Interesting Market News and Views from Global Financial Markets-13

1) What’s really important about China’s stock market disaster, and what’s not

From www.washingtonpost.com - Today, 9:45 AM

What you need to know about the latest decline in China.

2) Gold near 7-week high as stocks retreat | Intra...

From www.scoop.it - Today, 9:44 AM

Gold traded near a seven-week high on Thursday as investors channelled money into the safe-haven metal amid a global stock market rout, worries over the Chinese economy and heightened geopolitical tensions.

3) Fears for world economy wreak carnage on stocks and oil

From www.dailymail.co.uk - Today, 9:39 AM

World stock markets tumbled and oil plumbed new lows Thursday as investors feared for the global economy on signs of a dramatic slowdown in powerhouse China....

4) Loonie sinks to lowest level in 12 years as Canadian oil price drops to record low

From www.cbc.ca - Today, 9:39 AM

The Canadian dollar hit its lowest level in more than 12 years as the main Canadian oil blend dropped to a record low price and stock markets tumbled.

5) Chinese stock market plunges again: For how much longer can China hold back the tide?

From www.telegraph.co.uk - Today, 9:39 AM

China used new rules to suspend stock market trading overnight after another
set of disappointing factory production figures. But for how much longer can
it keep up the pretence?

6) George Soros warns China market meltdown ominously echoes 2008

From www.dailymail.co.uk - Today, 9:43 AM

For the second time this week, trading was halted in Shanghai sending investors into a tailspin after the CSI 300 slipped a staggering 7 per cent just 30 minutes into the day on Thursday.

Market Signals for the US stock market S and P 500 Index and Indian Stock Market Nifty Index for the Week beginning January 4

Indicator	Weekly Level / Change / Significance	Implication for S & P 500	Implication for Nifty*
S & P 500	2044, -0.83%	Bearish	Bearish
Nifty	7963, 1.30%	Neutral**	Bullish
China Shanghai Index	3539, -2.03%	Bearish	Bearish
Gold	1061, -1.42%	Bearish	Bearish
WTIC Crude	37.07, -2.75%	Bearish	Bearish
Copper	2.13, 0.64%	Bullish	Bullish
Baltic Dry Index	478, 0.00%	Neutral	Neutral
Euro	1.093, -0.26%	Neutral	Neutral
Dollar/Yen	120.20, -0.17%	Neutral	Neutral
Dow Transports	7509, -1.49%	Bearish	Bearish
High Yield (ETF)	33.91, 0.12%	Neutral	Neutral
US 10 year Bond Yield	2.27%, 1.16%	Bearish	Bearish
Nyse Summation Index	-20, 85.17%	Bullish	Neutral
US Vix	18.21, 15.69%	Bearish	Bearish
20 DMA, S and P 500	2050, Below	Bearish	Neutral
50 DMA, S and P 500	2067, Below	Bearish	Neutral
200 DMA, S and P 500	2061, Below	Bearish	Neutral
20 DMA, Nifty	7793, Above	Neutral	Bullish
50 DMA, Nifty	7903, Above	Neutral	Bullish
200 DMA, Nifty	8191, Below	Neutral	Bearish
India Vix	14.26, 3.75%	Neutral	Bearish
Dollar/Rupee	66.23, 0.42%	Neutral	Neutral
Overall	S & P 500	Nifty
Bullish Indications	2	4
Bearish Indications	10	9
Outlook	Bearish	Bearish
Observation	The Sand P 500 was down and the Nifty was up last week. Indicators are bearish. Looking for downside to resume.
On the Horizon	Canada - Employment data, Euro zone – German employment data, CPI, Euro zone  CPI, U.S – ISM data, FED minutes, employment data, China – CPI.
*Nifty	India’s Benchmark Stock Market Index
Raw Data	Courtesy Google finance, Stock charts, FXCM
**Neutral	Changes less than 0.5% are considered neutral

The US market was down while the Nifty rallied last week. Signals are bearish for the upcoming week. The markets are failing at resistance and are likely to begin major breakdowns in 2016.  The critical levels to watch are 2060 (up) and 2030 (down) on the S & P and 8000 (up) and 7900 (down) on the Nifty. A significant breach of the above levels could trigger the next big move in the above markets. You can check out last week’s report for a comparison. You can also check out snapshots of the 

S and P 500 and Nifty Indices. Love your thoughts and feedback.

Predictions for 2016

Here are my predictions for 2016:

1) 2016 is finally the year when the Euro breaches parity to the Dollar:

2) 2016 will prove to be a year of significant under performance of risk assets, particularly global stock markets and emerging market currencies:

3) 2016 will prove to be the year where carry trades get liquidated as significant Yen strength resumes:

4) Volatility surges in 2016 as global risk aversion increases significantly: