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Bullishness has returned to equities after a favourable first round French election outcome. Clearing another political hurdle is welcome – Macron expected to win the run-off by much bigger margin in a fortnight – but uncertainty lies with June parliamentary elections and who’ll work with him as an independent.
The resulting stronger EUR would normally hinder the French CAC and German DAX, but a surge by banks on reduced concern about a Le Pen win and ‘Frexit’, coupled with Macron being pro-banks/business, is helping offset this.
Trump tax cut hopes have also rekindled some optimism (along with oil prices off their lows) but there is the risk that the US President merely updates us on plans and hopes rather than concrete progress which is what markets want, even need. All the while corporate earnings continue to come thick and fast.
The UK’s UK Index is gaining thanks to Oil majors (oil bounce), Banks (French election), Miners (risk assets) and US exposed markets (CRH, DGE, BATS). German’s DAX is being led by its banks and internationally exposed names.
The UK Index 100 has delivered bullish breakouts (7150, 7220) to re-test last week’s 7250 breakdown. The DAX 30 has rallied back above 12400 to record a fresh all-time high. Dow Jones Futures have broken above 20700 thanks to a bullish flag pattern we highlighted last week. Gold is back around $1270 amid revived risk appetite and thus reduced risk aversion.
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The UK Index 100 has delivered to bullish breakouts (7150, 7220) to re-test last week’s 7250 breakdown. Bullish flag forming? Note RSI now overbought.
Watch levels: Bullish 7260; Bearish 7220
Solid Green line
Possible support
Solid Red line
Possible resistance
Important: The information provided above does not constitute advice or opinion and must only be regarded as technical observations.
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The DAX 30 has rallied back above 12400 to record a fresh all-time high at 12415. Lagging peers by almost 2 yrs, can it power on? RSI overbought, but it could easily stay there. Any EUR reversal would help.
Watch levels: Bullish 12415; Bearish 12385
Solid Green line
Possible support
Solid Red line
Possible resistance
Important: The information provided above does not constitute advice or opinion and must only be regarded as technical observations.
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Dow Jones Futures have broken above 20700 thanks to a bullish flag pattern we highlighted last week. Can it power on, back to the highs?
Watch levels: Bullish 20,800; Bearish 20,750
Solid Green line
Possible support
Solid Red line
Possible resistance
Important: The information provided above does not constitute advice or opinion and must only be regarded as technical observations.
Click here for help with Support & Resistance Click here for help with technicals
Gold is back around $1270 amid revived risk appetite and thus reduced risk aversion. The gap down overnight keeps it in a downtrend since recent highs.
Watch levels: Bullish $1274; Bearish $1269
Solid Green line
Possible support
Solid Red line
Possible resistance
Important: The information provided above does not constitute advice or opinion and must only be regarded as technical observations.
Click here for help with Support & Resistance Click here for help with technicals
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