First quarter GDP in the Eurozone’s powerhouse slowed to 0.3 per cent quarter on quarter, equivalent to 1.6 per cent Y/Y, from 0.6 per cent and 2.3 per cent at the end of 2017. Better than many, agreed, but disappointing nevertheless. German statistics agency Destatis blamed it on the fact final government expenditure dropped for the first time in 5 years. Also, worth noting that both exports and imports were lower than Q4.
US retail banks may have curbed their willingness to lend on sub-prime auto loans. Instead the biggest US banks have dramatically increased their loans to the non-bank financial sector – which specialises in sub-prime auto, mortgage and consumer loans. Latest data suggest this stands at $344 billion, Wells Fargo the biggest with an estimated $81 billion. Simultaneously latest Fitch Autoloan delinquency rates are running at almost 6 per cent, higher than the 2008-2009 peak at 5 per cent and the highest on record.
DAX 30
Gently rolling over at the psychological 13000 area and has been overbought on the daily chart for a few days. Watch for better signs of forming an intermediate top.
SHORT TERM TRADER: Square.
POSITION TAKER: Square.
FTSE 100
As overbought as it was at the record high. Note that this morning UK employment data is due and many are hoping that for once wages run higher than inflation.
SHORT TERM TRADER: Square.
POSITION TAKER: New short at 7700; stop well above 7800. Target 7000.
S&P 500
Still trading under the old trend line having retraced a Fibonacci 61 per cent of the drop from the record high. Now bullish momentum looks as if it’s waning.
SHORT TERM TRADER: New short at 2725; stop above 2755. Target 2625.
POSITION TAKER: Square.
BRITISH POUND/US DOLLAR
Trying to form a rounded bottom against Fibonacci 38 per cent retracement support and the 50-day moving average. Bearish momentum has nearly evaporated completely and a break above 1.3700 will probably set off some short-covering.
SHORT TERM TRADER: Long at 1.3545; stop below 1.3400. Target 1.4100.
POSITION TAKER: Small long at 1.3565; stop below 1.3400. Target 1.4300.
EURO/US DOLLAR
Last week’s hammer candle set off yesterday’s little squeeze to the psychological 1.2000. A daily close above here should set off another little round of short-covering.
SHORT TERM TRADER: Long at 1.1910; stop below 1.1800. Target 1.2200.
POSITION TAKER: Long at 1.1910; stop below 1.1790. Target 1.2300.
GOLD
Re-testing the pivotal 1310 area yet momentum might turn bullish today. Safe-haven status might come into play as today Palestinian people remember Nakba Day, the Day of Catastrophe when Israel was carved out of their land. Those in Gaza will also be burying those shot at yesterday.
SHORT TERM TRADER: Tiny long at 1307; stop a bit below 1310. Target 1330.
POSITION TAKER: Long at 1320; stop below 1300. Target 1350.
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.
