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Equities are positive this morning, holding on to recent highs but lacking conviction with event-risk lurking through Friday. Asian markets saw concern creep in that expectations for stimulus from the BoJ and hawkish rhetoric from the Fed may have been too high (USD/JPY chart still in 5-month falling channel). The BoE’s Weale may have offset this somewhat by suggesting recent UK data urges him to vote for a rate cut next week, to keep the global stimulus train chugging, but Cable (GBP/USD) has since bounced. And a weaker USD is not helping the commodity space, especially oil.
The UK Index is outperforming thanks to an OFCOM stay-of-execution for BT’s network business, sending its shares 5% higher, while HSBC is up on hopes of insulation from Brexit and exposure to Asian monetary stimulus. Many other defensives helping with the heavy lifting as investors still opt for defensive non-cyclical bond-proxies at the expense of risk assets. Note BP hindered by a lower oil price and poor Q2 results and Housebuilders by Brexit concerns. UK Banks are suffering from contagion risk related to Eurozone sector stress tests and earnings season, as well as the prospect of profitability being hit by a BoE rate cut.
The UK 100 is holding around 6730 into the apex of a 2-week bullish ascending triangle worth 150pts if we can break above 6750. The DAX 30 trades around 10200, still in a 2-week rising channel towards 10300 and, ultimately, 10500. Dow Jones futures are back below 18500, that negative RSI divergence proving correct about the index potentially topping out. Gold is trying its best to engineer a bullish bounce from 2-month rising lows at $1315.
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The UK 100 is holding around 6730 into the apex of a 2-week bullish ascending triangle worth 150pts if we can break above 6750.
Watch levels: Bullish 6745, Bearish 6695
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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The DAX 30 trades around 10200, still in a 2-week rising channel towards 10300 and, ultimately, 10500.
Watch levels: Bullish 10240, Bearish 10180
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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Wall Street/Dow Jones futures are back below 18500, that negative RSI divergence with price proving correct about the index potentially topping out.
Watch levels: Bullish 18510, Bearish 18460
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
Gold is trying its best to engineer a bullish bounce from 2-month rising lows at $1315, but still technically in a 3-week falling channel from the heights of its 2016 rebound. Note that RSI rebound from a brief flirt with oversold.
Watch levels: Bullish $1325, Bearish $1319
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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