Yellow vests joined by red and yellow flags

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For a 13th consecutive weekend protesters in France wearing high viz yellow vests demonstrated against the government of President Macron; he made no comment. In Madrid centre-right and far-right protestors swarmed the streets around Madrid’s Plaza Colon calling for early elections. Official figures put their numbers at 45,000; unofficial ones closer to 200,000. They are attempting to topple the minority government of socialist Pedro Sanchez (who holds just a quarter of the seats in parliament).

On Friday Moody’s upgraded their rating on Russian sovereign debt to Baa3 and improved the outlook to stable. This now means that the paper is categorised as investment grade by all major rating agencies. At the other end of the scale Germany’s Deutsche Bank was forced to pay 180 basis points over 2-year bonds to raise €3.6 billion and 230 basis points over the benchmark for 7-year funds. According to the Financial Times this is the highest financing rate on euro-denominated debt for a leading international bank this year.

DAX 30

A shooting star type candle last week following two consecutive hanging me suggests an interim high is in place. Note that momentum has been bearish throughout this year’s bounce.

 

SHORT TERM TRADER: Small short at 11180; stop above 11400. First target 10600.

 

POSITION TAKER:  New short at 10955; stop above 11400. Target 9350.

FTSE 100

No clear chart signals since rallying above the psychological 7000. Capped late last week half way between the record high and last year’s low, which may, or may not, be significant.

 

SHORT TERM TRADER:   New little short at 7115 – just for the fun of it; stop above 7215. Target 6745.

 

POSITION TAKER:  Square.

S&P 500

Retracing over a Fibonacci 61 per cent of the slump in Q4 2018 yet weekly momentum has yet to turn bullish. Quite extraordinary. Sino-US trade negotiations resume in Beijing this week with lots of hopes for so-called ‘resolution’ in all too many quarters. Note that today is a public holiday in Japan and that for some, the Chinese Lunar New Year holiday continues this week too.

 

SHORT TERM TRADER:  Square.

 

POSITION TAKER:   Square.

BRITISH POUND/US DOLLAR

Pathetic levels of bullish momentum explain the retreat from resistance at 1.3200.

 

SHORT TERM TRADER:  Small long at 1.2935; stop below 1.2825. Target 1.3200.

 

POSITION TAKER:  Square.

EURO/US DOLLAR

The straight-jacket is holding – for now.

 

SHORT TERM TRADER:  Small long at 1.1335; stop a bit below 1.1285. Target 1.1500.

 

POSITION TAKER:  Square.

GOLD

A hanging man last week adds a little weight to our slightly negative stance.

                            

SHORT TERM TRADER:  Small short at 1317; stop above 1328. Target 1240.

 

POSITION TAKER:  Square.

Nicole Elliott is a long-standing member and Fellow of the Society of Technical Analysts and has taken over the IC’s trading coverage.  She is regularly interviewed and quoted by the financial media, is a conference speaker, and author of several books on charting.

2019-02-11 00:59:00

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