Are Global Indices Overbought?

with Peter Esho April 6, 2014

This week is expected to be very, very busy for markets. We’re already

seeing an increase in volatility on Asian markets very early on Monday.

This was prompted by the US non-farm payroll numbers coming out

slightly below expectations, but a big revision for the prior months.

Expectations are starting to build out there in the US bond market that

interest rates may perhaps have to start rising over the next few years and

so this week's FOMC meeting minutes will be very, very closely watched.

It really will be a turning point for markets.

The Dow Jones Industrial Average is coming from its all-time high. We

actually think that the US market is set for a decline somewhere in the

order of about five or ten percent, perhaps over the next four to six weeks.

That’s a key market that we’ll be watching. It’s a key market that we've

been recently discussing at our morning meetings. We’ll be updating the

Invast blog following those FOMC meeting minutes with technical levels.

It's also a week where we’ll have a look into the Japanese markets. We

have the BOJ meeting very early on during the week.

The Japanese market, the Nikke,i is also under pressure. There is

perhaps somewhere in the order of about four to five percent downside on

the Nikkei. We've been updating that in our live market analysis which run

every Wednesday and also on our blog.

In Invast Insights this week, we update our portfolios. All 3 portfolios are in

positive territory. We’ve made some new decisions in terms of where to

invest in our wealth creation portfolio. We've added some new small cap

stocks in there, which we think will do well over the next few years. We

also have a look at the Australian dollar given last week's Reserve Bank of

Australia meeting minutes. More importantly, this week's jobs numbers

which are a key event --- we’ll update that at the live markets analysis on

Wednesday, but its something that you should put down in your trading

calendar if you’re trading the Aussie dollar. We’ve reviewed that in Invast

Insights as I’ve said.

With all that in mind very early on, building out towards the end of the

week, we end the week with Chinese data around inflation which the

market will watch very, very closely. The market is also watching for any

signs of Chinese stimulus coming into the market. That has been absent

over the past few weeks. We're starting to see metals like copper again,

reverse their recent upward trend and so that'll be a major theme this

week.

Plenty going on. Make sure you check out the Invast blog on a daily basis.

Again, register into that live market analysis, and if you haven't already

signed up for a full week free trial into our Invast Insights, it's well worth

doing.