Zak Mir, technical analyst for Zak’s Traders Café, and Paul Wallace, Coach for Traders Belief, joined Nick Batsford on the Tip TV Finance Show to discuss the major Indices, forex including EURUSD and USDJPY, as well as whether you are a greed or a fear based trader.
Index Outlook
Batsford began with the S&P 500, and noted it continues to test support at 2000, with failure warning of another test of the support at 1870, but respect is more likely and would indicate another test of the resistance at 2130. Wallace added that if the S&P 500 gets above the trend line and holds, he would have his bull hat on and targets old highs.
He moved onto the Dow Jones Industrial Average, where he commented that it is similarly testing support at 17000.
In terms of Germany’s DAX, Batsford outlined that it respected support at 10000, with recovery above 10500 being likely and would indicate a bear rally to 11000.
The FTSE 100 continues to test support at 6250, with respect likely and recovery above the descending trend line and resistance at 6500 would suggest another test of 7000.
Watch the video to see more analyse on the Shanghai Composite Index, Hong Kong’s Hang Seng, Japan’s Nikkei 225 and the VIX.
Markets surprised by Draghi’s deposit rate cut talk
Batsford highlighted FX Street, who noted that markets believe more QE and a deposit rate cut in December is now a done deal, however, commodities may ruin the ECB’s plans. As a result of the ECB announcement, they outlined that UK and US 2-yr yields are relatively resilient, whilst the GBP/JPY and GBP/CHF appear poised for a rally, and the Gold/EUR could rise to EUR 1090/Oz.
Forex Forecast: EUR/USD lower, USD/JPY support at 50-DMA
In terms of the EUR/USD, Wallace commented that the pair is looking down to 1.08 and could go further to 1.0460 if it closes the other side of the upward trend.
Wallace moved onto USD/JPY, and believed that it has dynamic support at the 50-DMA. He added that the USD may see strength for the rest of the year as the other side of the EUR weakness.
What type of trader are you?
Wallace outlined that you can either be a greed or a fear based trader, and although he noted it doesn’t matter which one you are, he believed that greed traders exercise poor risk, whilst fear traders miss the glamour but have less risk.
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