In today’s briefing:
- Gold Bull/Bear Line and Oil Base Mend
- Pullback Continues; Japan & India Remain Attractive
Gold Bull/Bear Line and Oil Base Mend
- Gold short met 1,730 PT to close and now kissing key support at 1,700 as the long pivot level. WTI’s nasty give back needs basing at the key 85/86 support.
- Gold 1,700 and WTI 85 are make or break bull/bear lines. Gold RSI bull divergence stands out as the driver amid risk aversion and a safe have bid in bonds.
- WTI RSI uber bull divergence shows good energy to retake 93 but is it enough to offset demand destruction/Sept risk. Reserve levels are low and support the bull case.
Pullback Continues; Japan & India Remain Attractive
- We continue to see global equities as being in pullback mode, with the MSCI ACWI index (ACWI-US) already testing important support in the $86-87 range, highlighted last week.
- A bounce here would be ideal for the bullish case, but we could easily see a test of the YTD lows near $81.50 if $86 fails to hold.
- Japan’s TOPIX/Nikkei225/TOPIX Small remain bullish, as does India’s SENSEX — add exposure. Seeing some failed breakouts in Europe, notably the EURO STOXX 50 and STOXX Europe 600; a concerning development.
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