At yesterday’s scheduled meeting in Frankfurt the ECB’s Mario Draghi stuck with recent vocab saying the economic outlook was ‘solid and broad-based’ despite the threat of trade protectionism remaining ‘prominent’. He also said that forward guidance – where bond buying would end this year and key rates remain unchanged until at least next summer – was ‘working well’.
The price of shares in Amazon closed 3 per cent higher yesterday on second quarter results. Net income rose twelve-fold to a record $2.5 billion, a third consecutive quarter of $1 billion-plus profits, and earnings per share of $5.07 were double those expected, an 1157 per cent increase Y/Y.
DAX 30
Bullish momentum picked up on yesterday’s rally while prices remain at levels first seen 14 months ago.
SHORT TERM TRADER: Stopped out yesterday afternoon and nursing a rather nasty loss.
POSITION TAKER: Square.
FTSE 100
Guttering around with zero momentum.
SHORT TERM TRADER: Square.
POSITION TAKER: Small short at 7799; stop well above 7800. First target 7400, then 7100.
S&P 500
Clearly overbought on the RSI despite making zero progress yesterday. Be wary of divergence between price action and oscillators.
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
Still struggling with trend line resistance.
SHORT TERM TRADER: Long at 1.3140; stop below 1.3000. Target 1.4000.
POSITION TAKER: Square.
EURO/US DOLLAR
Another currency struggling at current levels. Interesting to note that today James Daniel, of the IMF’s mission to China, said the yuan was ‘fairly valued’ and while praising the nation’s progress in reducing financial sector risks said credit growth was still unsustainably high.
SHORT TERM TRADER: Long at 1.1655; stop below 1.1600. First target 1.1850.
POSITION TAKER: Square.
GOLD
Momentum is still bearish regardless of recent consolidation inside a small right-angled triangle – usually a consolidation pattern.
SHORT TERM TRADER: Square.
POSITION TAKER: Short at 1242; stop above 1250. Target 1140.
