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Daily Analysis: Nasdaq Hits New High as Pound Rebounds

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Daily Analysis: Nasdaq Hits New High as Pound Rebounds

Introduction

Wednesday Market Recap

Asset Current Value Daily Change
S&P 500 2369 0.45%
DAX 12274 0.08%
WTI Crude Oil 51.68 1.26%
GOLD 1249.85 -0.69%
Bitcoin 1120 -1.98%
EUR/USD 1.0660 -0.11%

 

Global stock markets were slightly lower again in early trading after a rebound during the Wall Street session yesterday. The previously strong DAX rolled over and it’s among the weakest indices so far today. US futures were also below their highs from yesterday, as the crucial levels that we have been monitoring for almost two weeks remain in focus. The much better than expected ADP employment report gave a boost to the market, especially the Nasdaq, but the rally looks increasingly “thin”, as only a few huge names carrying the major benchmarks to new highs, with giants like Amazon, Apple, Facebook, and Tesla have been seeing great inflows in the past week .

The Pound has its first positive session this week as the services PMI gave British traders something to cheer about following a slew of negative surprises in the last couple of days. Gold’s rally stalled near the $1260 level once again, while oil is still rallying, holding above the $50 per barrel level. The Yen also fell against its major counterparts today, as safe haven assets were under pressure.  The US Dollar has been trading sideways for three days now, but it didn’t give back virtually any of its gains against the Euro, with the pair still trading around the 1.0650 level.

Cryptocurrencies settled down somewhat after a crazy period, with Bitcoin’s negative move being the hottest topic among traders. BTC is down by 2% today, as it failed to clear the $1150 level so far this week. The other major altcoins are all in the green today as Dash, Litecoin, and Ethereum are up by more than 10%, while Monero and Ripple are also inching higher. Ripple found support near the 0.0350 level after the deep correction off its weekend highs.

Technical Picture

DAX, 4-Hour Chart Analysis

The DAX has been the leader of last week’s bounce, and it reached new highs before way ahead of the other global indices. The 4-hour chart shows that the German benchmark broke out of an already rising trend channel, getting close to the 12,400 level earlier on this week. The DAX is now testing the upper boundary of the previous channel and the 12,150-12,200 support zone. Should the index fail to hold above the zone, a re-test of the lower boundary of the channel is likely.

Key Economic Releases on Wednesday

Time, CET Country Release Actual Expected Previous
10:30 UK Services PMI 55 53.5 53.3
14:15 US ADP Employment Change 263,000 225,000 298,000
16:00 US ISM Non-Manufacturing PMI 55.2 57 57.6
16:30 US Crude Oil Inventories 1.6 million -0.1 million 0.9 million
20:00 US FOMC Meeting Minutes

 

Key Economic Releases on Thursday

Time, CET Country Release Expected Previous
8:00 GERMANY Factory Orders (monthly) 3.50% -0.80%
13:30 EUROZONE ECB Meeting Accounts
14:30 CANADA Building Permits (monthly) 5.40%
14:30 US Initial Jobless Claims (weekly) 251,000 258,000

 

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Mate Cser

Mate Cser

Trader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.

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