DAX 30
Retreating only fractionally from the record high and almost overbought; all are small signs of instability.
SHORT TERM TRADER: Square.
POSITION TAKER: Square.
FTSE 100
Yesterday’s shooting star candle reinforces our view that the break above the neckline of a head and shoulders top is something of an extension which will prove to be a false break. The MACD, while no longer bearish, is only barely bullish.
SHORT TERM TRADER: Small short at 7265; stop above 7350. First target 7100.
POSITION TAKER: Small short at 7300; stop above 7350. Target 6650.
S&P 500
A shooting star doji candle almost at the record high as the commodity channel index turns down is divergence and denotes instability.
SHORT TERM TRADER: Square.
POSITION TAKER: Small short at 2335; stop above 2405. Target 2150.
BRITISH POUND/US DOLLAR
Pushing up from its pennant pattern, retesting this year’s high at 1.2905, as Intercontinental Exchange’s chief executive says the UK should approach Brexit with ‘a little bit of swagger and not worry too much about the detail’ because it has ‘a very strong hand’.
SHORT TERM TRADER: Small long at 1.2785; stop below 1.2600. Target 1.3200.
POSITION TAKER: Square.
EURO/US DOLLAR
Holding just under the high for this year at 1.0950 but the hanging man candle and a deteriorating commodity channel index are flashing a warning.
SHORT TERM TRADER: Tiny short at 1.0885; stop above 1.0950. Target 1.0600.
POSITION TAKER: Square.
GOLD
Drifting fractionally lower as the commodity channel index turns more bearish.
SHORT TERM TRADER: Short at 1271; stop above 1280. Target 1200.
POSITION TAKER: Square.
MORE FROM NICOLE ELLIOTT...
Nicole Elliott is a longstanding Member of the Society of Technical Analysts and provides the IC's trading coverage. She is regularly interviewed and quoted by the financial media, is a conference speaker and author of several books on charting.
