Morning Insights 18th January

Simon Alagbe

Analyst


Instrument: US 30 (Dow Jones Industrial Average)

Technical Analysis

Bearish Preference: Sell position is envisaged if price trades below 30607 with take profit at 30520

Bullish Preference: Buy position is envisaged if price trades above 30715 with take profit at 30808

Fundamentals:

No major economic data with bearing on the index

Comment:  The growing concern of new infections around the world is weighing heavily on the stock market despite the release of upbeat economic data from China. Data from China earlier today confirmed that the Chinese economy grew 2.3% last year with a GDP growth of 6.5% in the 4th quarter over the recordings a year earlier. The general concern about potential violence at the inauguration of Joe Biden on Wednesday is not helping the cause of the market. 


Instrument: USDCAD

Technical Analysis:

Bearish Preference: Sell position is envisaged if price trades below 1.27533 with take profit at 1.27265.

Bullish Preference: Buy position is envisaged if price trades above 1.28017 with take profit at 1.28259.

Fundamentals:

No Fundamentals

Comments: The loonie has been mercurial for the unstable oil prices and recently the buck has seen a rise against the loonie and we expect prices to go higher as the 50 EMA and 200 EM seem to merge forming a golden cross, so a strong bullish move is expected.


Instrument: EURUSD

Technical Analysis:

Bearish Preference: Sell position is envisaged if price trades below 1.20364 with take profit at 1.19846

Bullish Preference: Buy position is envisaged if price trades above 1.21207 with take profit at 1.21648.

Fundamentals:

No Fundamentals

Comments: Despite the poor data on core retail sales last week, the dollar still gains strength on major currency pairs. We could attribute that to the Biden admin, promising to pass a stimulus package of 1.9 trillion dollars. This payment would provide enough macroeconomic foundation to shock the dollar slum. So a lot of investors are optimistic about the passage of this stimulus package.

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