, which pleases all traders. All traders have different risk appetites and therefore, search for stocks with different characteristics or elements. For example, traders may search for stocks with specific levels of volatility, trends, cost, or even in a specific industry such as technology or banking.
The blog will leave the choosing of the stock to you and your own analysis, but hopefully we can provide you with useful information to assist you with your analysis.
Why has the Stock Market been gaining in such Hard Times?
A Lot of traders have been asking why the stock market has been extremely bullish during 2020. The market sentiment this year has been extremely poor when looking at “high risk assets” such as Oil and the US Dollar, but yet the stock market has been appreciating at paste.
What a lot of traders do not know is that the Stock Market and the US Dollar can, at times, be inversely correlated. Market correlation is a statistical or observational factor that identifies a positive or negative link between the pricing of specific assets. These relationships are used to determine the direction and relative strength of evolving price action. However, traders should note that these links are not certain not guaranteed to have the same effect each time.
When the US Dollar is under pressure and finding strong resistance, traders try to find an alternative investment in order to avoid their capital depreciating with the collapsing Dollar. A very well known correlation is Gold, which is also known as a Safe Haven. The same principle applies to the stock market, which is an alternative to Gold, Silver and other Safe Havens.
Latest developments in the United States of America
Investors are focused on the possible end of the uncertainty surrounding the presidential election and the appointment of a new treasurer in Joe Biden’s team. Yesterday, the current US President Donald Trump ordered the General Services Administration (GSA) to begin transferring power to Joe Biden, although he did not recognize his victory in the election. Investors see this as an approaching end to political instability.
They were also encouraged by Biden’s choice of Janet Yellen as the new US Treasury Secretary. Observers believe that the former head of the Fed will remain committed to the principles of stimulating the economy and will do her best to fight unemployment and high levels of debt. Previously, it was assumed that Biden may prefer a less market-friendly figure, for example, Senator Elizabeth Warren, who is in favor of tightening regulation of the banking system.
During the day, investors wait for the release of November data on the Consumer Confidence Index. The indicator is expected to decline from 100.9 to 98.0 points, which will put additional pressure on the USD.
The Latest from the Stock Market
Over the last 24 hours one of the leading US indices, the Nasdaq, continues moving within an uptrend, trading at $12,102. The asset can be used as an overall indication of the market sentiment alongside that of the US stock market alongside the SNP500 and the DowJones.
The SNP and Dowjones have also recorded steady growth over the past 3 days. This morning the price has slightly decreased over the past 6 hours, which may have been caused due to the previous strong resistance levels formed on the 9th and 16th November.
Stock indices around the world are rallying after reports from several pharmaceutical companies about successful trials of COVID-19 vaccines. Yesterday, AstraZeneca also announced successful trials of its vaccine with 70% to 90% efficacy.
Amid positive news that vaccinations could begin as early as mid-December, stocks in the travel and transportation sectors are rising. Thus, the papers of the cruise operator Carnival Corp. rose by 4.66%, while shares of United Airlines Holdings rose by 2.89%. Tesla’s quotes also continue to grow actively. After it was announced about its imminent inclusion in the calculation of the S&P 500 Index, the rate rose by 6.58%.
Seattle Genetics (–3.08%), Verisk (–3.06%), Apple (–2.97%), and Netflix (–2.38%) are among the decline leaders. Align (+6.75%), Tesla (+6.58%), Carnival Corp. (+4.66%), and Micron (+4.53%) grew the most.
Traders have over 160 assets on the platform which they can choose to trade. It is recommendable for traders to research and analyse the asset as well as a chart, in order to choose the stock which fits your investment requirements.
Disclaimer: This material is considered a marketing communication and does not contain, and should not be construed as containing investing advice or a recommendation, or an offer of or solicitation for any transactions in financial instruments or a guarantee or a prediction of future performance. Past performance is not a guarantee of or prediction of future performance.
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