This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Asia was quiet overnight as China is on holiday for the Lunar New Year, and the Japan 225 finished higher as a soft yen boosted equities.
Stock markets in Europe tried their best to hang onto the positive start but it didn’t last long as the downward trend that has been in place since late January took precedence. Equity markets can’t hold a rally and the moves to the downside are sharp and fast.
The FTSE 100 has printed a fresh low for February and the next big support levels in sight are 5769 and 5688. Bounces may see more short sellers entering the market and rallies will encounter resistance at 5821.
The Duitsland 30 is at its lowest level since late October 2015, and there is no sign that the downward trend is coming to an end. The 9000 mark is on the horizon for the bears.
The dollar has pulled back after the broadly positive US jobs report on Friday, and EUR/USD and GBP/USD are enjoying the move higher. The upward trend for both markets still holds but traders need to be cautious that the US dollar acts as a safe haven when stock markets are falling.
Gold is continuing to push higher, and the buy-the-dip strategy is still popular with traders. The softer dollar and the selloff in stock markets is keeping demand for gold high. While the metal holds above the support level $1164 further gains are possible and $1183 is the next major resistance level.