This morning Reuters reports that the People’s Bank of China announced that, for the first time ever, it will issue yuan-denominated Treasury bills from Hong Kong; a tranche of 10 billion yuan ($2.44 billion) with a three-month maturity and another 10 billion maturing in a year’s time. The ex-colony is the world’s biggest off-shore yuan clearing centre and the move aims to expand the range of top-rated products available, and the ability to control the shape of the yield curve.
Britain’s Insolvency Service reports that company bankruptcies increased by 19.3 per cent in Q3 2018 compared to this time last year, writes City AM. A total 4308 companies folded, 71 per cent as creditors’ voluntary liquidations; this is the highest quarterly drop-out rate since 2014. The construction sector saw the biggest number of insolvencies, followed by wholesale and retail trade.
DAX 30
Though we may have broken above immediate trend line resistance this morning the picture remains pretty much unchanged from yesterday: price action remains under first Fibonacci retracement resistance and might be another inverted flag. Data this morning for German September retail sales saw them collapse by 2.7 per cent Y/Y, the lowest reading in at least 3 years.
SHORT TERM TRADER: Short at 11200; stop above 11755. Target 10400.
POSITION TAKER: Short; stop above 11700. Next target at 10700.
FTSE 100
Retracing a Fibonacci 38 per cent of October’s decline, helped a little by the weaker pound.
SHORT TERM TRADER: Short at 7025; stop above 7125. Target 6400.
POSITION TAKER: Short at 7075; stop above 7125. First target 6800.
S&P 500
Momentum still bearish despite yesterday’s bounce and controversial bullish engulfing candle. Yesterday GE announced it would cut its dividend to a token $0.01 per share after losses of $2.63 per share in Q3 2018. Facing serious restructuring, the company announced that federal regulators had opened a criminal probe into its accounting practices. The share price dipped below $10.00 for the first time since 2009.
SHORT TERM TRADER: Square and looking to re-sell.
POSITION TAKER: Square and reviewing the situation.
BRITISH POUND/US DOLLAR
Back down at August’s lows and this year’s weakest level and oversold on the RSI. Look for attempts at basing again.
SHORT TERM TRADER: Square.
POSITION TAKER: Square.
EURO/US DOLLAR
Another one bumping along the bottom at this year’s lowest prices and oversold.
SHORT TERM TRADER: Square.
POSITION TAKER: Square.
GOLD
Bullish momentum fading fast as we appear to have stalled against 50 per cent retracement of the most recent drop.
SHORT TERM TRADER: Tiny short at 1227; stop above 1240. Target 1190.
POSITION TAKER: Square.
Nicole Elliott is a long-standing member and Fellow 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.
