S&P Leads The Way
Global equities benchmarks have started the week in a rather muted fashion as traders await fresh directional catalysts. US equities have been the strongest performers so far given that Friday’s US jobs report was inconclusive for USD bulls. While the headline NFP reading was well above forecast, along with an upward revision to the prior month, both the unemployment rate and average hourly earnings disappointed forecasts. The pause in the recent USD ascent means that equities markets have refrained from correcting lower for now. However, upside momentum has waned also with the growing focus on the global spread of the delta variant offering some cause for concern. Despite the remaining risks around the variant, given that the death rate is staying low in key economies, despite rising infection rates, markets have so far refrained from any proper downside action.
Looking ahead this week, the focus will be on the FOMC meeting minutes on Wednesday. Given the hawkish skew to the June FOMC meeting, traders will be keen to see just how hawkish the discussion at the meeting was, creating upside risks for USD into the middle of the week which could weigh on equities.
Technical Views
DAX
The DAX continues to trade in a tight range between the 15486.96 and 15743.01 levels. With both MACD and RSI turned lower here, there is room for a drop below the support level which would turn focus to the next support level down at the 14791.24 level, where the rising channel support is also.
S&P500
The S&P is moving firmly higher this week as price continues to rally above the 4236.50 level. Despite a brief move below the rising trend line, the S&P is now well supported once again and with MACD and RSI turned higher, the focus is on further upside in the near term. To the downside, any correction lower will find support into the 4236.50 level first with 4182.50 sitting just below.
FTSE
The FTSE continues to hover around the 7137 level for now which is still holding as resistance, along with the retest of the underside of the broken bullish trend line. The market has been in consolidation mode for quite some time now and with MACD broadly flat, there is room for a move either-way. To the topside, the next level to note is the 7241 level with 6895.6 the next key support to note.
NIKKEI
The Nikkei continues to grind lower here with price hugging the broken bear channel resistance line. While both RSI and MACD are bearish here, there is room for a pop higher while price holds above the 28356.6 level. Should price slip below there, however, the 26932.1 level is the next big support to watch.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.