Stocks jumped in Europe, continuing the trend from Asian benchmarks, while US futures are also pointing to a firmer open on Tuesday. This sudden revival of an appetite for risk assets came amid signs of improvement in some of the hardest hit regions. Mainland China has made really good progress recently and is now said to be lifting the Wuhan lockdown, the location of the very first virus outbreak, on the 8th of April. Meanwhile in Europe, the new epicentre of the Covid-19 disease, Italy and Germany are registering fewer and fewer new daily cases, which shows the draconian measures taken by governments are working. The likelihood of a peak to come is the key piece of information to investors right now as most of them still struggle with the question of whether the market can go lower or not. Many investors will be tempted to buy the dip but most of them would like to enter the market with more certainty than there is now.
Photo by Quentin Kemmel.
So far energy shares and miners are the most powerful sectors in Europe and are the main contributors driving benchmarks higher today. The best performance is coming from both the DAX-30 Index of Frankfurt and the Italian FTSE-MIB with companies like Siemens, Total and ASML trading much higher than yesterday.
The technical configuration of the DAX-30 Index is really interesting as the market may be on the verge of validating an inverted “Head and Shoulders” reversal pattern (see attached chart) that has been built with significant volumes and could see the current bullish momentum push the price to 10,215pts, 10,900pts and ultimately 11,600pts on a short term-basis. However, the resistance level at 9,360pts will need to be cleared first.
While a student, Pierre Veyret had a passion for the financial markets. At the time, he studied International Trade through the setting up of import / export operations and it was the techniques of hedging against exchange rate risks that helped him to make the link with the financial markets, and all especially that of Forex. It is therefore with the aim of anticipating the price of currencies several months in advance that Pierre quickly turned to different methods of analysis by drawing inspiration and surrounding himself with experts in the field. Shortly after, Pierre decided to specialize in Technical Analysis, a discipline he had the opportunity to practice with real market professionals, thanks to AFATE / IFTA, an association of which he has been an active member for several years. Pierre Veyret is passionate about the field of the financial industry with a particular interest in the various techniques of stock market forecasting. Currently, Pierre is based in the City of London where he works as Chief Analyst. He performs regular interventions on a multitude of asset classes through various media (television, internet and print media).
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© 2019 High Leverage FX - All Rights Reserved.