Theres a huge disconnect between the financial economy (stock markets) & the real economy (jobs, GDP etc), this disconnect is apparent throughout the world's major economies. These disconnects cannot exist forever, so eventfully either the stock markets in the world will fall to reflect the major unemployment and real economic problems left by the pandemic OR we will see all the economic readings improve to pre pandemic levels or higher to meet the performance of the financial markets.
in probability terms, its going to be much more likely that the financial markets fall to better reflect the current economic struggles. Where this is most likely to happen first is in Europe as most if not all major European countries are seeing daily virus cases rise past previous levels set in the first wave, many countries already have or are currently considering additional lockdown restrictions to curb these rising virus numbers.
This is why I have chosen the GERMANY30 to express this trade idea and place my short.
in probability terms, its going to be much more likely that the financial markets fall to better reflect the current economic struggles. Where this is most likely to happen first is in Europe as most if not all major European countries are seeing daily virus cases rise past previous levels set in the first wave, many countries already have or are currently considering additional lockdown restrictions to curb these rising virus numbers.
This is why I have chosen the GERMANY30 to express this trade idea and place my short.
Comment:
Shorts running well... Could be looking at a superb entry.
Comment:
We have made some good money on this trade and it seems the momentum has dissipated from the move at the moment.
Usually for a bearish trade this is a bad sign, typically markets sell quickly and rise slowly. (TIP) This is why the VIX, that simply measures volatility rises on bearish moves and falls on bullish moves.
Usually for a bearish trade this is a bad sign, typically markets sell quickly and rise slowly. (TIP) This is why the VIX, that simply measures volatility rises on bearish moves and falls on bullish moves.