In what many are terming a much needed dose of good news for PM Abe and his three economic arrows, Q2 GDP data released this morning showed that the Japanese economy grew at 2.5 per cent Q/Q and 4.0 per cent Y/Y. This is the best pace in two years though the deflator continues negative at -0.4 per cent. The bulk of this improvement was down to public investment.
Data provider IHS today published July’s PMI survey this morning showing that employment levels in London are growing at the fastest pace since April 2016. Over the latest quarter 27 per cent of firms expect to hire people as compared to 20 per cent in Q1. Despite this, pay rises remain modest which probably explains why, yet again, shoppers in the capital shied away from the high street so that footfall dropped 2.1 per cent in the year to July.
DAX 30
Bouncing this morning from Fibonacci 23.6 per cent retracement support taken from February 2016’s low. The weekly MACD remains clearly bearish so we shall allow for consolidation below horizontal resistance at 12345.
SHORT TERM TRADER: Small short at 12225; stop above 12355. Target 11550.
POSITION TAKER: Short at 12175; stop above 12415. Target 11500.
FTSE 100
A bearish engulfing candle on the weekly chart, as expected, turned momentum bearish. Clinging to horizontal support and managing a pathetic little bounce this morning – which media are hailing as a bright new dawn.
SHORT TERM TRADER: Took profits on Friday’s close at 7300 and decided to run a longer term short position. As a short term trade will therefore be looking for a level at which to re-sell.
S&P 500
A slightly inconclusive weekly candle after the previous three tiny ones. Note that the MACD has been marginally bearish since April. Certainly no technical signs that this is a buy – still.
SHORT TERM TRADER: Short at 2468; stop above 2485. Next target is pivotal support at 2400.
POSITION TAKER: Will sell only on a weekly close below 2400.
BRITISH POUND/US DOLLAR
Still trying to cling to the 1.3000 retracement resistance area which lies just below trend line resistance. Sterling holding up a bit better than some other currencies, notably the Philippine peso which over the weekend dropped to its weakest against the US dollar in 11 years forcing the central bank to come out on Sunday to defend it.
SHORT TERM TRADER: Square and looking for an interim base to form.
POSITION TAKER: Square.
EURO/US DOLLAR
Overbought yet holding up rather well close to this year’s highest level.
SHORT TERM TRADER: Long at 1.1740; stop below 1.1700. Target 1.2150.
POSITION TAKER: Square.
GOLD
Pushing up at the top of the broad band that has dominated since February as all precious metals get a lift from worries over North Korea.
SHORT TERM TRADER: Square.
POSITION TAKER: Square.
