Tech darlings, many of which have driven US indices higher over the last year, suddenly got cold feet. Facebook first, now Tesla too – hitting the lowest price in almost a year – on a downgrade from Moody’s, Alphabet and Amazon off by 4 per cent, Netflix 6, Twitter a massive 12 per cent lower on expectations of further regulation on its social media platform.
After leaving Beijing with his wife, it was announced that North Korean leader Kim Jong Un had spent three days in China on an unofficial visit. It is believed to be his first trip abroad since taking over from his father 7 years ago. Chinese state news agency Xinhua says he pledged to denuclearise the Korean peninsula while Xi Jinping said he would uphold the friendship between their two countries. Others say it was a dry run ahead of the summit with President Trump.
DAX 30
Yesterday’s shooting star candle against the pivotal long term area around 12000 has maintained bearish momentum and might set up for a weekly close below 11700 in this holiday-shortened week.
SHORT TERM TRADER: Short at 11800; stop above 12200. Target 11400.
POSITION TAKER: Short at 11800; stop above 12400. Target 9500.
FTSE 100
Strange that yesterday’s fairly dramatic shooting star candle was unable to maintain bearish momentum. City AM reports that research from broker AJ Bell has only 29 of the FTSE 100 original members in the index today 34 years since inception, though 13 of these are currently trading under a different name.
SHORT TERM TRADER: Small short at 7055; stop above 7100; target 6700.
POSITION TAKER: Short at 6850 and at higher levels; stop above 7100. Target the 6675/6700 area.
S&P 500
Long term trend line support has now become resistance as we saw with yesterday’s categorical rejection and large red Marabuzo candle. Bearish momentum is nearly as strong as it was early February.
SHORT TERM TRADER: Small short at 2675; stop above 2800. Target 2585.
POSITION TAKER: Thinking of selling depending on tomorrow’s close.
BRITISH POUND/US DOLLAR
The charts are still a bit of a mess due to Monday’s gaps in prices. Yesterday’s hanging man type candle underlines the fact that we approach this year’s high at 1.4345 with trepidation. We will want to watch for strong weekly, monthly and quarterly closes to confirm the next bout of generalised US dollar weakness.
SHORT TERM TRADER: Square.
POSITION TAKER: Square.
EURO/US DOLLAR
A break above this year’s triangle consolidation to a new high doesn’t look as though it’s going to be a walk in the park. Careful.
SHORT TERM TRADER: Square.
POSITION TAKER: Small long at 1.2270; stop below 1.2250. Might close the position ahead of target at 1.2500.
GOLD
Stalling once again around this year’s highs. Tempted to go short despite its safe-haven status as other precious metals have interim highs in place this month.
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.
