sovereign debt

sovereign debt

Trading Euro Zone Stocks

3d ago
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http://www.ProfitableTradingTips.com - Trading Euro Zone Stocks Trading Euro Zone stocks received a boost as the EU moves toward a more integrated fiscal and budgetary system. The EU sovereign debt dilemma has not only threatened the Euro but the integrity of the European Union itself. European stocks have suffered as the economic recovery in Germany, especially, has slowed. Recent pronouncements by German and French leaders sparked a brief rally in markets across Europe with profits for many of those trading Euro Zone stocks, at least those who expected a rebound from the recent slide. As always in trading a down market, there is a possibility of a rebound and those who anticipate the same via fundamental and technical analysis are rewarded. The state of European debt is sufficiently bad that it threatens not only the European economies but also those of the exporting nations of Asia. China is expected to see reduced economic growth in the next year and the post tsunami recovery in Japan could be affected as well. Nevertheless those trading Euro Zone stocks saw substantial action in response to what was perceived as good news coming out of Berlin and Paris. However, volume quickly dropped off in trading European stocks as traders and investors adopted a subsequent wait and see attitude. For the individual stock trader looking to profit from trading Euro Zone stocks there a couple of possibilities. First of all a trader can trade directly in European markets through exchanges such as Deutsche Börse AG or NYSE Euronext, or by trading Euro Zone stocks listed as American Depository Receipts on the NYSE North American traders can deal with an exchange that uses its own language. Traders can use the same trading techniques and strategies as in trading North American stocks. Options trading is a useful approach to limiting risk chaotic markets, which certainly fits for stocks trading in Europe today. Technical trading works as well. The recent reverse head and shoulders charting pattern seen recently in both the Euro and European stocks is just as predictive of a bullish reversal of a downward trending market in trading Euro Zone stocks as in other markets. Banks and insurance companies are especially volatile these days in Europe because of their exposure to the debt of the so called PIIGS group of nations (Portugal, Italy, Ireland, Greece, and Spain). Following the news is essential in trading Euro Zone stocks, at least over the short run. Every positive pronouncement is met by a rise in the Euro and stocks and every cautionary pronouncement is met by a slide in the same. Over the longer term the picture is different. One does not need to limit oneself to trading banks and insurance companies. Companies like Diageo, Siemens, and Roche do business worldwide. These companies are not likely to be hurt greatly by the slow currency devaluation brought on by falling currency values. In fact a cheaper Euro might well help a company like Siemens in selling their products in the four corners of the earth. What such a company loses in sales due to a European recession could well be made up for in international sales. For those with a longer term view timing stock trades is less important. As always we are not suggesting that anyone trade Euro Zone stocks or avoid them. We offer this discussion as an example of the thinking that might go into choosing stocks to trade and learning how to trade them. http://www.youtube.com/watch?v=H5d-SRRGEB8