Here we go again, the stalemate and mess that is US politics. Having been banging up against the debt ceiling for weeks, early today the Senate rubber stamped an agreement to borrow another $300 billion over the next two years. The deal now must go back to the House of Representatives who are expected to pass it today. If they get it done quickly enough, then Federal employees who were told their departments would be closed should turn up for work.
Yesterday the Investment Association reported that a record £63 billion of UK investors’ money had flowed into funds in 2017, taking money managed in these vehicles to £1.2 trillion. Interestingly they say that despite the current threat of higher interest rates, a mantra plugged by all too many for too long, fixed income funds the bestselling niche with £14.3 billion in sales.
DAX 30
Capped yesterday by what had been trend line support since June 2016, just under the 50 per cent retracement area that marked this week’s highs. A weekly close below 12000, which might be difficult today, would add another big dollop of bearish momentum.
SHORT TERM TRADER: Small short at 12535; stop above 12800. Target 11700. Might add to short position at tonight’s close.
POSITION TAKER: Short at 12650; stop above 12800. First target 12050, then probably more. Might add to short.
FTSE 100
US indices look like this one, Tuesday’s massive bounce from a ridiculous low capped at the half way area to the record high. A close below 7100 today would add to bearish pressure in this market that’s already skittish and skidding. In just two weeks we’ve pretty much undone all the work since January 2017.
SHORT TERM TRADER: Small short at 7225 and will add to this on a close below 7100 tonight; stop above 7400 (which will be lowered tonight). First target 7000.
POSITION TAKER: Short at 7260 and also looking to add to the position depending on tonight’s close; stop above 7400. First target 7050, then probably 6675.
S&P 500
The Dow Industrials looks like this, Wednesday’s squeeze capped at the Fibonacci 61 per cent from the record high and yesterday capped under the 50 per cent level. Yesterday’s close was exactly on trend line support taken from early November 2016. A weekly close below here would add to what have already been a ferocious bear market.
SHORT TERM TRADER: Small short at 2760 and will add to this position on a close below 2600 tonight; stop above 2705; first target 2550.
POSITION TAKER: Short at 2700; stop above 2725. First target 2545, probably 2455.
BRITISH POUND/US DOLLAR
Unhelpful noises from the Bank of England yesterday saw a brief rally fizzle out quickly. Now it’s time to watch what happens on the other side of the pond to se if US dollar weakness will persist this month.
SHORT TERM TRADER: Tiny long at 1.3975; stop below 1.3800. First target 1.4250.
POSITION TAKER:
EURO/US DOLLAR
Yesterday’s little doji at the 50 per cent level may stem bearish momentum.
SHORT TERM TRADER: Square.
POSITION TAKER: Square.
GOLD
Trying to hold on to 38 per cent Fibonacci retracement support with a little hanging man candle yesterday.
SHORT TERM TRADER: Small short at 1335; stop above 1347. Target 1280.
POSITION TAKER: Short at 1330; stop above 1350. Target 1250.
