Over the weekend finance ministers and central bankers from the world’s leading economies met in Buenos Aires, Argentina. Their statement noted the ‘heightened trade and geopolitical tensions’ and the risks to global growth which include ‘rising financial vulnerabilities, inequality and structurally weak growth, particularly in some advanced economies’. French finance minister Bruno Le Maire told reporters ‘’we refuse to negotiate with a gun to our head’’, aiming at US steel tariffs, while US Treasury secretary Mnuchin said, ‘’if Europe believes in free trade, we’re ready to sign a free trade agreement’’.
A heatwave has hit central Japan with temperatures soaring to over 40 degrees centigrade. At least 30 have died because of the heat and thousands are unwell.
DAX 30
A little shooting start last week against 12800 and a bearish MACD allows us to continue with our major head and shoulders top idea where we are building the right shoulder.
SHORT TERM TRADER: New short on Friday’s close at 12545; stop above 12800. First target 12200, then 12000.
POSITION TAKER: Square.
FTSE 100
The 8 successive doji-style weekly candlesticks is quite extraordinary and unlike anything I’ve seen in years. All bullish momentum has dissipated in the process.
SHORT TERM TRADER: Short at a couple of levels; stop above well 7710. Target 7400.
POSITION TAKER: Small short at 7799; stop well above 7800. First target 7400, then 7100.
S&P 500
Almost no price action last week has produced a tiny doji at the highest Fibonacci retracement level.
SHORT TERM TRADER: Tiny short at 2787; stop above 2880. Target 2600.
POSITION TAKER: Short at 2805; stop above 2900. Target 2555.
BRITISH POUND/US DOLLAR
A sort of a hammer weekly candle last week, holding against trend line support taken from the October 2016 low, has eased bearish momentum and hints that an interim low to the correction that started in April might be in place.
SHORT TERM TRADER: New long at 1.3140; stop below 1.2950. Target 1.4000.
POSITION TAKER: Square.
EURO/US DOLLAR
Finger pointing and accusations of being a currency manipulator have surfaced as politicians jockey for influence and a trading edge. The euro continues its glacial attempt at forming an interim base against the 50 per cent retracement area.
SHORT TERM TRADER: Long at 1.1655; stop below 1.1600. First target 1.1850.
POSITION TAKER: Still square but looking to go long.
GOLD
A hammer candle on the weekly chart against Fibonacci retracement support at 1216 suggests this interim low might hold again this week despite bearish momentum that is stronger than anything we’ve seen in almost 18 months.
SHORT TERM TRADER: Square.
POSITION TAKER: Short at 1242; stop above 1250. Target 1140.
