At a press conference yesterday Liu Xiaoming, Britain’s Chinese ambassador, warned that Hong Kong cannot fall into a ‘’dangerous abyss’’ by protestors who are showing ‘’signs of terrorism’’. Adding that his government ‘’will not sit on its hands’’, that ‘’we are fully prepared for the worst’’ and that they have the ‘’power to quell unrest’’. Meanwhile it’s estimated that Hong Kong’s super-rich have lost the equivalent of US $15 billion recently, laying bare the huge increase in inequality in the territory since 1997. Now prominent HK activist Chen Haotian has urged citizens to withdraw all their bank deposits from commercial banks today, causing a run on financial services.
Penned by Harry Markopolos, the man who uncovered Madoff’s Ponzi scheme, and published yesterday by Forensic Decisions PR, a report suggests that US giant GE is insolvent. Alleging the company’s financial filings were hiding potential debt of US $38 billion, which would put the firm’s debt-to-equity ratio at 17:1 instead of the stated 3:1, shares on Wall Street slumped by 11 per cent.
DAX 30
A brief spike below 11400 and settling above that might be seen as a positive sign by the bulls. I feel it isn’t, that yesterday’s long-legged doji is yet another sign of serious instability in this index, and that we are set to settle on a weekly basis below the 200-day moving average at 11650. Note that this week Citi Bank has put out a report saying that German banks are in a far worse position than others in Europe.
SHORT TERM TRADER: Short at 11645 and considering adding to this position this evening; stop above 11865. Next target 11200.
POSITION TAKER: Short at 11835; stop well above 11865. First target 11000.
FTSE 100
Bearish momentum eased very marginally yesterday as this index struggles to hold around June’s low. Note that the 200-day simple moving average lies at 7190 and a close below here tonight might set off another round of selling next week.
SHORT TERM TRADER: Took profit just ahead of target at 7000 yesterday and now considering a bigger short position depending on today’s close.
POSITION TAKER: Short at 7570; stop above 7350. Target 7000, maybe 6865.
S&P 500
Action, inaction and rhetoric of politicians all over the world is just too depressing to read about – let alone having to navigate financial markets against this background. Here, bearish momentum has eased again while the Russell index is doing a lot worse than the others.
SHORT: Short at 2885; stop above 2905. First target 2785.
POSITION TAKER: Square.
BRITISH POUND/US DOLLAR
Scraping itself up off the bottom, the MACD bravely trying to turn bullish, gaining a penny and a half against the euro in the process.
SHORT TERM TRADER: Square.
POSITION TAKER: Square.
EURO/US DOLLAR
Very disappointing and now the MACD is threatening to turn down.
SHORT TERM TRADER: Small long at 1.1165; stop below 1.1060. Target 1.1340.
POSITION TAKER: Square.
GOLD
Holding up quite well at this year’s highest levels even though it’s overbought. Have a funny feeling that we might be making another, much smaller, right-angled triangle.
SHORT TERM TRADER: Small short at 1500; stop above 1535. Target 1440.
POSITION TAKER: Square.
