Wall Street climbs as trade talks progress

US-China trade talks supposedly made significant progress last week, so much so that they will continue in Washington this week. China’s new loans data suggest stimulus measures may be taking hold.

US30USD Daily Chart

Source: OANDA fxTrade

• The US30 index posted the biggest one-day gain since January 4 on Friday, rising to the highest level in 10 weeks on trade talk optimism

• The next resistance point could be the December high of 26,085. The 200-day moving average at 25,051 may act as near-term support

• It’s the US Presidents’ Day holiday today, with no data releases scheduled. Liquidity/activity may be thin.

 

DE30EUR Daily Chart

Source: OANDA fxTrade

• The Germany30 index surged on Friday, shrugging off early losses, amid positive vibes from the trade talks, while shrugging off any possible fallout from the snap general election called in Spain

• The index closed above the 100-day moving average at 11,295 for the first time since August 9 on Friday. The next resistance level could be the high from earlier this month at 11,392

• There are no data releases scheduled for today. The US is due to release a Commerce Dept report supporting a 25% tariff on cars and other options. This could affect German shares.

 

CN50USD Daily Chart

Source: OANDA fxTrade

• China shares extended the retreat from 4-1/2 month highs on Friday, posting the biggest one-day loss since January 22 as investors feared China may have to make heavy concessions in order to secure a trade deal

• The index is dropping toward to 200-day moving average at 11,400

• Data released Friday showed China’s new loans surging to a record 3.23b yuan in January, well above forecasts of an increase to 2.8b and December’s 1.08b. This suggests the government’s stimulus measures may be filtering through to the broader economy.