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Index Focus - 24 August 2016

Equities are still mixed after the open, though buoyed as confidence in the UK’s house building sector helps to offset the drag caused by oil and mining stocks, both being hit by more hawkish US Fed rhetoric ahead of Friday’s Jackson Hole speech by Chair Janet Yellen. Crude prices are also reacting to yesterday’s bearish fundamentals (API data showing an unexpected swelling of US crude stockpiles), with another data print from the EIA potentially following suit today.  In terms of US policy, note a tendency for equities to react in a positive manner if the message is one of US economic health, plus the fact the USD Basket is in a place that would allow for a spike up if Yellen does decide to be hawkish herself.

Mindfulness is all the rage these days – could we be seeing markets becoming aware of their own complacency, labelling it as such and setting it aside to focus on the game in hand (whatever that is, man)?!

The UK 100 is volatile around 6860, just above its 20-day moving average. The DAX 30 has support at 10600 with support in a weaker EUR vs. the USD. Dow Jones futures continue to trade in a 170pt range near their all-time highs. Gold is as gold does from time to time, muted with August falling highs and July rising lows funneling it into wherever.

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Where next?
  1. Will the index fall towards lows of 6810? or;
  2. Will the index rise towards highs of 6955?

The UK 100 is up & down around 6860, yet looks as if it would like to get back to the ceiling of its recent sideways range. A decisive bounce off the 50-hour moving average would please bulls looking for just that.

Watch levels: Bullish 6870, Bearish 6840

Solid Green line
Possible support

Solid Red line
Possible resistance

  • Trend: Sideways
  • Potential support: 6856, 6850, 6840, 6830, 6820, 6800
  • Potential resistance: 6868, 6880, 6883, 6900, 6920, 6940, 6955

Important: The information provided above does not constitute advice or opinion and must only be regarded as technical observations.

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Where next?
  1. Will the index fall towards lows of 10500? or;
  2. Will the index rise towards highs of 10805?

The DAX 30 is at resistance around 10630, but could confirm the 200-hour moving average as support in due course which may see the idnex back in the range it had between 9 and 17 August.

Watch levels: Bullish 10650, Bearish 10610

Solid Green line
Possible support

Solid Red line
Possible resistance

  • Trend: Downtrend
  • Potential support: 10620, 10600, 10590, 10560, 10520, 10500
  • Potential resistance: 10650, 10695, 10740, 10800

Important: The information provided above does not constitute advice or opinion and must only be regarded as technical observations.

Click here for help with Support & Resistance Click here for help with technicals

Where next?
  1. Will the index rise towards highs of 18670? or;
  2. Will the index fall towards lows of 18470?

Dow Jones futures are back in the middle of their 2 week range and testing resistance at the rising trend line from the 2 Aug low  

Watch levels: Bullish 18575, Bearish 18525

Solid Green line
Possible support

Solid Red line
Possible resistance

  • Trend: Sideways
  • Potential support: 18550, 18535, 18500, 18465, 18400
  • Potential resistance: 18570, 18585, 18600, 18630

Important: The information provided above does not constitute advice or opinion and must only be regarded as technical observations.

Click here for help with Support & Resistance Click here for help with technicals

Where next?
  1. Will Gold fall towards lows of $1330? or;
  2. Will Gold rise towards highs of $1365?

Gold’s remains range bound between $1332 and $1350, still hostage to the USD and largely out of favour given increased risk appetite in equity markets.

Watch levels: Bullish $1341, Bearish $1333

Solid Green line
Possible support

Solid Red line
Possible resistance

  • Trend: Sideways
  • Potential support: 1336, 1335.5, 1334, 1333, 1332
  • Potential resistance: 1340, 1341, 1342, 1343.5, 1344.5, 1348, 1349, 1344, 1356

Important: The information provided above does not constitute advice or opinion and must only be regarded as technical observations.

Click here for help with Support & Resistance Click here for help with technicals

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