Equities Waiting On Key Dollar Data
Global equities benchmarks have started the week in a rather muted fashion amidst quiet summer trading. However, most indices are holding around recent highs for now, reflecting the better tone to risk appetite over recent weeks. With the USD rally fizzling out of late and the focus remaining on the global reopening effort, asset markets have managed to hold onto gains for the most part, keeping the near term bias skewed towards further upside.
On the data front this week there are some key readings to note, which might cause market volatility. Chief among these is the June US CPI release due later today. The market is looking for a slight fall in both the headline and core readings to 0.5% and 0.4% respectively from the prior month’s 0.6% and 0.7% respectively. If today’s data does confirm a d decrease in price pressures, this will further take the wind out of the Dollar’s sails, allowing equities to continue higher for now. However, should we see any surprise upside in today’s data, this will likely reignite Fed tightening expectations, dragging equities lower as USD advances.
Technical Views
DAX
The DAX has broken out to fresh highs this week with the index moving above the 15743.01 level. With MACD and RSI both bullish, the focus is on further upside here. Any drop below the 15743.01 level, however, will turn attention to the 15486.96 level next.
S&P500
The rally in the S&P has seen the index breaking out tofresh highs this week with price sitting atop the 4353.25 level now. Supportedby both the MACD and RSI, the focus remains on further upside in the near term.Should we see any correction, the rising trend line and 4295.75 level are thenext support areas to note.
FTSE
The rally in the FTSE has seen price trading back up to retestthe 7137 level. RSI is positive here with the MACD close to turning bullishalso, keeping the focus on further upside for now. To the topside, 7241 is thenext level to note while 6968.7 is the main support on any drop lower.
NIKKEI
The Nikkei is attempting to break higher here though price is so far being capped by the bearish channel top. RSI is positive, with MACD close to turning positive, keeping the focus on further upside here, with 29479.7 the next topside level to note. To the downside, 27422.9 is the main support to note.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.