Published this week the CBI PwC Q2 2019 services sector survey showed that economic growth expectations were at their lowest since 2008, troubling as this makes up 80 per cent of the British economy. Optimism in the business and professional area, which includes legal, accountancy and marketing, fell to -31 at the end of June versus -8 in Q1 and the outlook for the next 12 months collapsed to -51. Consumer services, like hospitality, travel and leisure dropped to -28 from -12.
Relatively new Greek PM Kyriakos Mitsotakis of the conservative New Democracy party said yesterday in parliament that as of 1st September 2019, all capital controls on the country would be lifted; stringent limits on international money flows had been imposed in 2015, and lifted gradually since then. The idea is to improve investor confidence in the country and stabilise the banking system, where sovereign debt is currently rated below investment grade.
DAX 30
Last week’s gravestone doji hasn’t added to bearish momentum and the index continues to consolidate above the 50 per cent retracement support level.
SHORT TERM TRADER: Short at 11645; stop above 11865. Next target 11200.
POSITION TAKER: Short at 11835; stop well above 11865. First target 11000.
FTSE 100
Momentum isn’t as bearish as one might expect considering the index has given up a Fibonacci 61 per cent of this year’s gains.
SHORT TERM TRADER: Small short at 7145; stop well above 7200. Target 6850.
POSITION TAKER: Short at 7570; stop above 7325. Target 7000, maybe 6865.
S&P 500
Consolidating in a small symmetrical triangle just under the record high and during this time the MACD has turned bearish. City AM reports this morning that the wealth management arm of Swiss bank UBS has recommended its clients shift to ‘underweight’ in stocks because of the Sino-US trade war. Its CIO added that they are ‘’not bracing…for a traditional recession’’.
SHORT: Small short at 2910; stop above 2970. Target 2820.
POSITION TAKER: Short at 2915; stop above 2970. First target 2820.
BRITISH POUND/US DOLLAR
The commodity channel index continues in its attempts at putting in some sort of base, but don’t hold your breath as its been doing so since early May.
SHORT TERM TRADER: Small long at 1.2135; stop below 1.2050. Target 1.2380.
POSITION TAKER: Another tiny long at 1.2290; stop below 1.2000. Target 1.2580.
EURO/US DOLLAR
Not floundering, but hardly thriving, as has been the case since Q4 2018.
SHORT TERM TRADER: Small long at 1.1165; stop below 1.1060. Target 1.1340.
POSITION TAKER: Square.
GOLD
Chinese investors are certainly buying gold and silver futures contracts in Shanghai, and spot gold is now more overbought than it has been on a weekly basis since 2007.
SHORT TERM TRADER: Stopped out at another loss. Will I ever learn?
POSITION TAKER: Square.
