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Risk was back last night, as overseas markets reversed their sideways funk and bids were finally made to push undollar assets above their resistance levels. In Europe, good data from France and Germany gave the impetus for the biggest rises, whilst in the USA, the beginning of the US corporate earnings season, with a loss-making Alcoa, whilst providing a positive outlook saw some more modest bids.

In detail:

The UK FTSE jumped 84 points or 1.5% to finish at 5696 points, but has yet climbed above its resistance level at 5700 points, whilst the German DAX was even better, up 2.47% to finish at 6162 points, climbing just above strong resistance (but not its 200 DMA) and presenting a mildly bullish case for a continued runup:


The Euro (EUR/USD) saw relatively light bids, and climbed up to nearly 1.28 against the USD. It is currently trading at 1.2775, as the USD Index lost 0.3 points, but still above the 81 point level and critically, its support level around 80 points:

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US markets were all bid up with the tech heavy NASDAQ leading the charge, up almost 1% to 2702, the broader industrial S&P500 not far behind, up 11 points or 0.9% to 1292, and the Dow Jones gaining 70 points or just over half a percent to 12462.

This is a new 5 month high for the S&P500 and it has just broken above strong overhead resistance at 1285 points, providing a very bullish case, more so than the European bourses (and thus continuing the consensus view of a US recovery) for a return to the pre-correction high at 1363 points:


The AUD went above 1.03 overnight, currently at 1.0314 against the USD, slipping in early trade, while it remains over 80 cents against the Euro, currently at 80.7 against the “gold” like union currency.

To commodities, and WTI crude, was bid up almost $1 a barrel to $102.24, with Brent crude reacting similarly, up to $113.29 USD per barrel.

On Twitter yesterday I posted a chart showing that both crude markets have converged to resemble each other again in magnitude (but not price), likely on the Iranian tensions.

There are some definite trading ideas coming out of both of these commodity futures…

Gold traders finally saw evidence of a resurgence in the shiny metal, rising above its resistance level at $1620, which is also its 200 day moving average (a very closely watched long term average). It rose as high as $1640USD an ounce, until finishing at $1632, waiting for the open of the Asian session.

Again, another trading idea likely to come out of this “gold rush”, with an intermediate target of approx. $1680USD an ounce:

Other metal commodities were strongly bid up – in fact, this is reminiscent of pre-QE2 times last year, with aluminium up another 2.4%, copper jumping up nearly 3% in what looks like a clear breakout, and nickel also bid up strongly, up nearly 2%, rallying from an oversold bottom.

The Aussie SPI Futures point to a higher open for the S&P/ASX200 index, currently up approx. 15 points, probably opening around the 4165 points level.

Trading Day will cover the Asian market session and the “ASX8” stocks after the close in the afternoon.

www.twitter.com/ThePrinceMB