Wall Street advances to five-week high
Hopes for a solution to the US government shutdown and progress in the US-China trade negotiations helped US indices power to the highest levels since mid-December on Friday. China Q4 GDP data are on tap today, which could determine near-term direction, while GBP traders await PM May’s alternative Brexit proposals.
US30USD Daily Chart
The US30 index climbed to the highest level since December 3, extending gains to a fourth week, as US President Trump prepared to announce a proposal to end the government shutdown. The proposal was immediately panned by both sides and branded a non-starter by House speaker Pelossi. US indices look to be edging lower in early trading today
The index is approaching the congestion area of the 61.8% Fibonacci retracement of the October-December drop at 24,932 and the 200-day moving average at 24,975
Today is a US bank holiday commemorating Martin Luther King’s birthday.
DE30EUR Daily Chart
The Germany30 index posted the biggest one-day gain since January 4 on Friday, hitting the highest level since December 5
The 55-day moving average at 11,084 was breached for the first time since September 28. The 100-day moving average is at 11,506
German producer prices are expected to drop 0.1% m/m in December, the first monthly decline since February last year, potentially reducing pressure on the central bank to hike rates.
CN50USD Weekly Chart
The China50 index closed at its highest level since December 14 on Friday, buoyed by Wall Street sentiment
The index nearly touched the 200-week moving average at 11,146 last Friday, but closed above the 100-day moving average at 11,069 for the first time since December 3
The Chinese economy is seen expanding 6.4% y/y in Q4, the slowest growth since Oanda records began in 2010. On Friday, 2017’s full-year growth was downgraded to 6.8% from 6.9%, which could help make the 2018 numbers look a bit better.
