Pre Market: Stocks Mixed after Syrian Missile Attack

After Friday’s nervous trading session that was overshadowed by fears that the Syrian conflict will escalate further, Saturday’s “contained” missile attack actually helped investor sentiment and caused a bounce in US equity futures. Asian and European markets are lagging their US peers, with especially Chinese stocks looking weak today.

Shanghai Composite, 4-Hour Chart Analysis

The recently outperforming DAX is still struggling clear the resistance zone near 12,500, and the setup continues to look favorable to enter short positions for those who expect further losses after the recent deep correction.

DAX Index, 4-Hour Chart Analysis

Back to the US, volatility compression continues to be the dominant force, with the corresponding triangle pattern still being intact in the market of the major indices, as Friday’s session failed to provide clarity.

S&P 500 Futures, 4-Hour Chart Analysis

The S&P 500 is flirting with the resistance zone near the $2675 level after the overnight bounce, with the crucial $2650 level also being in focus. The pattern should break soon, but we still advise traders to wait with short-term trades until a clear move, as short-term bullish and long-term bearish signals continue to contradict here.

Dollar Under Pressure despite Retail Sales Beat

EUR/USD, 4-Hour Chart Analysis

The Euro and the Great British Pound stand out in the otherwise quiet forex segment, sporting gains against the other majors, even after the slight positive surprise form the US retail sales report. The EUR/USD pair is back near the 1.24 level, despite the drift higher in Treasury yields, as commodity currencies are also slightly higher today compared to the Greenback.

GBP/USD, 4-Hour Chart Analysis

The GBP is close to hitting another new post-Brexit high against the Dollar, as the long-term re-appreciation trend is still on. Commodities are a mixed bag, with gold trading near $1350 again, benefiting from the Dollar weakness despite the slight risk-on shift, while oil pulling back thanks to the relief regarding the Syrian situation.

With the Yen virtually unchanged, it’s safe to say that safe-haven assets are not confirming today’s equity bounce, so bulls should remain cautious despite the still bearish sentiment that we pointed out several times last week, which fueled the choppy bounce in stocks.

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Author:
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.