wipe off! New update on our ‘Green Bond’ (ESG) outlook :: InvestMacro

Excessive euphoria in financial markets is usually a great cause for ‘skepticism’.

by Elliot Wave International

Environmental, Social and Governance (ESG) bonds – also called “green” bonds – are offered by companies that want to promote the causes of social justice, social inclusion and green technology.

This form of debt has been steadily gaining popularity – from sales of less than $100 billion in 2015 to nearly $800 billion in 2020.

For example, here’s the October 9, 2020 headline from Pensions and Investments:

University of Toronto fund bets $7 billion on ESG debt

However, the Elliott wave structure of the global green bond index was sending a warning signal.

July global market perspectiveElliott Wave International’s monthly bulletin covering over 50 global financial markets, showing a chart from December 2020 global market perspective (left) and an updated chart on the right.

Focusing on the left chart first, which saw a five wave advance (which means a trend turn was imminent), December 2020 global market perspective He said:

Experts loudly declared that so-called social connections would be the next great innovation. …but the euphoria that surrounded this new religion is actually one of the biggest reasons to be skeptical. … Stay away from both green links and social links.

In fact, as the updated right-hand chart shows, the price started declining shortly after this warning. Eventually, a rally in the opposite direction ensued, and by July 13, 2021, a Bloomberg headline said:

ESG Bond Sales Race to $1 Trillion as Investors Power Change

Once again, the global market perspective Provide a warning – this is from the August 2021 release:

The survey could be bigger than ever.

You can see the big crash in prices that happened next.

Understand that the Elliott wave model does not guarantee that the financial market will behave one way or the other. At the same time, it is the best analytical method that Elliott Wave International knows because it is based on the recurring patterns of investor psychology.

In fact, this is what Frost & Prechter said The Elliott Wave Principle: The Key to Market Behavior:

Wave theory is governed by the social nature of man, and since then she has Such a nature, its expression generates forms. as the shapes recursivethey have predictive value. [emphasis added]

For a limited time, our friends at Elliott Wave International 5 bring you quick snapshots of Elliott Wave patterns across many markets – stocks, shares, and bonds – all from their new July 2022 release of global market perspective.

The publication provides an analysis of more than 50 major markets in the world.

See what warnings it gives Currently.

Free, check out 5 short excerpts From the new, July global market perspective

This article was published by Elliott Wave International and was originally published with the headline wipe off! New update on our ‘green bond’ (ESG) outlook. EWI is the world’s largest market forecasting company. Its staff of full-time analysts led by Certified Market Technician Robert Prechter provides 24-hour market analysis to institutions and private investors around the world.

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