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 Pre Market Sentiment and Charts Influencing UK Markets 06:30 (3 mins read)

FTSE Futures dipped to 7000 overnight setting up a tradeable long and has rallied back to 7100 (+55 cash close)  after  a day of hectic price action and collapses in correlations:- often the mark of an intermediate low and capitulation. UK saw some sacrificial slaughterings with retail taking an extreme pounding on trading results and BoE suggestions of inflation at 11%+.  ASOS, Halfords down over 30% in one day - proper hair on fire price action that should see a dead cat bounce in these names  over the next few sessions

The US session was ugly in the extreme with the DOW dipping below 30000, NASDAQ got firebombed - 4% with even quality tech like MSFT, GOOG and AAPL pummelled. Energy also taken to the woodshed

Sentiment extreme bearishness - VIX hit 35 yesterday back to 33 highly elevated. Check the AAII individual investor sentiment now almost 60% bearish with just 19% bullish. Mean reversion suggests some move back to equilibrium.

OIl - dipped to the 21EMA (blue line in chart) and then rallied stays bullish

Chart of the FTSE 100 futures is showing some resistance to  the 7100 - that which was support. This is both surprising and troubling so one to watch.

DXY has pulled back and set-up gold for a rally clearing its 200 MA - this yoyo price action may well continue but it has been well behaved and in a tradeable range.

Today should see some relief which may well extend to a few days unless we really are full-on crash though it is  rarely this obvious. Markets love to do what most don't expect.These current market conditions call for nimble responses and contracted trade  timescales given volatility. It can be confusing, maddening but  it's never dull.

 

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