(MENAFN – DailyFX) Trade War Talking Points:
The enthusiasm for the US-Mexico deal to avert tariffs has diminished as Trump’s account at odds with counterparts As the US President looks to muster support for his aggressive position with China, a shift of focus back to currencies The Dow ended its longest climb since May 2018 and regaining traction may be difficult without fundamental encouragement Do you trade on fundamental themes or event risk? See whatlive events we will cover on DailyFXahead (including the ECB rate decision and NFPs) as well as our regular webinar series meant to help you hone your trading.
The US-Mexico Trade War Breakthrough Lost its Luster Quickly Even though there were a number of questions and inconsistencies to following the early weekend news of a US-Mexico trade deal to avert a blanket 5 percent tariff on all Mexican imports into its peer’s borders, the news would still put wind to the market’s back. How much of that run was hold over momentum from the previous week and what percentage was fresh enthusiasm owing to a needed break in the oppressive trade wars? Well, we would see much of the lift that kicked off this week vanish through the full term of this past session’s trade. After putting in for yet another bullish gap on the open, the Dow andS & P 500would eventually lose all the altitude mustered through the morning and eventually close the day in the red. For the blue-chip index, that is thefirst lower close in seven trading sessions- bringing a close to the longest charge for bulls since May 14, 2018. While these are not the only benchmarks from which we can evaluate the general mood of the speculative rank, their momentum and proximity to record highs exerts considerably greater weight.