As promised in his election campaign, President Trump says he will impose a 10 per cent import tax on aluminium and a 25 per cent one on steel, where the US is the biggest importer in the world. Interested nations reacted predictably. Interestingly the Benelux Customs Union entered into force in 1948, a pre-cursor to the EEC, and was created to protect the coal and steel industries of Belgium, the Netherlands, and Luxembourg.
In a State of the Union address yesterday President Putin announced a raft of new defence systems, including a prototype missile that ‘can reach any point in the world’; if Russia were attacked, he said he is prepared to use nuclear weapons. As the missile and subsurface unmanned vehicle did not have names yet, he urged (joking) delegates to submit suggestions via the Defence Ministry website, reports CNBC.
DAX 30
Re-testing important horizontal support at 12000 with momentum turning bearish on yesterday’s close. A weekly close below here would add to bearish pressure and may add to the onslaught on Monday depending on how the SPD’s electoral vote goes on Sunday, where the vast majority of German voters feel they are unfit for government. Also, eyes on Sunday’s general election in Italy.
SHORT TERM TRADER: Small short at 12535; stop well above 12400. Will add to the short position on a weekly close below 12000 tonight keeping the target at 11700.
POSITION TAKER: First target at 12050 met and partial profits taken. Will re-sell tonight on a weekly close below 12000.
FTSE 100
Back down on very important horizontal support at 7100 and momentum turned bearish on yesterday’s close. A weekly close below here would add to what is already a top-heavy chart pattern.
SHORT TERM TRADER: Small short at 7180; stop above 7325. Will add to position on a close below 7100 tonight keeping the target at 7000.
POSITION TAKER: Short at 7250; stop above 7325. Target the 6675 area.
S&P 500
Re-testing trend line support taken from the November 2016 low, where a weekly close below here might add to bearish momentum.
SHORT TERM TRADER: Small short at 2720; stop well above 2740. Target 2550.
POSITION TAKER: Will sell on weekly closes below 2620 and 2600.
BRITISH POUND/US DOLLAR
Yesterday’s little hammer candle, combined with a fairly extreme reading on the commodity channel index, hints that the dip below 1.3800 just might turn out to be a false break.
SHORT TERM TRADER: Square.
POSITION TAKER: New small long on yesterday’s close at 1.3775; stop below 1.3600. Target 1.4250.
EURO/US DOLLAR
As we had suspected and just what the doctor ordered. The blip below the trend line and the 1.2200 level was a false break and an opportunity to shake out flaky longs. The current range between 1.2200 and 1.2500 will hold, as evidenced by the commodity channel index.
SHORT TERM TRADER: Small long at 1.2267; stop well below 1.2200. Target 1.2500.
POSITION TAKER: New small long at 1.2270; stop well below 1.2200. Target 1.2500.
GOLD
A massive dragonfly doji at the 1310 area underlines how technically important this chart area, ahead of the psychological 1300, is currently seen as. Meanwhile the MACD didn’t bat an eyelid and is resolutely bearish.
SHORT TERM TRADER: Might consider selling on a close below immediate support.
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.
