Technical Analyst, Saxo Bank
AEX 25 Index is close to testing the June low at 632. The support at 632 is strong and a bounce is likely to be seen. Divergence on RSI on both daily and weekly supports the rebound scenario. However, the trend is down and a close below could take the AEX Index to around 600 support.
BEL20 closed well below key support at 3,506 last week. There is no divergence on RSI Making new lows indicating lower levels on the Index is likely. Next key support is at around 3,235 close to the 0.618 retracement at 3,173. To reverse the down trend a close above 3,740.
CAC40 closed Friday a few points below key support at 5,786 testing March lows at 5,756. This morning buyers are trying to lift it back above. If CAC40 closes above 5,786 we could see further upside to towards 6.000.
However, the selling pressure could quickly resume sending CAC 40 lower. If closing below 5,755 there Is not support until around 5,392.
2024: The wasted year
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.
Markets are driven by election optimism, overshadowing growing debt and liquidity concerns. The 2024 elections loom large, but economic fundamentals and debt issues warrant cautious investment.
As US economic slowdown hints at a shift away from exceptionalism, USD faces downside with looming Fed cuts. AUD and NZD set to outperform as their rate cuts lag. JPY gains on carry unwind bets and BOJ pivot.
Amid AI and obesity drug excitement, equities see varied prospects: neutral on overvalued US stocks, negative on Japan due to JPY risks, positive on Europe. European defence stocks gain appeal.
With the economic slowdown, quality assets will gain favour, especially sovereign bonds up to 5 years. Central banks' potential rate cuts in Q2 suggest extending duration, despite policy and inflation concerns.
Commodities poised for rebound. The "Year of the Metal" boosts gold and silver, copper awaits rate cuts. Grains may recover, natural gas stabilises. Gold targets $2,300-$2,500/oz, copper's breakout could signal growth.