December trade data from China published this morning shows exports grew 10.8 per cent and imports by a whopping 18.7 per cent this year taking this month’s trade surplus to 362 billion yuan (highest in a year). The surplus with the US set a record at $275 billion while imports from North Korea slumped by 81 per cent. Demand for commodities continues to rise with new records set for crude oil and iron ore imports.
As is the fashion in the European Union, talks between politicians drag on through the night on the very last deadline date. This has been the case last night with Chancellor Angela Merkel who, three months after managing the poorest election result for the CSU party which she heads up, is still trying to form a government. Allegedly fuelled by currywurst, she is in the process of negotiating with the SPD whether to launch formal talks to form a grand coalition (having failed at her previous attempt at wooing two other political parties).
DAX 30
Dipping briefly back inside the 12900 to 13200 range that has dominated since November with much media hype surrounding the ‘increased level of confidence’ of ECB rate-setters and that bond yields were rising. Careful who you listen to.
SHORT TERM TRADER: Short at 13290; stop above 13550. Target 12900.
POSITION TAKER: Square.
FTSE 100
Another new record high even as ex-head of UKIP Nigel Farage suggests he’d be open to the idea of holding a second referendum. Calling Mrs May’s bluff?
SHORT TERM TRADER: Square.
POSITION TAKER: Long at 7681; stop below 7645. Target 8000.
S&P 500
Powering ahead for a second consecutive week this year, potentially putting in 10 consecutive daily rallies. Remember the Rule of 8-10!
SHORT TERM TRADER: Square.
POSITION TAKER: Square.
BRITISH POUND/US DOLLAR
False dip below first Fibonacci retracement support at 1.3478 has resulted in a spike low.
SHORT TERM TRADER: Long at 1.3540; stop below 1.3470. First target 1.3800.
POSITION TAKER: Square.
EURO/US DOLLAR
Back up testing last year’s high at 1.2100, just ahead of the 50 per cent retracement level at 1.2150, potentially forming a strong hammer candle on the weekly chart.
SHORT TERM TRADER: Square.
POSITION TAKER: Will buy on weekly closes above 1.2100 and 1.2150.
GOLD
Not going according to plan as US dollar weakness pulls the spot price higher.
SHORT TERM TRADER: Short at 1314; stop above 1335. Target 1270.
POSITION TAKER: Short at 1317; stop above 1360.
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.
