Dow, Nasdaq and DAX rise to a stronger finish on US-Chinese goodwill gestures
Dow experiences technical overview shift buoyed by drop in trade risks, DAX at a pivot point ahead of crucial ECB meeting.
DOW: Back near record highs as positive trade talk forces a technical overview shift
Once again, it’s trade talk that has caused another technical overview shift for this index, with its price back near record highs and at a mid-term resistance level whereby most of its technical indicators are flashing green. The catalyst this time around has been US and Chinese exemptions ahead of October trade talks, though as always, the lack of a result will keep gains at risk of being undone (and in a harsh way). Apple outperformed yesterday following its lineup release and more aggressive pricing, though overall, it’s been a day of mostly winners as risk appetite improves and US yields rise further of the lows. Rate expectations continue to drop though are still pricing in a 0.25% rate cut come next Wednesday. In terms of sentiment, retail bias is back at extreme short levels at 77%.
NASDAQ: Significant gains on improved risk appetite infuse the index with more positive technical bias
While its been the Dow outperforming on the US front, the Nasdaq did manage to finish significantly higher and infuse its technical overview with ongoing technical bias, though a non-trending ADX means it’ll need slightly more to shift its technical overview. But more oscillatory movement here has been enticing traders into range-trading, and hence majority short bias rose by more yesterday, by 5% to a heavy short 67%.
DAX: At its short-term resistance level ahead of the ECB
It’s a big fundamental day for the euro, as well as Eurozone bonds and equities. Should the central bank introduce aggressive easing that involves purchasing government bonds and that could force more money into riskier assets, and lift the DAX further following what has been six consecutive days of gains that has infused the index with more positive technical bias and aided its initializing bull trend. Breakouts (to the upside or downside) will be more ideal with fading strategies avoided due to the risk of being stopped out. Going into today’s event, retail traders are heavy short and unchanged at 73%.
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