In an interview on CNBC yesterday following the market close, President Trump said, ‘’I think the Fed is making a mistake. I think the Fed has gone crazy…’’, possibly the third time he has lashed out at their raising of the Fed Funds target. Earlier in the day White House press secretary Sarah Sands had commented on how ‘incredibly strong’ the US economy was despite the stock market sell-off. But the real problem is that on the 3rd October Donald Trump gloated, ‘’the stock market just reached an all-time high during my administration for the 102nd time – a presidential record’’.
Data out today for September from UK RICS house price survey showed that surveyors were at their gloomiest since the Brexit referendum. This wasn’t helped by BoE Governor Carney’s quite frankly ridiculous comment last month that they could drop by 35 per cent within three years of a no-deal Brexit.
DAX 30
A big Marabuzo candle as we break through not one but two key ultra-long-term support levels (last at 11720) means the move’s got legs. See how they run!
SHORT TERM TRADER: New short on yesterday’s close at 11600; stop above 11885. Target 11200.
POSITION TAKER: Decided to hold on to my short position at 12100 as I knew I would be selling at the close; stop above 12000. My new target is 11200, the half-way mark of the rally that started late in 2016.
FTSE 100
Crashing through long term support at 7100 but still above this March’s low at 6840. Let’s see how long it takes to get there. Maybe longer than other indices as UK interest rates are expected to stay on hold for a while yet – unless the Bank of England decides to tinker.
SHORT TERM TRADER: Square but looking to re-sell on weak weekly closes.
POSITION TAKER: Short at an average above 7300; stop above 7225. Target 6925.
S&P 500
Business media rushing around for analysts’ views of a move that none of them saw coming.
SHORT TERM TRADER: New short at 2840 on yesterday’s break below the bottom of the right-angled triangle; stop above 2860. Target 2700.
POSITION TAKER: Square.
BRITISH POUND/US DOLLAR
Nice attempt at a little rally and mercifully calm among the equities carnage.
SHORT TERM TRADER: Long at 1.3075; stop below 1.3100. Target 1.3300.
POSITION TAKER: Square.
EURO/US DOLLAR
Tricky as the euro rallies back above the 1.1500 watershed area. Yesterday at the IMF meeting in Bali Klaus Regling, MD for the European Stability Mechanism, said it was unfair to compare Italy with Greece at the height of its debt crisis, CNBC reports. He noted that Italian sovereign debt was financed by relatively high private sector savings. Funny he should say that!
SHORT TERM TRADER: Square.
POSITION TAKER: Square.
GOLD
Not even a stock market rout can stir this comatose market.
SHORT TERM TRADER: Square.
POSITION TAKER: Short at 1194; stop above 1218. First target 1160.
