Wednesday, September 26, 2018 | 1 Technical Analysis Cyril BAUDRILLART, CFTe [email protected]+33.1.40.74.19.32 Morning Trading Comments SUMMARY OF TRADING VIEWS Stockmarket indices remain robust in the US and Europe ahead of tonight’s FOMC meeting. The technical outlook is also improving in Asia with Nikkei 225 back near January’s highs and Chinese indices bouncing back. On the opposite, government bond markets are feeling the heat whilst Oil prices are on fire. Even German 10-year bond yields broke above an important resistance at 0.50% yesterday with US peers close to year highs and holding above 3%. Fed comments will be closely monitored by markets tonight and should give the tune. CROSS ASSET EVENTS Oil is on fire As highlighted yesterday morning, Brent prices indeed broke above a key resistance at 80 USD, a rather bullish technical event. This breakout also triggered a triple-top buy on Point & Figure charts, a signal I will discuss in tomorrow’s Weekly Global Roadmap report. Overall this upside breakout shows that Oi prices remain incredibly strong and likely to keep outperforming most commodities. Natural Gas futures also made a nice breakout on Monday. Unsurprisingly, these events are triggering renewed interest for the Oil & Gas sector with numerous stocks breaking out (see charts of Aker BP and ENI on page 4).
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Stockmarket indices remain robust in the US and Europe ahead of tonight’s FOMC meeting. The technical outlook is also improving in Asia with Nikkei 225 back near January’s highs and Chinese indices bouncing back. On the opposite, government bond markets are feeling the heat whilst Oil prices are on fire. Even German 10-year bond yields broke above an important resistance at 0.50% yesterday with US peers close to year highs and holding above 3%. Fed comments will be closely monitored by markets tonight and should give the tune.
CROSS ASSET EVENTS
Oil is on fire
As highlighted yesterday morning, Brent prices indeed broke above a key resistance at 80 USD, a rather bullish technical event. This breakout also triggered a triple-top buy on Point & Figure charts, a signal I will discuss in tomorrow’s Weekly Global Roadmap report. Overall this upside breakout shows that Oi prices remain incredibly strong and likely to keep outperforming most commodities. Natural Gas futures also made a nice breakout on Monday. Unsurprisingly, these events are triggering renewed interest for the Oil & Gas sector with numerous stocks breaking out (see charts of Aker BP and ENI on page 4).
The 2920 area remains an important support zone ahead of today’s FOMC meeting. A breakdown below these levels is still needed to deteriorate the index’s technical outlook.
EURO STOXX 50 FUTURE (VGZ8)
RESISTANCES 3420 / 3444 / 3454
SUPPORTS 3380 / 3355-3350 / 3318
Comments
Taking a breather after strong revival.
PREFERRED CASE for next days
The index traded sideways yesterday, in line with expectations, and will probably continue to do so today before the Fed. The 3380 area remains firs important support for the day with 3420 resistance.
The index should continue to trade sideways today. Keep watching the 12300 area as an important support zone. A break below this level is still needed to deteriorate the ST outlook which remains strong at this stage.
All technical indicators used in this publication are based on historical prices broadcasted by Bloomberg. Several types of indicators are used in this report such as
Bollinger Bands, Oscillators (RSI, MACD), Point & Figure charts, Ichimoku, Keltner Bands and other technical analysis tools. More details on how to interpret and use
these tools are available upon request. Market timing indicators developed by Tom DeMark are also used in this report. The DeMark Indicators are a registered
trademark of DeMark Analytics, LLC. Please note that all the content shown are my personal views and based on my own interpretation of the DeMark Indicators
using the DeMark Service for Bloomberg. Please visit www.demark.com for more information.
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