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After yesterday's London session dive the Dow has regained Tuesday's levels with the Nikkei not far behind so looking for similar progression in the Dax and FTSE in this morning's session. 

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The Dax and FTSE failed to keep step with the Dow yesterday and remain near the lows of their recent ranges while the Dow looks to break out of the top on it's own, the lack of EU and UK follow on is presumably the result of the Turkey situation and the large exposure of Euro banks. With the Dow being a leading index and that link temporarily broken the short term direction for the Dax and FTSE is not clear.

Weekly charts;

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Expecting Dow to continue to creep higher so looking for Dax to retest 12375 and FTSE to retest 7617.

4 hour charts;

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Trump in the news again and the markets wobble. The Dax , Dow and FTSE appear to have put in a short term base and look to be testing the highs following Nikkei but they are very nervous. 

The Euro open is suggesting a retest of the lows but will wait for the London open for confirmation as to direction.

1 hour charts;

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Dow, Dax and FTSE remain stuck in this tight range of the last 4 or 5 days waiting for something to break it, China trade news presumably.

4 hour charts;

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Nikkei has pushed on higher while the Dow, Dax and FTSE are trying to push up off support so today looking for the Dax to retest 12412 and 12441.

1 hour charts;

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Dax just put in an interesting break bar on the European open following the Nikkei up while Dow sits poised to break higher as well.

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Dow makes the big break and looks now to be eyeing up the January high which is over 600 points away so likely be some bumps on the way. Dax will have the same problem reaching for 12887.

Daily charts;

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All a bit hesitant yesterday but a look at the weekly charts show Dow's continuing rise while Dax and FTSE moving up off good support and Nikkei pushing hard against resistance.

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Tomorrow is month end and end of the holiday season, as things pick up will the early signs point to a break up and out of the weekly chart in the previous post, or head back down?

On the daily chart Dow and Dax have stalled the last few days. FTSE testing recent support and the Nikkei not will to go higher alone.

Dax stuck in it's recent range with the Euro open 1 hour bar suggesting a retest of 12497 initially. 

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The 4 hour charts show all 4 indices trying to pick themselves up off support and the biggest risk (China- US trade war) subdued for the temporarily (Trump doesn't start tweeting til about 1pm UK time). So in the morning session will be looking for Dax continuation towards 12577 though being a Friday and month end and with a lot of uncertainty about it may well get a bit dull.

4 hour charts;

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So that call went wrong very quickly. Dax immediately dropped to challenge and break support on the London open and is now in the middle of a congestion zone the bottom of which is around 12290. Not dull at all but not clear what it's going to do from here.

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1 hour ago, Caseynotes said:

So that call went wrong very quickly. Dax immediately dropped to challenge and break support on the London open and is now in the middle of a congestion zone the bottom of which is around 12290. Not dull at all but not clear what it's going to do from here.

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I got stopped out yesterday at the SP500 after going long, I re-entered now.

Given the political news oriented around the tariffs, and the positive sentiment on a Canadian deal and solid fundamentals in the U.S. I only trade long, and enter long positions when the VIX shoots higher.

DAX and the E.U. is a different beast when it comes to GDP growth versus the U.S. with core inflation at 1%.

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Increasing chatter on twitter that a US deal with Canada looks increasingly likely by today's deadline.

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The indices are looking for support following the China/US trade negotiations fail. Dax trying to hang on to 12309 while FTSE saw a good bounce up off 7417.

4 hour charts.

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Dow and Nikkei still have their bull flags intact while Dax tries again to lift up off 12298. FTSE looking to continue its move upward, currently at yesterday's high after a US session  pullback.

4 hour charts;

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The 8am London open yesterday saw the Dax run straight down nearly 250 points before staging a pullback. The 7am European open today Dax is testing yesterday's low - 12161, below that is the weekly chart support level at 12110 (red).

The other three are also looking for support with the FTSE trying to hang on to 7436 but a test of 7417 looks likely.

1 hour charts;

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Interesting split as the Dax and FTSE break below their weekly support levels while Dow and Nikkei remain in touch with their highs. Early price action this morning suggests the Dax wants to go lower, the desync between the US and Euro/UK indices is a bit disconcerting. As mentioned in the APAC brief there is no scramble to safe havens in the US as yet so it's wait and see. NFP tomorrow may rearrange things.

Weekly charts;

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Dow continues in it's bull flag while the others are still looking for support. A look at the monthly charts shows a different perspective where the Dow is within striking distance of the highs while Dax, FTSE and Nikkei regroup.

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The recent disconnect between the US and other DM continues while EM continue their slide. If this is all down to trade wars it's seems clear who must be winning but that's not the whole story. A while back in another thread I relayed a report I had read about the improved repatriations of US company profits back into the US thanks to Trump's cutting of corporation tax. I'd seen a report that the figure had risen from $38 Bln previous to nearer $380 Bln for 2017. But a few days ago I read a Bloomberg news report that repatriations were $380 Bln (up from $50 Bln average over last 5 years)   for Q1 of 2018.

Admittedly I may have misread along the way but whatever, there is a lot of money coming out of other markets back into the US economy.

 So looking at the weekly charts again, from a technical stand point. Dow is looking to test the highs 26166 and 26703.

Dax looks to test the low of 11690, FTSE the low of 7094, Nikkei the low of 21834 and 21451.

