Better than expected earnings results continued to push European indices higher. On Thursday binary options on DAX index rose with 1.11% to 6758.39, which is its highest level since late April. The French market indicator CAC 40 gained 0.87% to 3263.64, while U.K.’s FTSE 100 closed 0.50% higher at 5714.19. Among corporate bulls Nokia shares surged 12% to €1.54 after it announce sales of its flagship smartphone – Lumia that topped analysts’ estimates.
This morning German Producer Price Index reported 0.4% decline for June missing the economists’ expectations for 0.2% drop. The price of goods sold by manufacturers is a leading indicator of consumer inflation and negative change should cause pressure on the European currency. Binary investors should also expect lower open on the German stock market.
In U.S. the market was also under positive sentiment despite weaker economic results. S&P 500 has reached two-month high closing the session 0.27% higher at 1376.51. The blue chip Dow Jones Industrial Average added 34.66 points to 12943.36, while NASDAQ Composite gained 0.79% finishing the trading day at 2965.90.
All of yesterday’s economic data fell short of expectations with initial and continuing jobless claims, existing home sales, the Philadelphia Fed, and leading indicators all missing their marks. However, market participants speculate that the weaker results will lead the Federal Reserve to add stimulus. Corporate earnings also support the positive spirits especially in the tech sector where Google, IBM and EBay reported better than estimated results for the second quarter.
EUR/USD
In the last couple of days binary EUR/USD is consolidating in very short range between 1.22-1.23. However, the overall picture remains negative and investors should expect new test of the psychological 1.22 with first support around 1.2165. Break below the latter is expected to send the price lower towards the key 1.20. On the upside binary players should expect first intraday resistance at 1.23, followed by 1.2335 and 1.24.
S&P 500
The U.S. market indicator remains in positive trend reaching fresh two-month high at 1380. Binary investors should expect short downside correction to 1360 considering oscillators overbought levels. Today if the index opens higher it will have the potential to move the price towards the psychological 1400. On the opposite direction, downside movement is expected to meet intraday support at 1363, followed by the 1335-1330.
DAX
Binary options on DAX surged higher breaking above 61.8% Fibonacci retracement of the 7216-5918 movement. Investors should expect correction to at least 6700 considering oscillators overbought levels. On the downside lower supports are expected at 6650, followed by 6600. On the opposite direction resistance is expected at the psychological 6800, followed by 6885.
Disclaimer:
The information in this analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.
