Improved investor sentiment continued through Friday although US Equities managed only modest gains after another positive day in Europe. The Eurostox 600 Index added 0.6% to reach its highest level in more than a year while the S&P had its sixth weekly rise in a row. The VIX fell 5.9% to 13.5 % which is its lowest level since June 2007. The market continues to be supported by the comments from Merkel last week in that Germany will do
whatever it takes to support the Euro and Greece. The investment bank, Goldman Sachs,
have a report out this morning saying it time to bet on a large recovery in Europe. The University of Michigan Consumer Survey came in better than expected at 73.6 and it
looks like the pullback in this index seems to be bottoming. UK August Home prices fell on Economic and Olympic distractions. Later today we have the Chicago Fed National Activity Index.
Sept S&P 500
Friday was another very quiet day for US Equities but volatility and volume should start to pick up this week as traders start to return from their summer holidays and we have a lot of economic data due later in the week. The market just missed my 1410 buy level and I am still flat. I will leave the guidelines the same as Friday, I will look to go long from 1407/1411 with a 1404 stop and I still want to go short from 1420/1425 with a 1427 stop. A break and close over 1425 will be very bullish.
EUR/USD
No change from Friday as we continue to trade this narrow range. I only want to go short from 1.2420/1.2440 with a 1.2460 stop. Otherwise I am happy to stand aside.
Sept BUND
The Bund has dropped into my buy area this morning and I have gone long at 141.25. I will raise my stop to 140.95 and I will look to take profit on any move back to 141.75/141.90. If I manage to take profit here I will still look to reset my long position from 141.00/141.30.
Sept FTSE
The FTSE continues to struggle and I was amazed that we could not rally into my sell area given how positive the European and US equity markets are. I will leave my sell area the same and I still want to go short from 5860/5880 with a 5895 stop. If I am taken short I will look to take profit on any dip to the 5800 area.
Sept DAX
I have not traded the DAX for the last 2 weeks. The market is getting very overbought and today I will look to go short in small from 7070/7100 with a tight 7120 stop. If I am taken short I will look to cover from 6995/7020.
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