Greece continues to dominate headlines as of late as the Greek people voted in favour of a 'No' vote. This had surprised many who had expected Greeks to vote in favour of a 'Yes' vote to keep the euro-zone together and to keep Greece in the Euro-zone. Nevertheless it's likely that this saga is not over any time soon as the ECB and EU goes back to playing games with Greece and the Greek people.
As a result of Greece, equity markets were very much active. The DAX was on fine form this morning as it managed to rally back on the charts, despite the fact that sentiment was mostly negative against the Euro. Resistance at 10884 was strong, and held back further advances from the market. It would surprise me to see further gains in the DAX unless we see some sort of haircut from the euro-zone. However, the time for weakness is certainly not in the past and it's something that I would not expect at all given how far Greece has pushed the Euro-zone to collapse.
The FTSE was struggling for movement as well after touching support at 6445 on the charts. Current market sentiment is looking for higher highs on the charts, but with the lack of momentum in European markets, we could see some sideways movement for a bit, followed by playing of major levels. I would expect to see the FTSE rally in the medium term as the British economy for the most part has been quite strong despite the troubles across the channel.
Oil has hit a few road blocks to further rallies, as it has slipped strongly on the charts into a bearish trend. Support at 51.81 is likely to be the key level at this stage, as the market is looking for lower lows in the current market. Despite all of this, I would be closely watching further movements, as the market is expecting further weakness on the demand side, which will drive prices lower in the long run despite all that OPEC has done.
The NZD has held up on the charts after the recent dramatic movements in the market. Currently 0.667 is playing as the hard support/resistance level to further movements. It's no surprise that the NZDUSD is struggling after recent data NZIER business confidence showed a drop to 5% from 23%. With all the market movements in the NZDUSD we could see this level look to hold back further advances on the charts; the question is for how long - at this stage it certainly seems that the NZD has run out of steam and this is the end of line for further rises, but a push back to the 0.70 mark should drive strong bears back into the market.
Lastly the RBA is set to be the big draw card in the Asian trading session, as the cash rate statement is due out shortly. Markets are expecting rates to be steady, and so do I at this stage. Despite all the hardships the RBA has a history of holding back until the last minute and they will look to continue this trend in the long run, as they feel that rushing monetary policy to defend the economy could be unhealthy in the long run. The market is finding strong support at 0.7464 on the charts and any push below this would point to the bears taking control.
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