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Market Outlook: Angela’s ashes

Coalition talks break down
November 20, 2017

Last night Germany's Christian Democrats' main alliance hopeful the Free Democrats (FDP) walked out of talks that included the Greens saying, "it’s better not to govern than to govern badly." Both the Chancellor Angela Merkel and the German Chambers of Commerce said they were disappointed by this.

Embattled Japanese firm Toshiba, with billions of dollars of liabilities linked to its US nuclear power operations, has decided to issue 600bn yen (£4bn) in new shares to 60 overseas investors. This will result in earnings per share halving but it also means that the company will not face delisting from the Tokyo Stock Exchange.

DAX 30

Back to where we were a month ago, as the bullish MACD loses steam.

 

SHORT TERM TRADER:  Short at 12960; stop above 13225.  First target 12700.

 

POSITION TAKER:  Square still as Friday’s close was too close to 13000.

FTSE 100

The MACD turning bearish on Friday’s close, as it has been most of the time since April.  Nothing especially illuminating in the weekly candles, but is another index back to where we were a month ago – and where we were in March.

 

SHORT TERM TRADER:   Short at 7470; stop above 7480.  Target 7125.

 

POSITION TAKER:  Square.

S&P 500

Such tiny little weekly doji candles as the MACD loses steam here too.  All looking rather fragile.

 

SHORT TERM TRADER:  Short at 2565; stop above 2615.  First target 2515 and more realistically 2460.

 

POSITION TAKER:  Square.

BRITISH POUND/US DOLLAR

Momentum remains a little bullish, as it has been since March, as we inch our way up a tad helped by the rising trend line.  

 

SHORT TERM TRADER:  Long at 1.3155; stop below 1.3080.  Target 1.3300.

 

POSITION TAKER:  Square.

EURO/US DOLLAR

Bouncing quite sharply from the watershed level around 1.1600 though momentum is bearish.  A report by the ECB on revisions to the Union crisis management framework stated: ‘covered deposits and claims under investor compensation schemes [€100,000] should be replaced by limited discretionary exemptions to be granted by the competent authority in order to retain a degree of flexibility’.   

 

SHORT TERM TRADER:  Square.

 

POSITION TAKER:  Square.

GOLD

Bouncing from Fibonacci 38 per cent retracement support potentially forming a third interim higher low point this year.

                            

SHORT TERM TRADER:  Square.

 

POSITION TAKER:  Square.

Nicole Elliott is a long-standing Member of the Society of Technical Analysts and has taken over 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.