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GBPUSD decreased 0.0024 or 0.19%Overnight data showed that UK’s Rightmove house prices rose on a monthly basis in April. The pair witnessed a high of 1.2832 and a low of 1.2772 during the session. GBP/USD remains neutral for consolidation below 1.2903 temporary top. With 1.2614 resistance turned support intact, further rally is expected. Firm break of 100% projection of 1.2108 to 1.2614 from 1.2365 at 1.2871 will target 161.8% retracement at 1.3184. Still, price actions from 1.1946 are seen as a correction. Hence we'd expect strong resistance below 1.3444 to bring larger down trend resumption. On the downside, break of 1.2614 resistance turned support will turn bias back to the downside for 1.2365 support first.
by Jadtecnic
UK FTSE100 coming under pressureThe anticipated pullback is unfolding, with the UK FTSE100 Index falling sharply to the 7093.57 low of February. A short-term bounce is possible, as oversold daily studies unwind. Weakening momentum studies and the bearish Tension Indicator (not shown) should limit scope. In the coming weeks, further downside tests are looked for, as investors adopt a cautious stance. A break below 7093.57 will target psychological support at 7000 and the 6972.20 Fibonacci retracement. Still lower is the 6860 Fibonacci retracement. Resistance is lowered to the 7255.78 break level from 27 March, and should cap any immediate bounce as investor sentiment weakens. If broken, however, focus will turn back to critical resistance at the 7447 high of March. An unexpected break above here would delay lower levels, but should find difficulty clearing the 7500/11 barrier as background readings also begin to turn down. The full report, covering the US, UK, Germany, Europe, Japan, Hong Kong and China indexes can be found at our website.
TVC:UKX
by Michael_Macdonald-XATSUK
Global Equity Risks Increasing In The Coming MonthsA more cautious tone is appearing across global equity markets. Further gains to prove increasingly difficult to maintain. China poised to break higher? Global equity markets remain in their dominant bull trends. Investor portfolios are overweight and investor sentiment is positive. However, warning signals are now appearing, suggesting further gains are likely to prove increasingly difficult to maintain. Geopolitical risks are growing – for example, heightened tensions in the Middle East and increasingly strained rhetoric between the US and North Korea. Against this backdrop, the Volatility Index, VIX, which is a measurement of market volatility, is showing signs of a trend change. Since August 2015, the Volatility Index has been falling steadily. This reduction in volatility has helped to quell market fears and increased investor confidence. Their portfolios have thus been balanced around a ‘risk-on’ approach – overweight equities. Recent political developments are now being reflected in the VIX, as prices begin to trade higher from historic supports. Positive divergence in rising momentum studies and steady improvement in the proprietary Tension Indicator highlight potential for a price bounce into the coming months. As the VIX trades higher, volatility increases and investors become more cautious. This will lead to adjustments in portfolio equities, and a corrective pullback in equity prices. We thus maintain a cautious stance to US equities and expect further gains will prove increasingly difficult to maintain. The UK FTSE100 Index is also being driven by investor insecurity. Following the UK prime minister’s shock announcement of a snap General Election in June of this year, the FTSE100 has fallen sharply from historic highs. This sharp pullback is helping to unwind overbought momentum studies, and is expected to keep prices under pressure into the coming months. A break below 7000 would not do too much damage to the dominant bull trend. However, a close below the 6675/80 lows of November-December 2016 would increase downside risks, and lead to renewed portfolio reduction. Against this gradually deteriorating backdrop, European bourses are also coming under pressure. The European EuroStoxx50 Index and the German DAX Index are expected to turn away from current highs. In Asia, the Hong Kong Hang Seng Index is also vulnerable to a pullback. The China Composite Index, however, is showing signs of stabilisation within the prolonged consolidation pattern. Improving studies highlight potential for a break above critical resistance at the 3285, (61.8%) Fibonacci retracement of the 2015-2016 fall and 3301.66 high of November 2016. Subsequent gains would confirm continuation of the broad 2016 rally and turn investors outright bullish.
TVC:VIX
by Michael_Macdonald-XATSUK
EURGBP H&S . Prepare your shorts!To me this is just perfect. I had this pitchfork in my graphs for more than a year and it has been very accurate. Break the Pitchfork and complete the Head and shoulders pattern and our target is back to 0.76. All the read lines from the peaks to the baseline are copied and pasted. Only exception is the last right small peak that was a bit shorter! You can see the two peaks on each side as one shoulder each, peaks closer to the head are higher than the ones further from the head. The also have the same length, despite the right one taking a bit longer to play out.
Short
by BitcoinMacro