Technical Analyst, Saxo Bank
Summary: DAX/GER40 struggling for upside momentum
AEX25/NETH25 rejected a second time at 781. Could be range bound until ASML earnings
BEL20/BELG20jumping, could reverse down trend
CAC40/FRA40 rang bound. Break out needed for direction
DAX seems to be struggling for upside momentum. DAX is above the cloud and above all daily Moving Averages but RSI is still showing negative sentiment. An Index close above 16,210 and RSI needed for confirmation of an uptrend.
IF that occurs DAX is likely to test all-time highs at 16,427.
If DAX is failing to close above 16,210 it could slow slide back to support at around 15,782
GER40 cfd: Restiance at 16,210.
AEX25 has now closed above 777 a couple of times but seems to have problems getting higher than 781. RSI is positive suggesting higher AEX levels but a close above 781 is needed for uptrend confirmation.
A close above 781 is likely to fuel a rally to 802 possibly 830. ASML earning alter this week could be the deciding factor.
If AEX fails to break higher it could be caught range bound between 781 and 748 for quite some time.
NETH25 cfd. 781 resistance is key. Could be range bound between 781 and 748. ASML earning alter this week could be key
BEL20 is jumping right from the opening Monday morning trading above its upper falling trendline and above resistance at around 3,668.A that time of writing RSI is also back above 60 threshold indicating higher levels are likely. It requires the Index close s above 3,668 and RSI above 60.
However, there is some resistance around the at around 3,700 which is both around the upper part of the Cloud AND the 100 and 200 daily Moving Averages.
If BEL20 can overcome those obstacles there is upside potential to around 3,850-3,900.
If BEL20 closes below the 55 daily Moving Average currently at 3,630 and RSI fails to close above 60 the Index could resume downtrend.
BELG20 cfd broke above falling trendline testing resistance at 3,679.
CAC40 is range bound between 7,083 and 7,404. Break out is needed for direction.
A close above 7,404 could fuel a rally to 7,600
A close below 7,083 could fuel a sell-off down to around 6,900
FRA40 cfd: range bound between 7,081 and 7,424. Break out needed for direction
Bond. Long Bond(s)
With real rates being too positive, we see three scenarios: Opportunity to lock in rates at cycle high, government overreach to keep the economy afloat or a complete reset of the economy.
Steen Jakobsen,
Chief Investment Officer
Is a bond bull market ahead? Inflation still poses a risk for investors, but the moment for increasing duration to your portfolio may be approaching towards the end of the year, when central banks might be forced to cut interest rates.
Althea Spinozzi,
Senior Fixed Income Strategist
The furious rate hike cycle has brought gains in the US dollar, but with stagflation risks in Europe and the UK and weakness in the Chinese economy, USD may have more room to run. But a strong dollar could also have repercussions for US growth, emerging markets and commodity prices.
Charu Chanana,
Market Strategist
With the cost of capital rising painfully, stagflation fears are back, illuminating the fragile state of the green transformation, while giving a tailwind to nuclear power, and threatening the growth of AI-related stocks.
Peter Garnry,
Head of Equity Strategy
With supply tightness not only in energy but all commodities, the momentum in commodity prices may continue, pressuring central banks to lower real rates. That could be a good setup for precious metals, including gold, silver and potentially platinum as well.
Ole S. Hansen,
Head of Commodity Strategy
As the pandemic showed, even the US Treasury can experience seismic shifts. With the government increasing the pace of issuing bonds to support fiscal spending, the complex Treasury market and regulatory constraints could spark a liquidity event.
Redmond Wong,
Market Strategist
The tide has turned for bonds. Given the current yields, bonds have become an attractive investment, with added benefits including lower risk than stocks, increased diversification and a steady stream of income unaffected by economic changes.
Peter Siks,
Investment Coach