Market forecast: Front running in stocks, safe havens could rebound - Brenda Kelly

Most investors are baffled by the rise in the Dow Jones to record highs amid sharp spike in the yields coupled with a sharp sell-off in the traditional safe havens - Gold and funding currencies - JPY and EUR.

The question everyone faces is whether the equities could sustain at record highs on Trump outlook. There is a feeling in the markets that the safe havens would be out of demand for a long time to come as the world heads towards ‘Fiscalism’.

Listen to this segment in which Brenda Kelly, Independent Market Strategist, says the idea that safe havens could be permanently out of demand is quite illogical. There are potential risks ahead - elections in Europe. She adds the Dollar-Yen looks pretty overstretched, although she maintains her bullish outlook, given the pair sits comfortably above the 200-DMA.

While talking about Trump and his spend till end policies, Kelly warns that proposing massive stimulus is one thing and having one is a completely different thing. Thus, the frontrunning in the equity market could turn out to be a trap for equity bulls and safe haven bears.

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