Mixed Start For Markets

It’s been a mixed start to the week for global equities markets with US indices leading the pack on continued optimism over the recovery there. However, in the UK, Europe and Asia, the tone has been a little more subdued.

The FTSE has come under heavy selling pressure this week despite the latest easing of lockdown there. As of Monday, pubs and restaurants with outdoor areas have been able to resume service while non-essential retail and gyms, hair salons etc have also re-opened. However, with much of Europe in extended lockdowns amidst a third wave there, and with UK vaccination numbers slowing, there are fears of a resurgence of the virus which could see re-opening being postponed or reversed.

In Europe, the continued lockdowns across many key economies are keeping investor sentiment subdued. The ECB has reaffirmed its commitment to keeping monetary easing in place, forecasting that price pressures are likely to remain sticky at current levels for some time. The main focus now is the extent to which, if at all, European tourism will return this summer.

In Asia, the NIKKEI is finding some better buying today, attempting to recoup the losses suffered on Monday. However, strength in the Japanese Yen is offsetting this upside, reflecting a more cautious risk tone as we head through the European morning on Tuesday.

Technical Views


Following the breakout above the top of the bull channel, the DAX ran into selling pressure at the 15311.01 highs. For now, price is sitting in a holding pattern just below the level, keeping the focus on further upside. To the downside, any correction lower should find support into the 14783.12 level.


The Rally in the S&P continues to gather pace as price extends further beyond the last resistance at 3964.25. With this level now turned support, the outlook remains bullish while price sits north of here, bolstered also by the rising trend line.


The breakout above the 6803.1 level ran into selling pressure around the current 2021 highs last week. Price has since turned a little lower. However, while the market holds above the 6803.1 level, the focus is on a continued push towards the 7025.8 level next


The NIKKEI continues to hover around the 29749.1 level this week, with price currently sitting just below the level, capped by the bearish trend line from 2021 highs. Price has spent most of this year within a triangle pattern within the broader bull channel, suggesting an eventual breakout higher is still in play. This view will shift, however, o a break of the triangle low and the 28372.5 support

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