Market in the red waiting for Jerome Powell
During today's session, we have seen the employment data from the United Kingdom where we can see that the labour market continues to recover little by little after the crises caused by the pandemic after the unemployment rate settled at 4.7%, thus continuing the downward trend after reaching the highest peak last March.
On the other hand, we have also known the preliminary GDP data for the euro area in which although the preliminary GDP for the second quarter of the year has reached market consensus by establishing a growth of 2%, the preliminary year-on-year GDP remains below expectations by reaching a growth of 13.6% compared to the 13.7% expected by the market consensus. Despite this, it seems that the recovery in the euro area is maintaining its positive pace.
If we focus on the main stock indexes, we can see that so far this session they are all trading practically in the red because the market is waiting for Jerome Powell's words this afternoon, after yesterday Monday, the chairman of the Federal Reserve in Boston indicated that this body could see as enough a new positive month in relation to the labor market to begin to reduce its monthly asset purchases. Over the past few weeks there has been a lot of speculation about the possible start of the FED's tapering by pate although it is possible that Jerome Powell will not announce anything about it until the Jackson Hole symposium from August 26.
As we commented in our analysis of last July 23 on the DAX30, after bouncing in the important support area coinciding with the lower band of the side channel and the uptrend line represented by the red circle, the price obtained a new bullish momentum that led it not only to exceed its 18 and 40 session moving averages to the upside, but also led it to break its previous resistance level higher and to mark new historical highs after surpassing 16,000 points last Friday.
After that point and with the growth of rumors about a possible tapering by the FED, the DAX lost just over 0.6% during the week, which has led it to seek support in the orange band that was previously its resistance but that currently acts as support. The loss of this level and its 18-session blank moving average could open the door to further correction in search of its uptrend line.
Evolution in the last 5 years:
- 2020: 3.6%
- 2019: 25.48%
- 2018: -18.26%
- 2017: 12.51%
- 2016: 6.87%
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