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Equities higher this morning, buoyed by a calming of the Chinese currency story after the PBOC fixed the renminbi higher for the first day in four following Tuesday’s devaluation. This suggests its new market-forces based mechanism can indeed work both ways and assuages fears of an aggressively managed Chinese currency sell-off to prop up a slowing economy.
The Greek parliament has voted in favour of the third bailout deal which allows it to be discussed at a Eurogroup meeting of finance ministers this afternoon before being passed to Eurozone parliaments for their own approval. However, political risk remains prominent with Germany still against any hasty arrangement, the IMF still wanting debt relief and the Greek PM calling for a confidence vote next week which is sure to result in September snap elections. Note Commodities still under the cosh on global growth uncertainty and strong USD, with oil plumbing fresh 6.5yr lows overnight.
UK 100 made another bounce off 6550 within 6-week narrowing pattern. DAX found support at 11000. Dow Jones still hindered by falling highs from 20 July at 17450. Gold found support at $1113, still in recovery mode from 5yr lows.
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UK 100 bounced again off 6550 to maintain rising support and 6-week narrowing pattern. Upside test of 6600 nice to see this morning, but falling highs from Monday need to be broken, as well as a break >6650, before 6740 can be eyed.
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Possible support
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Germany’s DAX found support around 11,000 within current 1-month falling channel courtesy of 200-day MA at 10994.
Solid Green line
Possible support
Solid Red line
Possible resistance
Important: The information provided above does not constitute advice or opinion and must only be regarded as technical observations.
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US Dow Jones’ bounce still hindered by mid-July falling highs at 17450. Potential for another leg to the downside, maintaining May downtrend.
Solid Green line
Possible support
Solid Red line
Possible resistance
Important: The information provided above does not constitute advice or opinion and must only be regarded as technical observations.
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Gold recovery from 5yr lows continues with rising support at $1113 following yesterday’s pull-back from 3-week highs. Rising channel offer potential for steady grind higher, although Chinese induced market volatility may sap safehaven interest into week-end.
Solid Green line
Possible support
Solid Red line
Possible resistance
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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