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Equity markets are holding up well into the weekend, buoyed by this week’s USD-weakening dovish Fed update and the prospect of highly accomodative global monetary policy sticking around for a good while longer. The Fed has dialled back its expectations for the pace of rate hikes on account of global downside risks. Peers have delivered gloomy outlooks. This means that aggregate global monetary policy has more chance of easing than it does of becoming tighter in the near-term. All of this is serving to keep well-nourished the appetite bulls have for risky assets such as equities and commodities.
UK Index finally broken above March highs of 6220. DAX recovering from yesterday’s lows, back trading above 9900. Wall Street made a bullish break from rising wedge at 17500 to trade 2106 highs. Gold broken down from a 3-day bearish head & Shoulders top pattern at $1257.
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UK 100 finally made it above March highs 6220 to test levels last seen in very early Jan. Potential for it to join Dow Jones and go positive for the year. The breakout beyond multi-month falling highs and first close above the key 200-day moving average (6180) since last June represents the clearing of a major hurdle..
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Important: The information provided above does not constitute advice or opinion and must only be regarded as technical observations.
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DAX off its worst levels of yesterday, when a weaker USD (blame the Fed) meant a stronger EUR which hurt all those DAX exporters (BMW, Siemens, etc) whose wares became more expensive to non-EUR buyers overnight. Still in a Feb uptrend.
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Possible support
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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 made bullish break from rising wedge at 17500. Potential for gains to continue, especially after getting above 17250, however, it’d be careless not to highlight the near 13% rally of late – the same scale of move last October before a sharp reversal. RSI also suggests index now overbought (as it was by early Nov).
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Possible support
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Important: The information provided above does not constitute advice or opinion and must only be regarded as technical observations.
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Gold is suffering from appetite for risk assets denting demand for safehavens. After the strong bounce on Wednesday when the USD weakened sharply (making the yellow metal cheaper) the bounce may have run its course. The is is visible via the breakdown from a bearish head & shoulders top pattern which has potential to see a retrace of $15-20.
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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