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Dow remains in it's bull flag while the rest attempted to rise the most successful being the Nikkei. FTSE stagnant around 7280 while Dax tries to get purchase on the 12000.

Daily charts;

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Interesting pin bar double bounce off recent support for both Dax and FTSE daily candles while Dow also tested support before heading back up.

Super Thursday tomorrow with EU and BoE rate decisions and mon policy statements.

FTSE and GBPUSD will continue to be at risk from Brexit statements and increasing Tory rebellion against May's leadership.

Daily charts;

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Mostly doji candles for yesterday, Nikkei shifts higher, Dax and FTSE rest on support while Dow presses resistance. Super Thursday, no change in rates expected. BoE vote count and Mon Pol statement at 12:00 and Draghi presser at 1:30.

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    • Going back to my FTSE analysis I see things as follows: 2 scenarios present themselves, other than fresh ATHs that is: 1) the move down to the turn on Thursday was a wave 1 (blue) off a larger scale wave 2 (purple) that should retrace, maybe in a complex fashion with a lot of whip saw price action maybe not, let's see; 2) the recent rally and drop to a new low was a 1-2 (red), which indicates a much stronger leg down is immanent. The #2 scenario would only be valid if price holds below the previous high (circa 7300).  I favour the #1 scenario. There was PMD on the 4H chart at wave 1 (blue), which suggests this is a turning point.  Also the 4H chart shows a 1-5 wave down to the 1 blue, which would be motive and suggests a trend change to the bearish side. There was strong NMD at wave 2 (Purple) which is consistent with a large scale retrace move. Just as with the US large caps, after the stop and turn up there was a sharp retrace drop to the Fib 76/78% zone before the current rally.  As the FTSE was in out of hours at the end of the week this market has not rallied as hard as the US markets.  Also we may yet see fresh ATHs on US large caps while the FTSE100 only puts in a counter trend rally. If we do see fresh ATHs on US large caps and only a retrace on FTSE and probably Dax and Nikkei as well then comparing these markets will be instructive for calling that top on US large caps.  We may, alternatively, see only a retrace on US large caps too if the top of the market in already in. Conclusion: we can anticipate a bullish period on all major indices BUT should guard against a quick reversal on FTSE 100 that would set up scenario #2.  Either way this market looks to have topped out so the coming months though to the Autumn will be critical to deciding things on all indices, and likely quite a few other markets. I am Long the FTSE 100, coincident with my Dow Longs and will swing this up for now but my bearish bias for the long term will keep we watchful for a break down of this rally and I will not be pyramiding this one, far too risky until things are resolved.
    • "....more broadly we have seen currency wars but these have not really captured the imagination of the MSM yet" Actually I'd argue we have had currency wars for some years already. History shows it goes in the following order: Currency war, Trade war, War. (Regrettably).  If I recall correctly the market falls of early 2015 (about 20% down) were blamed on Yuan being devalued by Chinese manipulation. Way before Trump! "....we suddenly get a super massive set of central bank policies that drop rates to zero" Again I'd say that has been going on for some years. Arguably you could say about 35 years since the Plaza Accord. Once fiat became unaccountable (no gold standard) the politicians proceeded to spend, spend spend =debt,debt,debt. Expect MMT  (US Democrats pushing modern monetary theory) to allow them to continue in that vein. Again history says these currencies will all eventually disappear, like species, approx 95% no longer exist.  Broadly I agree with what you say. The present financial system is critically sick that's for sure. It has propped up assets with huge doses of QE and zero rate interest policy (expect more of that when the ECB meets next month). You are correct about the size of stock markets. If the global market was a horse the bond market would be three legs of it! I digress.... However, if you are faced with massive debts then here are your options: 1) Default - Argentinian/Zimbabwe style. Not likely, at least until all other options tried - as that's the end game. 2) Grow the economy at a fast enough rate to meet and exceed future repayment obligations. In a global low anaemic growth environment? Unlikely. 3) Inflate like mad. It's the only viable option. You could, reasonably say, that after 3 massive QE sessions and ZIRP and now  NIRP that deflation is winning. Arguably it's all been a waste of time / money. Where's the kitchen sink? Presumably more of the same and then some helicopter money? It seems to me that this is more in line with Japan (targeted 10yr bond rate = 0%) which someone said in the 90s was  "...the dress rehearsal. The rest of the world will be the main event". Trying to get inflation without destroying the USD global reserve status is unlikely in my opinion and you can't help but feel that some sort of Bretton Woods global RESET will eventually emerge. It's certainly what Russia, China, Syria, Iran, Turkey etc are angling for.....and their central banks have been big buyers of bullion recently. That's why I'd recommend holding gold. Not as a trading strategy (which is what I appreciate this forum is). Nice sharing these thoughts with you>
    • So it looks like my crazy set of channels on the Daily chart is still holding well.  The breakout of the last channel line, which coincides with a nice zone of lateral S/R was retested but failed as I noted in my previous post.  I got Short off an initial rejection from this zone and Resistance line with a tight stop but price never came back so nicely in on a couple of Short positions and stop protected at BE.  Price moved back through the monthly lower channel line (purple) and put in a quick daily candle failed retest and dropped away.  It is possible we could see another retest of this resistance zone before any further move but a break below the 5760 level would be indicative that the Bear has resumed and obviously a break of the previous low around the $56 mark would once again bring $50 into focus.  
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