https://thegoldandoilguy.com/wp-content/uploads/2019/09/41.png 548 850 admin http://www.thegoldandoilguy.com/wp-content/uploads/2014/11/tgaoglogo.png admin2019-09-02 16:48:422019-09-02 16:48:42Could Hong Kong Disrupt China & The Global Markets Further?
Reading the news this weekend and watching the chaos in Hong Kong, one has to wonder how this violence and disruption in commerce is really affecting the Asian and global markets. Many different news sources are already reporting that Chinese economic data continues to show weakness over the past 4 to 5+ months. Additionally, Hong Kong, being a strategic source of income and business for the western world, has been disrupted with riots, protests and not violence as a result of a political battle between Chinese rulers and local Hong Kong residents. It seems obvious to anyone outside of this situation that neither side is about to stop their actions any time soon and that means we are going to experience even further disruptions to the global markets and local markets. Right now, our greatest concern is that the disruption in economic activity in China/Asia will result in a “cold” in the US and other foreign markets. Our August 19th call for a potential US market breakdown was stalled because of recent news that China and the US would begin talks again attempting to resolve the trade issues. Yet, we know these talks may last many months with no real progress in terms of lifting tariffs or real concrete outcomes. We don’t believe the US is going to remove tariffs or ease up on trade-related factors until we see real progress made by China. This would suggest we are in for a long-haul in terms of real relief in the markets. Our research team still stands behind our August 19th breakdown call. Our super-cycle research suggests that the US and global markets are poised for a price breakdown and we believe the recent news events have stalled this price move. Particularly, we point to the nearly -1100 point price drop on August 22 through 26, just days before the news that China was willing to engage in new talks with the US about trade. This move would have likely continued to break lower, as we predicted, had the Chinese not announced their intent to try to relieve pressures on the economy and the global economy. Before we get into more details, be sure to opt-in to our Free Market Forecast and Trade Ideas Newsletter We may have to give the Chinese credit for moving the markets by simply making an announcement that they were “willing” to engage in talks at a critical time when a price breakdown appeared to be executing. That one statement changed the way the markets perceived the future. Global traders rotated to a perspective of “hey – maybe the Chinese are finally going to negotiate a solution”. We believe this is a stall tactic while the Chinese attempt to work another angle to protect their markets/assets.