As he was flying into London for a 70th NATO summit and a reception with the Queen at Buckingham Palace today, President Trump announced new tariffs on US imports of Argentine and Brazilian aluminium and steel. This was because their currencies are at their weakest ever against the US dollar, giving their exporters an unfair advantage. In parallel US trade representative Robert Lighthizer was considering slapping tariffs of up to 100 per cent on French luxury goods, including champagne, cheese and handbags. Then on Fox Business commerce secretary Wilbur Ross warned China that if a trade deal wasn’t signed by the 15th of this month tariffs would be ramped up again.
One of Italy’s biggest banks, Milan-based UniCredit SpA, announced a new 4-year strategic review aimed at eking out profits and returning money to shareholders, reports Bloomberg. CEO Jean Pierre Mustier plans €2 billion in share buy-backs, closing 500 branches and shedding 8000 (over 9 per cent of the workforce) jobs.
DAX 30
December didn’t get off to a good start but at least the market moved, at last, immediately turning momentum bearish.
SHORT TERM TRADER: Short at 13200; stop above 13375 with a target at 12335.
POSITION TAKER: Square.
FTSE 100
A fairly comprehensive rejection at the 7400 area yesterday, complete with spike high, yet oscillators remain mixed.
SHORT TERM TRADER: Short at 7370; stop above 7445. Target 7175.
POSITION TAKER: Short at 7300; stop above 7435. Target 7100.
S&P 500
Yesterday’s sell-off has done a lot to correct the overbought situation. More importantly it suggests that the move above the top of the upper broadening top’s edge was a false break and isn’t sustainable.
SHORT TERM TRADER: New small short at 3112; stop above 3160. Target 2975.
POSITION TAKER: Square.
BRITISH POUND/US DOLLAR
Trying to push higher but so difficult when bullish momentum is so low.
SHORT TERM TRADER: Small long at 1.2950; stop below 1.2800. Target 1.3350.
POSITION TAKER: Long at 1.2950; stop below 1.2750. Target 1.3350.
EURO/US DOLLAR
Bouncing by more than expected creating the conditions for a potential small double bottom.
SHORT TERM TRADER: Short at 1.1050; stop above 1.1100. Target 1.0930.
POSITION TAKER: Square.
GOLD
Back to boring as prices consolidate in a tight range just under the previous long, drawn-out range trading.
SHORT TERM TRADER: Short at 1520; stop above 1500. Target 1440.
POSITION TAKER: Short at 1507; stop above 1520. Target 1440.
