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Market Outlook:Swiss Q2 GDP grows a meagre 0.2 per cent Y/Y

Admittedly, we had prepared for a global slowdown

Data published early this morning showed Swiss second quarter GDP grew at 0.3 per cent Q/Q but slumped from one per cent growth to just 0.2 per cent annualised. One of the most established, reliable economic engines in Europe, this is the weakest it’s been since 2009.

Also, released early today, the bad news from German industry accelerates: factory orders slumped again from -3.6 per cent in June to -5.6 per cent annualised in July. The economy ministry noted, ‘’in the light of ongoing international trade conflicts and modest business expectations in manufacturing, no fundamental improvement is in sight for the coming months’’. Bloomberg helpfully points out that this development raises the risk of recession in the EU’s powerhouse.

DAX 30

Retracing a Fibonacci 61 per cent of August’s initial decline as bullish momentum remains steady. This was caused, as in global stock markets, by the announcement that Sino-US trade talks would resume in October.

 

SHORT TERM TRADER: Square.

 

POSITION TAKER:  Square.

FTSE 100

Retracing exactly half of the most recent declines and faces a large, descending bearish daily Ichimoku cloud through to the end of this month.

 

SHORT TERM TRADER:   Square.

 

POSITION TAKER:  Stopped out here too this morning but took a hefty profit on the original position.

S&P 500

Not overbought and no bullish momentum yet the index has retraced a Fibonacci 76.4 per cent and has re-tested horizontal support extended from the base of July’s broadening top. We have a potential shooting star candle today, but must wait to see where we settle. Interesting as the Financial Times reports this morning that the world’s 12 largest investment banks saw revenue from operations in the first half of this year drop 11 per cent from last year, the slowest start to any year since 2006.Interesting as the Financial Times reports this morning that the world’s 12 largest investment banks saw revenue from operations in the first half of this year drop 11 per cent from last year, the slowest start to any year since 2006.

 

SHORT TERM TRADER: Small short at 2910; stop above 2970. Target 2820.

 

POSITION TAKER:   Short at 2915; stop above 2970. First target 2820.

BRITISH POUND/US DOLLAR

A lesson in the power of a hammer candle, even if it’s small, and especially after our warning that the dip below 1.2000 was highly likely to be a spike ow and false beak. Soaring yesterday to settle above the two descending trendlines, but bullish momentum is pathetic.

 

SHORT TERM TRADER:  Long at 1.2150; stop below 1.2030. Raised mt target to 1.2375.

 

POSITION TAKER:  Square.

EURO/US DOLLAR

Rallying more than hoped for yesterday and managing to turn the commodity channel bullish.  

 

SHORT TERM TRADER:  New long at 1.1030; stop below 1.0950. Target 1.1150.

 

POSITION TAKER:  Square.

GOLD

Such a lot of divergence on this chart yet it’s still holding neatly in a $40 range.

                            

SHORT TERM TRADER:  Square.

 

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.