- DAX 40:Struggles as German State Inflation Data Fails to Inspire.
- FTSE 100:Runs Out of Steam as Fears of a Global Slowdown Return.
- DOW JONES: Higher Following Yesterday’s Rout Amid Grim Consumer Confidence Picture.
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DAX 40: Struggles as German State Inflation Data Fails to Inspire
The Dax struggled in early European trade before recovering some losses as we approach the US Market open.
The news was positive in Germany, as the state of North Rhine-Westphalia, Germany's largest state by population said consumer prices fell in the month of June. That was the first drop in the annual rate since January and fostered hopes that headline inflation may be peaking in Germany, having reached 7.9% on the year in May.
Spanish inflation unexpectedly jumped 10% from a year ago in June, data showed Wednesday, a new 30-year high and up from 8.5% in May.
Investors will be keeping an eye on a meeting of European Central Bank (ECB) officials in Sintra, Portugal. ECB President Christine Lagardealong with Federal Reserve Chair Jerome Powell and Bank of England Governor Andrew Bailey will appear at a panel discussion Wednesday, starting at 13h00GMT.
The sectoral breakdown is not pretty as red dominates with healthcare and real estate posting losses of 3% and 2.9% respectively.
DAX 40 Daily Chart- June 29,2022
Source: IG
From a technical perspective, Yesterday saw a retest of the resistance area 13275 before rejecting and forming a shooting star candlestick pattern on the daily timeframe.
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We have pushed down during the European session but need a sustained push to the downside followed by a daily candle close below the 13000 area to confirm downside momentum. The key psychological level 13000 continues to hold on a daily timeframe as we remain rangebound.
Key intraday levels that are worth watching:
Support Areas
- 13230
- 13080
- 12975
Resistance Areas
- 13180
- 13275
- 13500
FTSE 100: Runs Out of Steam as Fears of a Global Slowdown Return
The FTSE rebound ran out of steam on Wednesday as UK shop prices surged at the fastest rate in 14 years. The British Retail Consortium (BRC) said retailers were having to pass on some of the burden of higher raw material costs.
The UK will cut off gas supplies to mainland Europe as part of a four-stage emergency plan drawn up to counter the Russian energy crisis.The British government told the Financial Times it was “fully confident” about the security of energy supply heading into the winter, adding that a gas emergency was “extremely unlikely”.
On the back of this, Morgan Stanley now predicts that the ongoing crisis will push the Eurozone into a recession in the fourth quarter this year. Later in the day attention will be on the European Central Bank (ECB) forum in Portugal, where Bank of England governor Andrew Bailey and Federal Reserve chair Jerome Powell are panelists.
The sectoral breakdown is predominantly red with real estate suffering the most, down 5% for the session. Notable movers included the British Land Company PLC which was down 8% for the session.
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FTSE 100 Daily Charts - June 29,2022
Source:IG
The FTSE ran out of steam yesterday as it approached the 61.8% FIB Level before a sharp rejection. We have declined and tested the 38.2% Fib Level in European trade before moving higher.
As we approach the 50% Fib Level, we could find resistance here while a break above will leave the possibility of a trendline retest open, around the 7400 area.
Key intraday levels that are worth watching:
Support Areas
- 7238
- 7140
- 7000
Resistance Areas
- 7390
- 7484
- 7568
| Change in | Longs | Shorts | OI |
| Daily | 8% | -12% | -6% |
| Weekly | -2% | 1% | 0% |
DOW JONES: Steady Following Yesterday’s Rout Amid Grim Consumer Confidence Picture
The Dow is higher in premarket trade after yesterday’s technology stock sell-off led the way.
Market Sentiment is weak following overnight losses on Wall Street as US consumer confidence dropped to a 16-month low in June.Evaporating consumer confidence is feeding into concerns that the US might tip into a recession.
Meanwhile, US Federal Reserve member Loretta Mester told CNBC on Wednesday if economic conditions remain the same, she will advocate for a 75 basis points (bps) hike in interest rates at the U.S. central bank's next monetary policy meeting in July.
Federal Reserve Chair Jerome Powell began a panel discussion at the ECB Sintra Forum at 13h00GMT, an event that could add further volatility to markets.
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DOW JONES Daily Chart- June 29,2022
Source: IG
From a technical perspective, yesterday we had a sharp rejection from the 61.8% fib level as discussed pushing us below our support area at 31300 and the key psychological 31000 level.
We are currently trading below the 38.2% fib level in a support area as indicated on the chart (grey box) with a break below opening up a retest of pre-covid highs. A bounce from here could see us test yesterday’s highs and the trendline around the 32000 area.
Key intraday levels that are worth watching:
Support Areas
- 30750
- 30500 23.6% (Fib level)
- 30000 (psychological level)
Resistance Areas
- 31000
- 31420 (50% Fib Level)
- 31900 (Yesterdays High)
| Change in | Longs | Shorts | OI |
| Daily | 34% | -17% | 2% |
| Weekly | 45% | -23% | 0% |
Written by: Zain Vawda, Market Writer for DailyFX.com
Contact and follow Zain on Twitter: @zvawda
https://www.dailyfx.com/forex/market_alert/2022/06/28/Consumer-Confidence-Worsens-as-Sky-High-Inflation-Hits-Household-Budgets.htmlhttps://www.dailyfx.com/fomc
