Equities On The Up Over Russia-Ukraine Hopes
It’s been a better start to the week for benchmark global equities indices with risk sentiment rebounding amidst hopes for diplomacy between Russia and Ukraine. Markets have been rattled recently by news of the ongoing build up of Russian forces on the border with Ukraine, along with a dizzying array of headlines suggesting that war is imminent. However, there has been a slightly more optimistic tone to news flow over the last 24 hours. Ukraine has called for emergency talks with Russia in the hopes that a conflict can be avoided with Russia saying that a diplomatic solution is still possible. Additionally, there have been headlines out of Russia this morning noting that, following military drills, some troops are returning from the border to their Russian bases. For now, the situation remains a tense waiting game though it seems the markets, at least, are enjoying some brief relief amidst the hopes that tensions won’t tip over into violence.
Away from these tense geo-political matters, a more tentative USD move today is also helping lift equities prices. The greenback failed to break higher, despite better-than-expected CPI, with the move stalling for now. Looking ahead, we have US PPI later today and retail sales due tomorrow, both of which have the potential to caused USD volatility and will be closely tracked by equities traders.
Technical Views
DAX
Following a further dip below the 15078.84 level, the DAX found strong demand on approach to the 14791.27 level with price rebounding firmly back above the 15078.84 handle. While above here, and with both RSI and MACD turning bullish, the focus is on a continuation higher. However, bulls need to see price quickly back above the broken bull trend line and 15473.84 level to regain bullish momentum.
S&P 500
The recent dip back beneath the 4475.25 level has seen buyers stepping in to stem the declines for now. If buyers can get price back above the 4475.25 then we might be seeing the market putting in a higher low against the 4295.75 level, suggesting room for a further push higher back towards the 4575.50 and the 4744 level above.
FTSE
For now, the FTSE has pulled back under the bull channel top, following the rejection at the 7691.6 level. With bearish divergence on these recent rallies, a deeper correction is a risk, with 7362.6 the key support to note. To the topside, if the market can hold above the 7558.7 level, the focus remains on a continuation towards 7792.1 next.
NIKKEI
While the initial move back into the triangle failed, the subsequent sell off has found decent demand once again. With the market now potentially carving out a higher low against the 26246 level, the focus is on a further push higher towards the 28356.6 level and triangle top next.
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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.