Europe Open: Equities erased early losses. Short-term recovery in sight?

DAX Futures M15

L3 potentially working as a support during European session. Nonetheless we will need to see prices rally above Yesterday’s Low of 7,346 and also H3 of 7,375 before bears can lose their conviction.

FTSE100 Futures M15

Appears to be more bearish compared to DAX, but L3 is also working nicely as a short-term support. In the case of FTSE100, Yesterday’s low may not provide a strong resistance as compared to H3 5,825 which incidentally is also near the opening levels of yesterday.

EUR/USD H1

Taking cue from DAX futures, we can see EUR/USD behaving the same with Yesterday’s low and L3 providing resistance band for any upside moves. Overall EUR/USD looks heavy, but do not be surprised to see EUR/USD rally should we see DAX futures climbing its L3 level as L3/L4 typically act as a support zone for any downside pressure.

GBP/USD H1

The relationship between FTSE and GBP/USD is similar to DAX and EUR/USD. Should GBP/USD rally back up to H3, the likelihood of FTSE rallying back towards H3 increases and vice-versa.

Brent Crude Futures H1

Crude appears to be nicely supported around 109.75 to 109.80 levels, which incidentally is around yesterday’s low and L3 level for today. Compared to other currencies and equities indices, Crude still appears to be ranging rather than outright bearish. If Crude starts to drop below L3 and more importantly L4, we could see equities and currencies continue their bear trend.

Bottomline:

After the sell off experienced during yesterday’s US session and overnight Asian session, bears appear to have abated a little. Similar to the Asian Closing analysis, watch for where the pull back stops which can provide reference if further rallies can be expected.

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