Today the US Federal Reserve’s rate-setters meet and, following initially surprising then more extensive trimming of the Fed Funds target last year, will probably keep things as they are at 1.75 per cent. Mind you, the bond market is as always marching to its own tune, currently anticipating an extension into longer maturity repos in what the Fed insists is not QE at the discount window. However, the Congressional Budget Office estimates that within the next decade US national debt will rise to 98 per cent of GDP, its highest since WWII. Tomorrow the Bank of England’s MPC meets and rates are also likely to remain on hold at 0.75 per cent.
British Airways has cancelled all flights to China and US authorities are considering doing the same. The death toll from the coronavirus has risen again, currently 132, and the number of confirmed cases stands at about 6000 – which the BBC says is higher than the peak during 2003’s SARS virus outbreak which reached 5327 in mainland China and 349 killed.
DAX 30
Bouncing back up to the bottom of this month’s small broadening top chart pattern, while keeping turned momentum bearish.
SHORT TERM TRADER: Short at 13460; stop above 13600. Target 13000.
POSITION TAKER: Square.
FTSE 100
Another index bouncing a bit, this one to the bottom of the double top which built up over year-end. Here too momentum is (clearly) bearish.
SHORT TERM TRADER: Short at 7470; stop above 7650. Target 7200.
POSITION TAKER: Square.
S&P 500
Bouncing to close the gap opened up Monday while keeping momentum (only just) bearish.
SHORT TERM TRADER: Short at 3260; stop above 3350. Target 3100.
POSITION TAKER: Square.
BRITISH POUND/US DOLLAR
Snaking sideways along Fibonacci 38 per cent retracement support.
SHORT TERM TRADER: Small long at 1.3075; stop below 1.2900. Target 1.3500.
POSITION TAKER: Square.
EURO/US DOLLAR
Yesterday’s little hammer-style doji is unlikely to be able to stem this month’s steady slide.
SHORT TERM TRADER: Square.
POSITION TAKER: Square.
GOLD
Another market filling the gap opened up on Monday.
SHORT TERM TRADER: Small long at 1578; stop well below 1540. Target 1610.
POSITION TAKER: Square.
