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Equities are holding firm, the UK’s UK Index and US Dow Jones continuing to digest their recent sharp rally and the DAX even managing a probe higher in spite of a mild USD pullback delivering EUR strength that would normally hinder German exporters. Confidence is derived from Brent Crude oil managing to hurdle the key $50 mark and test 6-month recovery highs overnight (US Crude close to doing the same) while a slightly weaker dollar plays in favour of commodities and their extractors, be they miners or drillers. As highlighted yesterday, an array of recent concerns (China, Fed Summer rate hike, Brexit) appear to have been stowed away safely by bulls who remain fixated on re-igniting this week’s rally to deliver a second leg north towards 2016 highs.
The UK 100 remains in yesterday’s 6250-6580 sideways pause range, digesting gains before a potential breakout towards 2016 highs. The DAX30 has managed a test higher to continue its triple bottom reversal and maintain a northerly course towards 2016 highs of 10500. Wall Street/Dow Jones futures is back above 17850 which open up the possibility of a 100pt run-up a bullish flag to 17950. Gold has bounced thanks to an easing in USD strength, but already found a hurdle in 8-day falling highs resistance as safe-haven demand suffers at the hand of market appetite for risk assets like equities.
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The UK 100 remains in yesterday’s 6250-6580 sideways range, digesting Tuesday’s gains before a potential break higher or lower. Strong potential for this to be a ‘pause flag’ before another rally up the bullish flagpole to continue the triple-bottom May reversal towards 2016 highs of 6430. Note the drop back from an overbought RSI on an hourly chart.
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Possible support
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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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The DAX has managed a test higher to continue its triple-bottom reversal and maintain a northerly course towards 2016 highs of 10500. Aftert the sharp-run-up, note the overbought RSI.
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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Dow Jones futures holding 2-day rising lows and back above 17850 which open up the possibility of a 100pt run-up a bullish flagpole to revisit late April levels of 17950. The major rally and reversal could see it mirror peer indices which have their eye on 2016 highs. Like the UK Index and DAX though, note an overbought RSI.
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 has bounced from a test of $1220, as the USD strength eases, but already found a hurdle at $1233 via 8-day falling highs resistance. Safehaven demand continuing to suffer at the hands of market preference for risk assets. Back to $1210?
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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