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Forex Market Analysis

June 19 – Global Stocks Slips on Risk off Sentiment – Trump Strikes

U.S. stocks slouched on Tuesday, with the Dow-Jones Industrial Average erasing its gains for the year, as markets were confused by a sharp escalation of the trade dispute between the United States and China. The US President, Donald Trump warned to impose a 10% tariff on $200 billion of Chinese goods and Beijing threatened it would retaliate.

S&P 500 – Daily Outlook

The U.S. stock market index SPX is trading at 2,664, down -15.25 points and -0.58%. The index is trading in the oversold zone and has already completed 50% retracement at 2,746. At the moment, SPX is likely to pull back to fill the early morning gap.



 

Support Resistance 
2761.79 2775.45
2757.58 2779.66
2750.75 2786.49
Key Trading Level: 2768.62

 

Nikkei – Daily Outlook

Japanese stocks plunged to 2-1/2-week lows on Tuesday and posted the biggest daily percentage decline in three months after Chinese stocks were sold piercingly amid intensifying global trade tussles.

Japan’s Nikkei dipped -401.85 points to trade at 22,278.48 on today. Most of the selling began in response to a risk-off sentiment. Technically, the Japanese index has come out of the asymmetric triangle pattern which supported Nikkei near 22,290. For now, the same level is working as a resistance. Whereas, the support is likely to prevail near 21,952.



Support Resistance 
22617.52 22774.72
22568.96 22823.28
22490.36 22901.88
Key Trading Level: 22696.12

That’s it for now, you are advised to monitor three speeches from the world central bankers. ECB President Draghi, BOJ’s Kuroda and Fed’s Chair Powell are due to participate in a panel discussion at the European Central Bank Forum on Central Banking, in Portugal on Wednesday at 13:30 (GMT). All the best!

Categories
Forex Market Analysis

Indices: Bull traders still could have space to go up?

Hot Topics:

  • Monitoring the indices alignment before a correction.
  • Euro group: weakness will continue against its main pairs.

Monitoring the indices alignment before a correction.

As we have said in previous daily updates, the markets are correlated, and big moves occur when they are all aligned. The FTSE 100 continues making a bullish extended cycle and is near to reaching critical levels for a reversal (7,500 to 7,600 area.)

In this session, for the fourth time, the DAX 30 couldn’t soar above the critical resistance level 12,622. It is likely that the German Index climbs up above the resistance before we expect it to fall.

Finally, as we can see, the NIKKEI 225 could still reach the area between the 22,620 to 22,800, before starting a corrective move. In conclusion, Indices still have space to see a new high, but we expect limited bullish moves.

Euro group: weakness will continue against its main pairs.

The Euro currency is developing a bearish move after the rally that started in 2017. The EURUSD pair continues the bearish cycle reaching the first blue box, testing the 1.2071 level. Before the Employment data release in the US, we expect a downward continuation to the zone between 1.1869 to 1.1815. From this area, it could start to bounce but it is too soon to foresee that move.

Looking at the Euro crosses, EURAUD is moving as we anticipated in our last Short-Term Pick (24th April), We expect the price to drop down to the region between 1.5748 and 1.5650. Invalidation level is at 1.6192.

EURCAD could not reach the 1.5811 zone; this situation makes us think that the bearish force could accelerate to our target level which is 1.54.

On the other hand in the money market, the USDCHF pair is still on an upward trend which is near to completing the bull cycle. In the zone between 0.9943 to 0.9993, the pair could make a new connector, then, start developing a bearish cycle.

The Pound has dropped to the 1.375 level, from where we expect the cable to start a bounce and make a consolidation move. The retracement could reach the area between 1.39 to 1.40. Invalidation level is at 1.4246.(c) Forex.Academy