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Quiet Start For Markets
It’s been a relatively muted start to the week for global equities benchmarks. The four indices tracked here are sitting around highs currently, though momentum has largely receded. Last week’s on the headline NFP release capped any hope of a Dollar rebound, which has allowed equities to retain support for now. While average earnings and the unemployment rate both beat expectations, the NFP result itself was weaker than expected, highlighting that the US economic recovery is not as straight forward as some judge it to be.
This week, the big focus is on the US CPI result. Following a much stronger than expected result over the prior month, any further upside this week could reignite USD bullishness, weighing on equities in the near term. A miss, however, would likely see USD bullishness weakening further, allowing equities to continue higher.
Later in the week, the June ECB meeting will take centre stage. The big focus is on whether the bank will announce a tapering of asset purchases which, if announced, will see European asset markets move lower. Should the ECB refrain, however, this should keep EUR assets supported for now.
Technical Views
DAX
The DAX remains above the 15486.96 level for now, trading within the upper end of the bull channel. While MACD and RSI are both bullish, bearish divergence in both indicators is worth noting. Any slip below the 15486.96 level in the near term will open the way for a test of the 14791.27 level next.
S&P500
The S&P continues to hold around the 4236.50 level highs. MACD is roughly flat here, as is RSI, highlighting the lack of momentum in the market. For now, the focus is on a further push higher, in line with the longer-term trend. However, any break below the 4182.50 level, will turn the focus to the 4116 level support next
FTSE
The rally in the FTSE has lost momentum over recent weeks with price caught in a range between the 6895.6 level support and 7137 level resistance. The rising trend line from 2021 lows continues to support the move for now, keeping the focus on further upside. Both RSI and MACD are flat for now, suggesting plenty of room for expansion in either direction once a break is made.
NIKKEI
The rally in the Nikkei over recent weeks has seen price trading up to test the bear channel top, which is holding as resistance for now. Both MACD and RSI are bullish here, keeping the focus on further upside. Above here, the next region to note is the retest of the broken bullish trend line.
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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.