This week’s trading on the Russian market was mixed. Some securities fell heavily, such as shares of MMC Norilsk Nickel, a lot of different troubles fell on them at once, they lost more than 13% in a week, but for example, Rosneft shares set another historic maximum at 536.35 rubles.
There was no general market dynamics, although with Brent oil at $ 67 per barrel, our indices could have been higher. Moreover, many experts unanimously shouted about the impossibility of ignoring external positives and avoiding geopolitical risks, since the EU got off with only personal sanctions against individuals involved in the fate of Navalny.
But if you think for the future, then there is not so much positive around. Within the framework of the new week, an OPEC + meeting will be held, at which the issues of the planned joint increase in oil production by 0.5 million b / d, which did not take place in January, as well as the further fate of 1 million b / d, which Saudi Arabia voluntarily removed from the market. The meeting will take place on March 3-4.
With the current oil prices, the possibility of a split in the union is not ruled out, although of course it is not profitable for anyone to follow the path of last year and completely break the agreements. Plus, do not forget about the technical overbought prices, a rather steep upward trend has been present in oil since November 2020. And the corrective zigzag reached its targets in the form of the level of $ 66.29 per barrel (from the February 15 review), which means there is something to fix. The immediate targets of the correction for oil are seen in the regions of $ 62.50-62.70 and $ 61-61.20 per barrel.
In addition, the main intrigue remains the sanctions promised by the United States in response to the alleged cyber attacks of the Russian Federation. Until now, all the statements of the new American President Joe Biden looked nothing more than horror stories, but is he ready to move from words to actions? What will be the punishment for Russia? Until we can answer this question, I prefer to remain a local “bear”.
Besides, if you look at the daily chart of the ruble index, what do I see? I see two trading sessions closed below the February 1 support level and the EMA21 level the other day.
And if in the near future the Mosbirzh index goes beyond the support level, which lasts from November 30, 20, that is, fixes itself below the level of 3350 points, then with a high probability we will have a hike to the region of 3100-3150 points, and there is certainly no way to new highs.
For clarity, I have plotted information on the price of Brent oil on the daily chart of the Moscow Exchange index. Note that since the second half of January, our market has been drawing less high peaks at higher oil prices. What will happen if it not only stops growing, but also begins to correct?
And the last thing. On Friday, the US House of Representatives plans to hold the first vote on President Joe Biden’s $ 1.9 trillion stimulus package.
Everyone is so convinced that the new package of measures will “save” the economy and stock markets that I have a completely opposite desire.
What kind of reaction do you expect from the markets?
Scavo (Ignatenko) Anastasia
PS The Moscow Exchange plans to start trading on the foreign exchange and precious metals markets, as well as the derivatives market, from March 1, 2021, at 7:00 Moscow time. At present, trading on the foreign exchange and derivatives markets of the Moscow Exchange is held from 10:00 to 23:50.