A recap on what happened right before/ during the weekend, in the US on Friday, strong company earnings reports led to strong buying of the S&P500 and the NASDAQ, both up more than 1% and the Dow Jones following with three quarters of a percent. So far more than two thirds of the earnings reported have beaten analysts’ expectations and have led for a number of calls that the S&P500 is going to surpass that 2,000 mark by the end of the month. The level, never seen on the index before would certainly be a big psychological barrier to break and anyone calling a stock bubble might use this level as a reference point.
In Gaza, fighting persists with the death toll rising quickly on both Israeli and Palestinian sides. A two hour ceasefire agreed on humanitarian grounds yesterday was broken and currently neither side is looking to back down.
Also from the Middle Eastern region; Iran has failed to agree terms for its nuclear projects with other world powers. The talks have now been extended for another four months, to try and find some common ground.
Looking at the week ahead; Portuguese banking is likely to be an area of concern as one of the parent companies of Banco Espirito Santo filed for creditor protection over the weekend. This ongoing development is continuing to show signs that the government will have to step in at some point.
The US earnings calender is pretty relentless this week, with Apple, Microsoft, Facebook and Amazon a few of the names that markets will be looking at and could help tip the S&P over the 2,000 barrier.
In the UK the Bank of England minutes could create some volatility in Mr. British Pound’s moves. Ernst and Young’s item club upgraded their UK forecasts over the weekend and said the UK economy will “hit a sweet spot” this year. We’ll also be watching UK retail sales and the first reading of Q2 GDP on Thursday.
So here you got the fundamentals to start your week off. Are you ready for our weekly technical video update tomorrow?
Intraday Forex Technical Levels
EUR/USD Intraday: turning down.
Invest Diva likes: Short positions below 1.3545 with targets @ 1.349 & 1.3465 in extension.
If pair goes nuts: Above 1.3545 look for further upside with 1.3575 & 1.359 as targets.
What’s up on the forex dance floor: As long as 1.3545 is resistance, likely decline to 1.349. A false upward breakout is identified, this calls for a downturn.
Supports and resistances:
1.359
1.3575
1.3545
1.352 Last
1.349
1.3465
1.3445
GBP/USD Intraday: the downside prevails.
Invest Diva likes: Short positions below 1.71 with targets @ 1.7035 & 1.6995 in extension.
If pair goes nuts: Above 1.71 look for further upside with 1.7115 & 1.714 as targets.
What’s up on the forex dance floor: As long as the resistance at 1.71 is not surpassed, the risk of the break below 1.7035 remains high.
Supports and resistances:
1.714
1.7115
1.71
1.708 Last
1.7035
1.6995
1.696
USD/JPY Intraday: key resistance at 101.45.
Invest Diva likes: Short positions below 101.45 with targets @ 101.05 & 100.85 in extension.
If pair goes nuts: Above 101.45 look for further upside with 101.6 & 101.8 as targets.
What’s up on the forex dance floor: As long as 101.45 is resistance, look for choppy price action with a bearish bias.
Supports and resistances:
101.8
101.6
101.45
101.364 Last
101.05
100.85
100.5
USD/CHF Intraday: bullish bias above 0.8965.
Invest Diva likes: Long positions above 0.8965 with targets @ 0.9 & 0.9015 in extension.
If pair goes nuts: Below 0.8965 look for further downside with 0.8935 & 0.891 as targets.
What’s up on the forex dance floor: A support base at 0.8965 has formed and has allowed for a temporary stabilisation.
Supports and resistances:
0.904
0.9015
0.9
0.8984 Last
0.8965
0.8935
0.891
NZD/USD Intraday: the bias remains bullish.
Invest Diva likes: Long positions above 0.867 with targets @ 0.8745 & 0.8785 in extension.
If pair goes nuts: Below 0.867 look for further downside with 0.8645 & 0.86 as targets.
What’s up on the forex dance floor: The RSI is mixed with a bullish bias.
Supports and resistances:
0.8815
0.8785
0.8745
0.8692 Last
0.867
0.8645
0.86
AUD/USD Intraday: key resistance at 0.941.
Invest Diva likes: Short positions below 0.941 with targets @ 0.9325 & 0.929 in extension.
If pair goes nuts: Above 0.941 look for further upside with 0.9455 & 0.9485 as targets.
What’s up on the forex dance floor: As long as 0.941 is resistance, look for choppy price action with a bearish bias.
Supports and resistances:
0.9485
0.9455
0.941
0.9379 Last
0.9325
0.929
0.9255
USD/CAD Intraday: the bias remains bullish
Invest Diva likes: Long positions above 1.0695 with targets @ 1.0795 & 1.0825 in extension.
If pair goes nuts: Below 1.0695 look for further downside with 1.0655 & 1.0625 as targets.
What’s up on the forex dance floor: Even though a continuation of the consolidation cannot be ruled out, its extent should be limited.
Supports and resistances:
1.0855
1.0825
1.0795
1.0743 Last
1.0695
1.0655
1.0625
US Index Outlook
S&P500
Short positions below 1978 with targets @ 1942 & 1937 in extension.
Alternative scenario: Above 1978 look for further upside with 1984 & 1986 as targets.
Dow Jones
Short positions below 17110 with targets @ 16785 & 16725 in extension.
Alternative scenario: Above 17110 look for further upside with 17160 & 17215 as targets.
Nasdaq 100
Short positions below 3942 with targets @ 3832 & 3808 in extension.
Alternative scenario: Above 3942 look for further upside with 3961 & 3981 as targets.
Russell 2000
Short positions below 1159 with targets @ 1112 & 1103 in extension.
Alternative scenario: Above 1159 look for further upside with 1176 & 1194 as targets.
