Daily Outlook Wednesday 8th July 2015
The latest developments regarding Greece include a deadline for an imminent Solution this Sunday. In the meantime, Greece needs to deliver a final proposal for a new aid package that will be much longer than the one that was on the negotiating table 2 weeks ago. The fact that the Sunday meeting will include all the leaders of the 28 EU countries, leaves also open the possibility for a Grexit agreement if there is no compromise by then.
EURUSD recovered on the back of this news and traded as high as 1.1040 during the US session however it has stabilized around 1.1000 this morning, just before the European Open. GOLD has showed its correlation with USD as the demand for the greenback caused Gold to reach 1147.60 lows, levels not seen since March 2015.
Another notable mover was OIL which also touched multi month lows by trading as low as 50.60 – down 20% since just two weeks ago. Fears about a recession in china are weighing on Black Gold. Silvers slide was recorded as the biggest mover yesterday though, with the shiny metal dropping more than 6% at one point.
In China, the massacre continues. Thousands of shares were suspended after trading limit-down even after the Government tries desperately to support investor sentiment by providing liquidity and engaging in positive sentiment propaganda.
Trading Quote of the Day: Two rules for investing/trading:
Rule number one : most things will prove to be cyclical Rule number two : some of the greatest opportunities for gain and loss come when other people forget rule number one – Howard Marks
USDCAD
Pivot: 1.2685
Likely scenario: Long @ 1.2733 with targets @ 1.278 & 1.282 in extension.
Alternative scenario: Below 1.2685 look for further downside with 1.264 & 1.261 as targets.
Comment: The RSI lacks downward momentum.
USDCHF
Pivot: 0.943
Likely scenario: Long positions above 0.943 with targets @ 0.9515 & 0.954 in extension.
Alternative scenario: Below 0.943 look for further downside with 0.939 & 0.936 as targets.
Comment: A support base at 0.943 has formed and has allowed for a temporary stabilisation.
OIL
Pivot: 53.4
Likely scenario: Short positions below 53.4 with targets @ 49.87 & 48.9 in extension.
Alternative scenario: Above 53.4 look for further upside with 54.7 & 55.5 as targets.
Comment: As long as 53.4 is resistance, likely decline to 49.87.
DAX
Pivot: 10915
Likely scenario: Short positions below 10915 with targets @ 10650 & 10535 in extension.
Alternative scenario: Above 10915 look for further upside with 11035 & 11115 as targets.
Comment: As long as 10915 is resistance, look for choppy price action with a bearish bias.