Debating until late into the night on Sunday Democrats in the US Senate concluded they could not pass a bill to temporarily extend federal funding as it currently stands. They are expected to try to come to some arrangement when they meet at midday today and in the meantime, it is unclear whether federal employees should report to work or stay home.
Unless the shutdown can be sorted it may mean that President Trump might not manage to get to the World Economic Forum which starts in the Swiss town of Davos tomorrow and runs until Friday. This might come as a relief to some participants, others feel someone of his stature should not have to listen to lectures on how the US government should be run. One way or another US voices will be heard as by far the biggest contingent, with over 700 participants, is from the US.
DAX 30
Matching October’s record high weekly close and not as overbought on the RSI as it was then.
SHORT TERM TRADER: Short at 13290; stop above 13550. Target 12900.
POSITION TAKER: Square.
FTSE 100
Still struggling at the psychological 7700 and the MACD is bullish.
SHORT TERM TRADER: Square.
POSITION TAKER: Long at 7681; stop below 7645. Target 8000.
S&P 500
Gapping higher on last week’s opening and still terribly overbought. Remember, US dollar weakness means that foreign investors need big gains to compensate for FX losses.
SHORT TERM TRADER: Square.
POSITION TAKER: Square.
BRITISH POUND/US DOLLAR
Strong bullish momentum has ensured a weekly close above the Fibonacci 61 per cent retracement resistance level. We continue to favour further rallies to the next one.
SHORT TERM TRADER: New long at 1.3855; stop well below 1.3700. Target 1.4250.
POSITION TAKER: Long at 1.3730; stop well below 1.3700. First target 1.4000, then probably 1.4600.
EURO/US DOLLAR
Small signs of instability last week with a shooting star candle and an overbought euro.
SHORT TERM TRADER: Long at 1.2150; stop below 1.2140. Target 1.2575.
POSITION TAKER: Long at 1.2200; stop below 1.2100. First target 1.2600, then maybe 1.3000.
GOLD
Struggling just under long term trend line resistance levels but the weekly commodity channel index is yet to turn decidedly bearish.
SHORT TERM TRADER: Square.
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.
