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Equities are negative this morning as markets take their usual breather ahead of a major central bank update, adopting a holding pattern before the ECB this afternoon and after strong July gains. No rate changes are expected (too early to react to Brexit, same as BoE) but there is the possibility that its €80bn/month QE stimulus programme is tweaked. This because it finds itself in a bind, fishing from the banks of a bond pond drying up fast as security-seeking investors drive up prices, leaving fewer and fewer eligible yielding tiddlers to net. Draghi’s press conference is likely to be littered with the usual dovishness to keep investors happy about accommodative policy for longer. And while hopes of helicopter money in Japan may have been dashed this morning, markets aren’t quite reaching for the ejector seat. Just another pause?
The UK 100 is hovering just above 6700, testing Jul’s trend-line of rising support. The DAX30 has dropped back from a test of 10200, but is holding July rising lows at 10100. Dow Jones futures have broken their July trend of rising lows, but are holding 6-day rising support at 18565. Beware negative divergence with RSI. Gold’s July sell-off has found support at $1310 thanks to a trend-line of 2-month rising lows. Safe-haven demand on the rise? Bad news for risk assets like equities?
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The UK 100 is hovering just above 6700, testing Jul’s trendline of rising support. Will it bounce or will it break down?
Watch levels: Bullish 6725, Bearish 6685
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 DAX30 has dropped back from a test of 10200, but is holding July rising lows at 10100. Further to run for the uptrend? Beware negative divergence between price and RSI; a potential warning signal of an impending reversal.
Watch levels: Bullish 10135, Bearish 10080
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
Wall Street/Dow Jones futures have broken their July trend of rising lows, but are holding 6-day rising support at 18565. Beware negative divergence with RSI which has itself broken its uptrend as it corrects from overbought. Is a sell-off on the cards?
Watch levels: Bullish 18590, Bearish 18550
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 July sell-off has found support at $1310 thanks to a trendline of 2-month rising lows. Safe-haven demand on the rise? Bad news for risk assets like equities? Note the RSI rebounding from being briefly oversold.
Watch levels: Bullish $1325, Bearish $1317
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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