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Equities are treading water this morning as markets await what will surely be the most important central bank update of the summer. Those that are espousing kitchen sinks will no doubt find their argument firmed by the fact that the Aussie ASX has closed lower every day this week following Monday’s RBA rate cut while the Nikkei is 3% lower since the latest stimulus package was announced by the Bank of Japan on 28 July. Clearly there’s a worry that, even if we do get a 25bp rate cut from the BoE, that in itself may not be enough to endow markets with enough confidence to consign a post-Brexit recession to history before it’s even happened!
The UK 100 has pulled back towards the floor of its falling yet narrowing pattern with a break below the 20-hour moving average. The DAX 30 has bounced off the floor of its 380pt range as the Euro pulls back, having failed to better the 6 Jul high vs. the GBP. Dow Jones futures have also bounced on a slightly weaker USD yet remain under pressure from a sentiment point of view and falling oil prices. Gold has moved down out of its August bearish rising wedge and below its 100-hour moving average. Support found at $1350.
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The UK 100 is still in its falling channel with the 50-hour moving average keeping the index in the lower half. Potential for support at 6610 to send the index sideways from here, though technicals are likely to go out of the window around midday.
Watch levels: Bullish 6660, Bearish 6600
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 is finding it tough up around the 100- and 200-hour moving averages (which are making a bearish cross), with 10, 270 making it a trio of resistance levels for the index. A break above these would delight bulls. Note potential for a negative surprise from the BoE to weaken the Euro and make this possible. Otherwise, we’re looking at a retracement to 10,100. RSI still bullish.
Watch levels: Bullish 10295, Bearish 10215
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 pulling back from their 20-period moving average with a still bearish RSI and still negative momentum, although the latter is testing its trend of falling highs.
Watch levels: Bullish 18400, Bearish 18300
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 still consolidating around $1350. Resistance at the 100-hour moving average and a steep trend of falling highs since yesterday. However, note support at $1349 has potential to engineer a bounce at least as far as $1355.
Watch levels: Bullish $1355, Bearish $1348
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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